GGF Brexit campaign enters transition period

Following the GGF’s Government funding for the Brexit Readiness Campaign for the Glass and Glazing industry, the organisation will now use existing communication channels to ensure companies receive up-to-date, accurate and expert guidance, to help them cope with the Brexit Transition period.

The Transition Period    

With the UK leaving the European Union on 31 January, the country is currently embarking on an 11-month Transition Period, during which the UK will remain in both the EU Customs Union and Single Market, meaning there will be no alterations to the previous trading relationship, including free movement.

However, UK and EU negotiators will look to agree a new trading relationship during the Transition Period.

The Transition Period is set to finish on 31 December, but there is an opportunity for extension, if both the UK and the EU agree to an extension before 1 July 2020.

The GGF will continue to work with the Government and will relay any changes throughout the Transition Period. 

Here is the latest situation between the UK and EU in terms of a trade agreement. 

Negotiating positions

Prime Minister Boris Johnson and EU Chief Negotiator Michel Barnier set out their respective opening negotiating positions for future trading relationships in early February. The statements confirmed the EU will pursue a close trading relationship, while the UK will seek to diverge considerably from current arrangements. 

EU position

 – Mr Barnier said that the European Union will offer the UK tariff-free access to the Single Market, if the UK would accept EU standards on a number of issues including state aid, employment and environmental standards.
 – If the UK does not agree to alignment on these issues, the EU will offer a looser arrangement which would include customs checks and tariffs on UK/EU trade.
 – The EU will not offer a ‘Canada-style’ trade deal, which allows comprehensive access to the Single Market without demanding alignment on key issues.

UK position

 – Prime Minister Johnson said that the UK will reject the offer of a close trading relationship with the condition of regulatory alignment.

 – The Prime Minister reiterated the UK’s desire to pursue a ‘Canada-style’ arrangement. However, this isn’t possible, the UK will seek to leave the EU on World Trade Organisation (WTO) terms – the equivalent of a ‘no deal’ outcome.

It is important to note previous EU trade negotiations have taken significantly longer than a year to conclude, with the Comprehensive Economic Trade Agreement (CETA) with Canada taking seven years to agree.

Given the two sides’ contrasting goals and the lack of time to reach an agreement, there is a possibility that no deal will be brokered before the end of the Transition Period.

Key issues for the companies in the glass and glazing industry 

As previously highlighted, nothing will change before the end of the Transition Period, and the arrangements are subject to negotiation over the coming year. However the following is possible

Trade arrangements

Trade arrangements for goods travelling between the EU and UK will be discussed in negotiations between the two parties. 

 – If the two sides are unable to reach an agreement on the trade of goods before the end of the Transition Period, EU/UK trade would be subject to tariffs and additional VAT under WTO rules. This would also necessitate additional paperwork, in the form of import declarations.

 – If the sides are able to compromise on the issue of regulatory alignment, tariffs could be avoided. 

The GGF will provide further updates on likely implications of the trade negotiations for the glazing sector throughout the year.

Standards

Agreements on environmental and labour standards after the Transition Period will be subject to negotiation and will be directly related to discussions on the trade of goods.

The EU is looking for alignment in these areas, in exchange for free movement of goods and the UK is aiming to diverge from current standards.

For construction products standards, Government has published legislation that mirrors the current EU Construction Product Regulation (CPR) 2013, meaning there will be no changes to standards required for construction products imported from the EU, if no agreement is reached. 

The GGF will continue to monitor for updates relating to changes to standards that will impact on the sector in the coming months.

Skills 

When the UK leaves the EU Single Market, free movement of labour from within the EU will end and the UK will adopt a new immigration system, under which there will be no distinction between EEA and non-EEA citizens. 

The Government’s immigration plans post-Brexit centres around a points-based system, based largely on skills.

James Lee, GGF Director of External Affairs, commented: “Throughout the Brexit transition period, the GGF will continue to update the industry as and when we receive the latest information.

“The Brexit Hub we have set up on the GGF website, is now the go to place for the industry on all the issues affecting companies during the transition period.

“I would advise companies to visit the Hub to keep up to speed on all the forthcoming changes that will impact on the sector in the coming months.”

Contact:

Glass and Glazing Federation
40 Rushworth Street
London
SE1 0RB
LONDON

t: 0207 939 9101

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