As things stand, in law, the UK will leave the EU on 29 March 2019 without any deal if the Prime Minister cannot find common ground with MPs on what a withdrawal agreement should look like. Britain looks unlikely to finalise the majority of trade deals needed to replace the European Union’s 40 agreements with other countries by exit day.
Sustain Briefing, January 2019: We must not let Brexit cause a food crisis for people most in need.
Sustain Blog, August 2018: A ‘no deal’ Brexit will indeed mean shortages – mainly of food and farming jobs, workers, transport and common sense.
The Sustain alliance has expressed profound concerns about the implications for food, farming, fishing and the environment of a ‘no deal’ Brexit. Below, we explore what the implications might be. We have endeavoured to be as factual as possible, with references, because political emotions are running high. Our concerns relate to food standards, farming, animal welfare, antibiotics stewardship and to the well-being of consumers and the farmers, fishers, producers and natural systems that provide our food. If you have any suggestions for other questions, or comments, do please get in touch with firstname.lastname@example.org.
The WTO is a global organisation that deals with the rules of trade between nations. It has 164 member states, including the UK. It works on the principle of agreements, which have been negotiated and signed by most of the world’s trading nations and ratified in their parliaments. The goal is to help producers of goods and services, exporters, and importers conduct their business. Based in Geneva, it resolves disputes by independent judges through a dispute resolution process.
We’re leaning on the BBC for this answer. You’ll find their full article here. Every WTO member has a list of tariffs (taxes on imports of goods) and quotas (limits on the amount of goods) that they apply to other countries. These are known as their WTO Schedules. Under WTO rules, if the UK leaves the EU without a deal, products will be required to be taxed every time they cross the UK-EU border. The food tariffs are high, with 20-35% on processed food, 35% for dairy products and 45-50% on meat.
After Brexit, if the UK wanted to do quick trade deals, we could choose to lower tariffs or waive them altogether for the goods we import. That might sound like good news for UK consumers looking for a bargain, but it could be bad news for food standards and for UK farmers and food businesses, who are warning that it could drive many out of business. You can get a full picture on what the NFU thinks of no deal and trading on WTO rules here. You might also like to read our briefing on why cheap food isn’t good food.
Under the WTO's "most favoured nation" rules, the UK couldn't lower tariffs for the EU, or any specific country, alone. It would have to treat every other WTO member around the world in the same way.
For a more detailed picture of how No Deal might impact UK farming, you might like to read this Farmers Guardian article (£). It covers tariffs, meat exports, veterinary staffing and medicines.
The Governor of the Bank of England, Mark Carney, has predicted food price rises of between 6 and 10% due to currency fluctuations, new tariffs and delays at ports. Secretary of State for Defra Michael Gove recently acknowledged that a ‘no deal’ Brexit would lead to “price spikes in certain foodstuffs”, with similar warnings from the leaders of several major food businesses and retailers, the House of Lords EU Committee, the Institute for Fiscal Studies, and the Chartered Institute of Procurement and Supply.
If they’re right, it is unclear how long it would be before price rises would start. Back in 2017, the Prime Minister said she would not let this happen, but this is precisely what is currently under debate. No deal means no transition period and, in theory, tariffs would need to be applied from day one, in order to comply with WTO rules. As discussed above, the UK could unilaterally waive tariffs on all food imports to temporarily lower food prices, but this would have knock-on effects for British farmers, fishers and our food industry.
Under a no deal situation, yes, new tariffs would be added to the food exported by British farmers and food businesses, meaning that they would be more expensive and potentially less attractive to consumers in the European countries. The UK currently exports around £13 billion worth of food each year without these tariffs.
Farmers Guardian magazine has reported that British beef and sheep meat exports would face tariffs of at least 40%. In addition, food exports would be required to undergo new checks, including sanitary controls. This was confirmed by Michael Gove, Secretary of State for Defra at the recent Oxford Real Farming conference. British farmers may also be affected by new tariffs on vital imports of veterinary medicines, animal feed and machinery from other European countries.
In 2017, research from the AgriFood and Biosciences Institute (reported on by Farmers Guardian) found that some dairy and livestock farmers might initially benefit from increased prices under WTO rules, with consumers picking up the tab. However, the Government has already asked Defra to look at dropping those tariffs to reduce the pressure on food prices.
Our food standards are unlikely to change overnight as we will be using up existing food stocks, EU-style rules have been transferred into UK law for now, and Michael Gove has reassured Parliament that standards won’t change at all.
If we do want to continue to trade food with the European Union, our food exports will have to meet the EU’s standards but as the UK will have left the EU, it will no longer have a say over the setting of those standards.
However, the UK is seeking international trade deals with other countries like the US and Australia, whose agri-business lobbyists and trade negotiators have already said that the UK would have to accept products currently banned under EU and UK law – for example, chlorinated chicken and hormone treated beef, and food from farms that use pesticides and farm antibiotics that are not permissible in the UK.
If we exit the EU without a deal, then customs checks and sanitary checks on food and animal products at border crossing points will have to be introduced. Currently, the necessary infrastructure does not exist. For example, Michael Gove told the Oxford Farming Conference, border inspection facilities do not exist at Calais in France, which is where the majority of British food passes through into Europe, mainly from Dover.
Imperial College researchers modelled the potential impact of even small delays on traffic at Folkestone and Dover. They found that two extra minutes spent on each vehicle at the border could more than triple the existing queues on the M20/A20, to 29 miles. At peak times, Kent could see nearly five hours of traffic delays.
UK businesses (e.g. fishers) exporting fresh food are already expressing alarm at the consequences of delays at the ports.
According to the Food Research Collaboration, 18.25 million tonnes of food passes through UK ports each year, mostly fresh or perishable food: fruit, vegetables, fish, meat and dairy products. 2.5 million lorries pass through the UK’s main port of Dover every year.
For now, whatever happens next on Brexit, the UK will maintain EU-style rules on food safety, food labelling and food quality.
However, changes will be needed to take account of the UK no longer being a member of the EU. For example, UK products or ingredients will no longer be able to say on the label that it has been made in the EU. Additionally, certified products such as organic food, will need to be accredited by an EU-recognised body, and the months-long process for gaining such accreditation cannot start until after Brexit day.
UK products will now have to have a UK business address and similarly, UK companies who want to export to the EU will need to have a business address in the EU. In the short term, the UK government is considering continuing to allow, for up to 6 months after a ‘no deal’ Brexit, food bearing an EU address to be sold on the UK market. It has also said that businesses can continue to sell existing EU products until stocks are exhausted.
Under EU arrangements, some UK products, like Stilton, Melton Mowbray pies and Scotch Whisky, have legally protected names. EU law protects these regional specialities from copycat producers and enables producers to benefit from a price premium.
In the short term, UK protected food names will still be on the EU register, but it is unclear for how long. The relevant EU legislation is being incorporated into UK law via the EU Withdrawal Act, but the EU is unlikely to countenance having products on its register that are not covered by EU legislation or are covered by domestic legislation it has not approved.
If we leave without a deal, UK producers will no longer have the legal protection and will have to remove any EU ‘PDO’ label as the copyright belongs to the EU.
The UK government says it will develop a new UK logo to show these are special products – but it is not clear if this would provide the same market recognition or legal protection as the EU scheme. It has pledged to consult on that before introducing it, but there has been no sign of that yet.
In their No Deal technical notices, the UK government stated that the EU would simply recognise UK geographical indicators, even though the UK would no longer have to recognise theirs. This seems unlikely. The EU is famously very protective of its system - not least as the market is worth an estimated £47.8bn per annum for the EU. The Government has warned UK producers that, without a deal, if they want to secure or regain their EU protected status they will have to submit applications to the European Commission as ‘third country’ producers.
Other countries, like the US, see protected name rules as a barrier to trade that they would like removed as they would like to sell similar products, produced differently, under the same or similar name.
Currently, only 6% of the cod we eat in the UK is from our own stocks, which have declined steadily over decades due to overfishing and warmer UK waters sending the cod further north. The main importer for cod into the UK is Iceland, with whom we have a trade deal because we're in the EU.
As Iceland are members of the European Economic Area (EEA) and the European Free Trade Association (EFTA), the EU gives Iceland preferential access to the EU market for cod and reduces their tariffs on fish products.
Unfortunately, it looks like the UK will not be able to simply roll over trade agreements it had as part of our EU membership. The UK’s Trade Secretary Liam Fox has said that he is confident that Britain could still replicate the EU’s ‘five most important’ deals by March 29, 2019. But he didn’t mention the Iceland deal as one of those. (He did reference Norway, but they send us one quarter of the amount of cod that Iceland does).
If the UK leaves the EU with no deal then boats from EU countries would not be able to enter UK waters because we would automatically ‘drop out’ of the Common Fisheries Policy. There are concerns that this would result in immediate retaliation from French fishers who could take direct action at Calais, blocking British lorries from entering France. EU based fishers have long argued that discussions about rights of access to fishing in British waters must always take account of British access to European markets – i.e. the tarrifs that the UK would need to pay to export. It’s also worth noting that some UK vessels fish outside the UK’s territorial waters, so their access to those waters would be stopped, unless EU member countries agreed otherwise.
There is a further complication in that some countries like Denmark and France claim historical fishing rights – which they are entitled to do under international law - dating back hundreds of years, and have already said they could take the issue to the courts.
If the UK leaves the EU with no deal, then we will be trading on WTO ‘most favoured nation’ terms. WTO tariffs on fish products range from 0% for some fresh products to 25% for highly processed products. As an example, for the top five fish products exported from the UK to the EU, the tariffs ranged from 2% on Atlantic salmon to 20% on frozen mackerel in 2014. Equally, the EU would face tariffs on exporting to the UK at a level agreed between the UK and the WTO. These are all negotiated decisions that have yet to be made.
Yes. UK fishers exporting fresh fish and shellfish are already expressing alarm at the consequences of likely delays at the ports.
EU law, for example, requires all fish caught outside the EU to have a catch certificate. Whilst the UK is a member of the EU, UK fish exporters don’t need to produce these, but would need to following a ‘no deal’ Brexit. The same goes for Animal Health Certificates which are currently required for any animal product that enters the EU area.
No one (that we’re aware of) has seriously suggested that our farming standards and enforcement, such as on the environment or animal welfare, will change immediately. UK Environment and Food Secretary Michael Gove says he wants to maintain these and make them even stronger. This is why the new UK Agriculture Bill is so important – it will set the ground rules for how British farming and environmental standards are governed in the future. However, not all decision-makers in Government, and not all industry agree with Michael Gove, and he presumably won’t be our Defra Secretary forever. The situation continues to develop.
There are already worrying signs that the UK government would like to diverge from the EU on rules such as their ban on the preventative use of antibiotics in animal treatment. It is also the case that that farm antibiotic use in some non-EU countries with whom the UK government is seeking trade deals (like the US, China and Canada) is very high in comparison to the level typically used by British farmers. Another example is that the UK farming minister George Eustice has recently indicated that the UK government is not minded to implement new EU rules to prevent Unfair Trading Practices that could protect farmers from abuse by big buyers such as supermarkets and food manufacturers.
With regard to pesticides, the UK government has already said it will set up its own regulatory system, and in the short term only make changes to current rules where necessary. However, government representatives have also said it could choose to diverge from the EU in the event of a ‘no deal’ Brexit.
Environment and sustainable farming groups are concerned that crucial laws that affect farming, such as on protecting nature and wildlife habitats, ensuring animal health and welfare and curbing pollution of water and air, will all be potentially much weaker after a ‘no deal’ Brexit. Colleagues at the Greener UK alliance have pointed out that the legal framework and robust enforcement are both under threat, and are working hard to encourage our government to introduce new UK laws to fill these glaring gaps.
British farmers receive about £3bn in farm payments via the UK’s membership of the EU – a budget to which the UK contributes substantial funds. The UK Government has committed to maintain the same cash total for farm support until the end of this parliament – expected in 2022 at the latest.
Amounts are difficult to calculate precisely, but we estimate that at least another £10bn of funding could theoretically be allocated around the UK if we replicate European funding programmes such as the European Regional Development Fund (ERDF), the European Social Fund (ESF) and the European Maritime and Fisheries Fund (EMFF). Such funds have in the past been targeted at, for example, rural development, support for small and medium-sized enterprises, facilitation of small-scale farmers into public-sector food contracts, development of tourism, transition by fishers to less damaging fishing gear, and into regions (such as Cornwall and Wales) whose local economies need a boost.
The UK government has guaranteed that any rural projects where funding via the EU has been agreed before the end of 2020 will be paid for by UK funds for their full lifetime. Defra and the devolved administrations of Scotland, Wales and Northern Ireland, as well as businesses, community organisations and universities, can continue to sign up to new EU-funded projects after the UK leaves the EU during 2019 and 2020.
After that there are no guarantees other than UK ministerial assurances. We understand that the current government plan is for such funds to be bundled up into a general ‘UK Shared Prosperity Fund’, with no evident rules or principles for how or where this can be spent, beyond a general commitment to “promoting productivity”.
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