Comment

 Securing good customs arrangements should be easy - common sense will ensure that

David Davis, U.K. exiting the European Union (EU) secretary, left, looks towards Michel Barnier, chief negotiator for the European Union
David Davis, U.K. exiting the European Union (EU) secretary, looks towards Michel Barnier, chief negotiator for the European Union Credit: Dario Pignatelli /Bloomberg

The government has published its Brexit position paper on customs arrangements. When we leave the EU there will need to be some new arrangements for clearing goods at the border as they enter the EU or come into the UK.

Even if there is a new free trade agreement with the EU that means there are no new tariffs, that would still leave the issue of any goods that come into the UK from third countries (e.g. the US or Australia) with whom the EU has no trade deal or does not have a deal with exactly the same terms as the UK’s. Goods from, say, the US might not have tariffs to come into the UK but would have tariffs if then transited onwards to the EU. So the EU will need to verify that goods exported from the UK have actually originated in the UK, rather than from somewhere else. Customs clearance is also required to check relevant taxes have been paid.

The UK government’s position paper gives two options for customs clearance. One is based on developing new technologies to check and clear products. The other is based on achieving a very high degree of commonality in customs approaches so that, effectively or in fact, the EU will recognise checks the UK carries out and vice versa.

Which of these approaches will work best obviously depends upon whether the technologies can be developed and the commonalities agreed. The basic principle of seeking the most frictionless border we can is unquestionably correct, however.

Whatever solution is ultimately developed, there is no reason to believe customs clearance must return to the delays that were typical before we joined the EU or before customs clearance was simplified and vehicle checks were eliminated under the Single Market Programme of the 1980s and early 1990s. Technologies and procedures have moved on dramatically in the past 30 or 40 years and the UK has accepted electronic declarations since the 1990s. There will only be material delays if they are created deliberately in order to deter imports.

The position paper also proposes “for an interim period…a new and time-limited customs union between the UK and the EU Customs Union”. This arrangement (which would be combined with the UK being able to negotiate and sign new trade agreements with non-EU countries such as the US and Australia, though they would only come into force when the interim customs union ended), should allow time for new customs procedures to be honed, time for businesses to adapt, and a transitional wind-down of UK EU contributions (removing most of the “divorce bill” issue). It seems entirely reasonable that there should be transitional arrangements both for the UK and EU businesses in terms of customs, and for the EU in adjusting to doing without UK financial contributions.

There will inevitably be some extra hassle under any new system, but business should find it fairly easy to cope. Agreeing mutually beneficial customs procedures should be amongst the easiest parts of the Brexit negotiations. There will much thornier issues to come than this.

One of these trickier aspects, closely connected to the new customs procedures, concerns the border with Ireland — where the government is intending to set out its proposals tomorrow. The government is quite clear that nakedly pro-united-Ireland proposals to create a border within the UK, with Northern Ireland fused with the Republic in a single customs area, are a non-starter. On the other hand, the UK government is adamant that, at least on our part, we see no reason for a hard border.

A little common sense should get us through this fairly straightforwardly. Irish citizens will continue to be allowed to come to the UK as per the long-standing pre-EU arrangements with Ireland. Non-Irish EU citizens will probably not be checked at the Ireland-Northern Ireland border, but will still be required to comply with immigration rules (e.g. if they over-stay or attempt to take work that the rules do not otherwise allow, they will be in violation of those rules and subject to penalty). Products being exported from the Republic into Northern Ireland can be pre-cleared and then taken across the border. Again, it would be feasible to have ex post checks (e.g. make it an offence to take non-compliant products across the border but only check later if that had been done) rather than stopping vehicles at the border.

The EU may say that it insists on stopping and checking products or persons travelling from Northern Ireland into the Republic. We cannot prevent that if they insist on it. But for our part there is no reason there need be any visible day-to-day hassle at the Irish border.

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