Guidance

Trade Bill factsheet: providing continuity and maintaining standards in UK Trade Agreements

Published 14 December 2018

This guidance was withdrawn on 20 March 2020

This page has been withdrawn because it’s out of date.

You can read about the Trade Bill at https://www.gov.uk/government/publications/trade-bill.

What the Trade Bill does

The Trade Bill provides continuity in the UK’s trade.

As priority, the government is seeking to secure the continuity of the effects of existing EU free trade agreements and other preferential trading arrangements as we leave the EU.

This will provide certainty to businesses, international partners and investors about the UK’s continuing trading relationships as we leave the EU.

As part of this continuity, we will maintain the same level of standards that we currently have in these existing agreements.

Prime Minister Theresa May speaking in Florence on 22 September 2017, said:

[we are] committed not only to protecting high standards but strengthening them…we will always be a country whose pitch to the world is high standards at home.

What the Trade Bill does not do

The Trade Bill does not allow for the implementation of any future free trade agreements with countries such as the USA and China.

The government has proposed a bespoke approach for new trade agreements – as set out in the Secretary of State for International Trade’s announcement to Parliament on 16 July 2018.

In order to meet our objective of providing continuity as the UK exits the EU, the terms of our existing trade agreements are not being renegotiated. Our partner countries agree with us that this is the right approach.

‘Almost no one who contributed to our inquiry suggested that the government’s policy objective of seeking continuity was the wrong one’ International Trade Select Committee Report (March 2018).

How we will provide continuity

The Trade Bill contains a power to:

1. implement obligations under continuity agreements, which require amendment to UK domestic law to make them operable in a UK context - for example, to substitute the name of a UK product checking body for an EU one in UK legislation

2. implement obligations under continuity agreements which maintain the effects of trade agreements agreed by the EU but not yet implemented at an EU level

3. make appropriate adjustments to domestic legislation over time to ensure the continued operability of continuity agreements – such as adding to lists of new approved product-checking bodies

Sam Fowles, UK Constitutional, Law Association, said:

[The Trade Bill marks] a significant step in the evolution of the UK’s constitution in that it gives Parliament a greater say in the making of international trade agreements than ever before.

The government’s aim is to ensure that the rules of origin applied in our continuity agreements enable businesses to continue to operate, as much as possible, through their established value and supply chains, recognising that this is particularly important where integration with the EU is significant. It is for the UK and its partners to determine the rules of origin arrangements in our continuity agreements.

This implementing power in the Trade Bill will be subject to the affirmative resolution procedure. As such its use will require the approval of both Houses of Parliament. This is in addition to the existing parliamentary processes governing ratification (under the Constitutional Reform and Governance Act 2010), which will apply to all continuity agreements that require ratification.

The Trade Bill also places an obligation on ministers to publish a report outlining the changes being made to a continuity agreement before using the implementing power in the Bill. This report provides transparency for Parliament, business and consumers – about the changes being made to continue the effect of existing EU trade agreements.

A Food Standards Agency spokesperson, said:

From day one we are committed to having in place a robust and effective regulatory regime which will mean business can continue as normal.

The scope of the power is limited in the following ways:

1. it can only be used to implement agreements with countries that have signed trade agreements with the EU before Exit Day - as the EU does not have free trade agreements with China or the USA, the Trade Bill cannot be used to implement future free trade agreements with those countries

2. it is subject to a sunset of 3 years after Exit Day – this can only be extended with the approval of both Houses of Parliament

The steps we are taking to introduce trade legislation will not at this point affect our trade relationships with third countries, the operation of the Common Commercial Policy of the EU, or the international trading frameworks within which the UK operates as a member of the EU.

Michael Gove speaking in September 2018, said:

I have been very clear that Brexit will not lead to a lowering of our high food, animal welfare and environmental standards. This will remain at the heart of our approach as we negotiate both the EU and with new trading partners around the world.

Background

The power in the Trade Bill will not be used to reduce standards – the accusation that the government would compromise food standards to secure post-Brexit trade deals is not only untrue and unsubstantiated, it is counter-intuitive.

The global demand for British products is based on our high standards – people buy British not because it is cheaper, but because of its high quality – and to disregard food standards would be to undermine the future of British exporters.

We are committed to upholding and strengthening our high standards in food, public health and safety, product performance, and protecting the environment.

For example, human health and the environment is currently protected by a large body of existing EU environmental law covering areas including air quality, waste and resources, water, wildlife and habitats, chemical and pesticides. The EU Withdrawal Act 2018 will ensure all existing EU environmental law continues to operate in UK law, providing businesses and stakeholders with certainty as we leave the EU.

In addition, we have made it clear that as we leave the EU we will maintain and enhance our reputation as a global leader on animal welfare. The government will ensure that any necessary changes required to UK law are made in a rigorous and comprehensive way to ensure animal sentience is recognised after we leave the EU.

John Edwards -The Wildlife Trusts Director of Living Seas, said:

Really impressed that the government is committed [in its Fisheries White Paper publication] to reversing the loss of marine life and where possible to restoring it. This is a giant step forward for nature.

Trade Statistics

The existing EU trade agreements, which the government intends to continue the effect of, apply to 12% of the UK’s total trade.

The most significant of these agreements for the UK are:

• Switzerland – 3.1%
• EEA – 2.0%
• Canada – 1.4%
• Turkey – 1.3%
• Singapore – 1.0%
• South Korea – 1.0%

Department for International Trade

The UK’s Department for International Trade (DIT) has overall responsibility for promoting UK trade across the world and attracting foreign investment to our economy. We are a specialised government body with responsibility for negotiating international trade policy, supporting business, as well as delivering an outward-looking trade diplomacy strategy.

Any enquiries regarding this publication should be sent to us at enquiries@trade.gov.uk.