17 Jan 2019
Brexit: No Deal Contingency Planning
With just 9 weeks to go until the UK are set to leave the EU on the 29 March and with an overwhelming majority in the UK Parliament against the negotiated Withdrawal Agreement, the likelihood of a no-deal Brexit is greater now than ever before. Therefore, despite continued work and preference towards reaching a deal with the UK, the Irish Government, the EU and businesses have begun to put their contingency plans into action to mitigate potential risks.
European Commission Plans
Speaking to the Copa Cogeca Brexit Task Force on Wednesday, 16th January, John Watson, of the European Commission Secretary General, outlined the EU’s contingency proposals, which aim to address areas of key interest to the EU which are deemed to be particularly exposed to damage in the event of a no-deal. These measures include:
- Proposed legislation on a transport, to ensure basic air and road connectivity by allowing for the temporary (12 months) provision of certain air services between the UK and the EU and allowing UK road haulage operators to temporarily (nine months) carry goods into the EU, provided the UK confers equivalent rights to EU road haulage operators. These arrangements, together with UK assurances that it will remain committed to the Common Transit Convention, are needed to allow for the continued use of the UK as a land-bridge for the import and export of goods from Ireland.
- Proposed legislation on SPS and customs, regarding the listing of the UK as a third country so that it can continue to export agri-food products to the EU (with the legislation to be finalised in February) and extending the relevant time limits for customs declarations on goods entering or leaving the Union’s customs territory to the UK. Additionally, Waston outlined that the Commission is working closely with member states, and in particular with Ireland, the Netherlands and France to ensure that the necessary new customs facilities are in place and functional.
- Furthermore, the Commission has called on EU Member States to take the appropriate action to grant UK citizens in their country temporary residence status and allow for the continuation of relevant social security coordination as an acquired right.
These measures, are bare bones arrangements and do not offer anywhere near the level of transition envisioned within the Withdrawal Agreement- for example there are no special waivers to allow for roll-on/roll-off exporting through UK ports to continue and nothing is said about the Northern Ireland border and whether the EU would intend regulatory checks to be applied on goods entering Ireland.
Irish Government Plans
The Irish Government published its “No Deal Contingency Plan” at the end of December and this week the relevant legislation has begun to be brought before the Dail. This legislation will include a “Brexit Bill” which will enact changes to up to 17 separate laws, to be introduced on the 26 February.
The Contingency Plan includes proposals for the purchase of land at Dublin and Rosslare ports to reduce congestion caused by new customs checks and the hiring of new staff for the Department of Agriculture, Food and the Marine to conducts the checks on agri-food products traded between the EU and UK. Again, however the Plan includes no mention of potential checks on the Northern Irish border, as the Irish government continues to rule out the possibility of a hard border, or any action that would undermine the 1998 Good Friday Agreement.
The document also includes a commitment to mitigate the impact on farmers and the agri-food sector to as great an extent possible, through the provision of budgetary supports and intensifying market diversification assistance.
Read the full text here: https://merrionstreet.ie/MerrionStreet/en/News-Room/Releases/No_Deal_Brexit_Contingency_Plan.pdf
Business Contingency Plans
There are a number of information sources and support tools to help your business take the necessary steps to prepare for the changes in customs processes and legislation, including:
Customs and Tariff Training: Enterprise Ireland are arranging training courses forbusinesses on the key concepts, documentation and processes that are required for trade with a non-EU country.See: https://www.prepareforbrexit.com/customs-insights-course/
Brexit Loan Scheme: Loans for micro, small and medium sized businesses exporting to the UK or indirectly impacted by Brexit, of between €25,000 to €1.5m are available through AIB, Bank of Ireland and Ulster Bank, at a maximum interest rate of 4% and a length ranging from 1 to 3 years. See: https://sbci.gov.ie/brexit-loan-scheme
Act On Initiative: A course from Enterprise Ireland focusing on financial and currency management; strategic sourcing and customs and logistics. See: https://www.prepareforbrexit.com/brexit-act-on-initiative/
Be Prepared Grant: A grant of up to 5,000 or 50% of the total cost in financial support, to provide strategic support through a consultancy, or internal research, to determine how the company could respond to Brexit. See: https://www.prepareforbrexit.com/be-prepared-grant/
By Alison Graham
European Affairs Executive