The latest on UK trade policy below.
TAC: UK-Australia FTA ‘is compatible’ with UK sustainability rules
The recently concluded free trade agreement with Australia will not undermine the British government’s ability to make its own rules in the areas of health, environment or animal welfare, an independent body of experts has stated.
In long-awaited advice published by the UK government on 13 April, the Trade and Agriculture Commission said there was no evidence to suggest that the UK-Australia FTA would require the UK to weaken its statutory protections in these areas, or that Australia would be able to gain an unfair advantage in terms of its access to the UK market.
The advice offered by the 12-person Commission, led by Cambridge University trade law expert Lorand Bartels, will now feed into the government’s own ‘Section 42’ report on the agreement, which was signed in December.
This is expected to be submitted to parliament soon after the Easter break, and will pave the way for formal ratification of the agreement by the parliament.
A narrowly-drawn remit
The TAC’s remit for its 28,000 word report was narrowly drawn by the government, focusing on the direct impact of the agreement on UK health, welfare and environmental legislation.
The advice thus reads almost like a legal judgment, and makes no commentary on the economic effects of the decision to abolish tariffs on almost all Australian imports within 15 years.
Moreover, the TAC restricts its comments only to those impacts which may be felt as a direct result of the FTA.
There is thus little discussion of the controversial Australian practice of ‘mulesing’ merino sheep, because these sheep are kept primarily for wool, which can already be imported into the UK duty-free. Hence, the UK-Australia FTA by itself makes no material difference to the existing trade or welfare environment in this respect.
No changes needed to UK statutory protections
The conclusions of the report indicate that there is nothing in the FTA itself which will require the UK to make any changes to its existing laws in the relevant areas.
The TAC also states that the FTA “reinforces” the UK’s statutory protections in the areas covered, in that it commits the UK to maintain its protections in the areas concerned, and prevents Australia from gaining a trade advantage by lowering its own standards.
But the advice does note that under the consultation processes provided for in the agreement, the UK and Australia have the ability to make interpretations of the agreement, in a way which “may affect the scope of the agreement in future”.
The TAC report adds: “We note in this respect that these decisions are not necessarily subject to parliamentary scrutiny in the same way as amendments to the agreement, although any implementation of these decisions in domestic law would follow ordinary parliamentary procedures”.
Competitive threat to UK farmers?
However, the committee did warn that the FTA “is likely to lead to increased imports of products that have been produced at lower cost by using pesticides in Australia that would not be permitted in the UK”.
Products like cereals, sugar and rapeseed oil are likely to have been produced using such pesticides – and the tariff reductions within the FTA increases the likelihood that these products will be imported in greater quantities than before, the TAC warns.
Pesticide residue levels on the imported products would still have to fall within existing statutory limits. But Australian producers could enjoy a production-cost advantage over their UK competitors by virtue of having access to these products.
In light of the probable growth of UK imports of Australian agri-food products as a result of the FTA, the TAC emphasises that it is “important to ensure that the UK’s import control systems are properly resourced”.
EU formalises concessions for medicine supplies to Northern Ireland
The EU has approved legislation which adapts EU rules to allow medicines which are authorised in the UK to be used in Northern Ireland – even if these medicines have not been cleared by EU authorities.
The directive, which was formally adopted by the Council of ministers on Tuesday (12 April), is viewed as necessary to avoid the risk of Northern Ireland – which is in effect still part of the EU single market – becoming dislocated from the provisions of the UK national health service.
The initiative is therefore a rare instance of EU regulatory flexibility in the continuing post-Brexit standoff over the status of Northern Ireland.
Resolution of the medicines issue has been something of a crusade for European Commission vice-president Maroŝ Šefčovič, who has made great play of empathising with the day-to-day concerns of the Northern Irish people – and thereby subtly challenging the UK government over its preoccupations with more arcane issues such as the status of the European Court of Justice.
It may also represent a degree of ‘penance’ for the Commission’s very short-lived but much-criticised plan to suspend the provisions of the Northern Ireland to control movements of Covid vaccines in early 2021.
The new rules come into effect just a few weeks before critical elections to the Northern Ireland Assembly on 5 May, in which the Irish nationalist Sinn Fein party is tipped to emerge as the largest party for the first time in the history of Northern Irish politics.