A NEW law to be introduced by the UK Government on Wednesday, potentially overriding commitments on customs contained in the Northern Ireland Protocol, has created fresh uncertainty for businesses preparing for the end of the Brexit transition period on December 31.
Downing Street said the UK Internal Market Bill will only make “minor clarifications in extremely specific areas”, but business groups in Northern Ireland have warned that firms beginning to put concrete plans in place have been left scratching their heads over the implications.
The Northern Ireland Protocol was agreed by the UK and EU in October 2019 as the fall-back position in the event of a no deal scenario.
News of the legislation, which could change customs plans from January, came ahead of an expected announcement from HMRC on the award of a £200 million contract to operate the Trader Support Service (TSS).
The TSS will effectively see the UK Government act as a customs agent on behalf of businesses.
Seamus Leheny, policy manager at Logistics UK described the TSS as a “life buoy” to help businesses get through the end of transition.
“All of a sudden we’re back into lack of clarity yet again.”
He said Logistics UK has been working closely with other trade bodies to make the NI protocol work for businesses.
“To completely remove that off the table and put us back into unknown territory again, I think that is going to cause businesses here a lot of anxiety,” he said.
In a statement on Monday, the Northern Ireland Business Brexit Working Group repeated its position that a zero tariff zero quota deal between the UK and EU would resolve many issues: “The Northern Ireland Protocol is not perfect but it averts some of the worst consequences of a chaotic non-negotiated outcome.
“We have been working with the UK Government and the EU to remove frictions and make this protocol work as a starting point for the NI economy following the Brexit transition period.
“It would be greatly enhanced by a zero tariff zero quota trade deal between the UK and the EU.
“Business continues to ask for the certainty that we need to prepare for the end of the transition in 16 weeks’ time.”
Chief executive of Manufacturing NI, Stephen Kelly said that the lack of detail for businesses with just 16 weeks left “means that those who create and sustain jobs are being put in an invidious position”.
He added: “We deserve better,”
Frankie Devlin from KPMG in Belfast said businesses now need to keep focused on their preparations for the new customs, VAT and other trading requirements as set out in the NI Protocol.
“Clearly, a zero tariff, zero quota trade deal is what NI businesses require. The NI Protocol is an international agreement and it is the template that businesses have been given to work with, therefore now is the time for outstanding issues on its implementation to be agreed.”
