DEFRA waste consultations (UK)

On 18th February, DEFRA (the UK Environment Ministry) opened up a series of consultations on proposals to change the way waste is managed –

(1) reforming the UK packaging producer responsibility system – the proposals will affect producers of packaging, and plastic packaging, at all stages of the chain – here.

(2) introducing a Deposit Return Scheme (DRS) in England, Wales and Northern Ireland – the Scottish Government had launched a consultation for distinct elements of a DRS, this consultation closed on 25 September 2018 – the proposals relate to drinks containers – here.

(3) introducing a plastic packaging tax – this was announced at the 2018 Budget, to apply from April 2022 on manufactured and imported plastic packaging with less than 30% recycled content – here.

Changes at the UK border (UK Brexit)

The Partnership Pack setting out the changes that will happen at the UK border issued (by the UK) in October 2018, is updated today (26th February 2019). This is here.

Note : this Pack sets out the changes that will occur at the UK border if there is No Deal, and covers services as well as goods. Please remember traders must have an EORI number (goods).

An important issue that has emerged is the availability of ISPM 15 wooden pallets (for goods exports to the EU). The EU has strict phytosanitary rules regarding third country pallets – here.

Publication of the UK import tariffs (on goods imported into the UK, in a situation of No Deal) is expected shortly. I will update this Blog post here with the link, when it is available.

April 18 (UK & EU Brexit)

I am being asked what happens after 29 March. I post as the documents are issued, the various contingency proposals that are being prepared.

29 March is the exit date in enacted UK law (the Withdrawal Act) and the EU having accepted article 50 notification, the 29 March is the end of the two years provisioned by article 50.

I posted before that the Withdrawal Agreement (and associated Political Declaration) awaits ratification by the UK and the EU Parliaments.

In the event that the Agreement is unratified on 29 March (no deal, or disorderly Brexit, or unnegotiated Brexit) then the contingency arrangements provisioned by draft and enacted laws in the UK, the EU and in various EU member states, will kick in.

A draft EU contingency regulation (2019 EU Budget) sets 18 April as the date by which the UK should have taken action (as respects the 2019 EU Budget).

The EU contingency regulations (draft) are – here.

Please continue to follow this Blog.

Ireland Omnibus Bill (Ireland Brexit)

UPDATE (3) : the Bill is now law and the Irish statute book is now ready for Brexit on 29th March 2019

UPDATE (2) : the Bill has passed the Dail and is now in the Seanad (the second Chamber)

UPDATE : the Bill is here.

Ireland publishes this morning its 15 part Omnibus Brexit Bill (I posted about this Bill coming down the line before). The Irish papers all carry reports of this – the Irish Times report is here.

The island of Ireland is the location of the international land border between the UK and the EU. I am travelling to Ireland again on Sunday, and will spend two weeks in the Borderlands (again).

I will update this Post (the update will not be emailed through, so if you are following this, then check back on the Blog itself), in due course, with a link to the published bill and a summary.

Trade Continuity (UK Brexit)

Disclaimer : this Blog does not focus on trade tariffs and processes per se

The UK Government today (21st Feb 2019) published revised guidance to UK and international businesses that use preferential trade terms under existing agreements between the EU and third countries to advise them about a scenario in which the UK leaves the EU without a Withdrawal Agreement (no deal, or unmanaged Brexit).

While some continuity agreements are likely to be concluded by exit day, the DIT Secretary Statement (of today) asserts it is the duty of government to produce a highly cautious list of those that both may and will not be in place in order that businesses and individuals ensure that they are prepared for every eventuality.

A list of the agreements and guidance of what to do in no deal is here.

The DIT Secretary statement continues –

Scope of the Trade Continuity programme

The Government is seeking continuity for existing EU trade agreements in which the UK participates as a member of the EU. These agreements constitute around 11% of our trade. These agreements also cover a wide variety of relationships, including:

• Free Trade Agreements (FTAs);

• Economic Partnership Agreements (EPAs) with developing nations;

• Association Agreements, which cover broader economic and political cooperation;

• Mutual Recognition Agreements (MRAs) and;

• Trade agreements with countries that are closely aligned with the EU

Businesses in the UK and partner countries are eligible for a range of preferential market access opportunities under the terms of these agreements. These can include, but are not limited to:

• preferential duties for goods, including reductions in import tariff rates and quotas for reduced or nil rates of payable duties;

• quotas for the import of goods with more relaxed rules of origin requirements;

• enhanced market access for service providers;

• protection from discrimination in public procurement opportunities across a range of sectors;

• allowing parties to mutually recognise conformity assessment procedures;

• the ability to complete mandatory inspections and tests on products close to the place of production; and

• common standards on intellectual property.

Progress Update

To date, the UK has signed trade agreements with Switzerland, Chile, the Faroe Islands, members of the Eastern and Southern Africa (ESA) Economic Partnership Agreement, Israel and the Palestinian Authority.

The UK is also close to formal agreement on text with Fiji and Papua New Guinea (Pacific) and arrangements are being made for their signature. It is likely these agreements will be transitioned in time for day one of exit.

The UK has also signed Mutual Recognition Agreements that allow continuity of trade with Australia and New Zealand, and the United States. These MRAs mean that UK exporters can ensure goods are compliant with trading partners’ technical regulations before they depart the UK.

Discussions with other partners continue with the aim of replicating the effects of existing EU agreements as far as possible. The DIT Secretary statement asserts –

We are continuing to engage with those other partner countries to conclude agreements in time for exit day. Particularly intensive discussions are, for instance, happening now with partners such as SACU+M, EEA, Canada and South Korea.

Some agreements that will not be in place for exit day – these are Andorra, Japan, Turkey, and San Marino.

As the statement points out, the UK’s trade relationships are not just determined by trade agreements; the UK also participates in the EU’s Generalised Scheme of Preferences (GSP), which allows developing countries, including Least Developed Countries and low to lower-middle income countries to receive preferential access to the UK market. The Government fully intends to continue the existing market access provided by these unilateral preference schemes.

To do so we have taken the necessary powers through the Taxation (Cross-border Trade) Act 2018 to allow us to continue providing non-reciprocal reductions in tariffs to developing countries. Through this, the current beneficiaries of the EU’s GSP will be able to export to the UK after our EU exit on the same terms as at present. We will shortly be laying the necessary secondary legislation in Parliament.

This means that some countries will continue to be eligible for preferential tariff treatment under the UK’s newly established independent trade preferences scheme even if the relevant EU-partner country trade agreement has not yet been transitioned into a UK-partner country agreements.

Details of non-EU countries with whom the UK currently has in place arrangements for preferential trade, including both free trade agreements and unilateral preferences is here.

(status of) Withdrawal Agreement & Political Declaration (EU-UK FTA)

UPDATE : these documents failed this evening (12th March 2019) at the second time of asking for ratification by the UK Parliament.

The EU has now published (in the Official Journal) both the Withdrawal Agreement and the Political Declaration – here.

Accompanying this is an EU Council Decision – here.

A couple of points to make :

(1) ratification of the Withdrawal Agreement (the “deal”) is required by both the UK and the EU Parliaments,

(2) the Political Declaration is a non-binding legal statement of intent, that may form the basis for the EU-UK FTA,

(3) the Withdrawal Agreement (if ratified) provides for a transition period during which — notwithstanding all consequences of the United Kingdom’s withdrawal from the Union as regards the United Kingdom’s participation in the institutions, bodies, offices and agencies of the Union — Union law, including international agreements, will be applicable to and in the United Kingdom.

The Commission, on behalf of the Union and of Euratom, would therefore notify the other parties to these agreements that the United Kingdom is to be treated as a Member State for the purposes of those agreements during the transition period.

UK Carbon Emissions Tax (UK Brexit)

I posted before about the Carbon Emissions Tax that will be applied in place of EU ETS (the EU carbon trading scheme). The UK Government issued yesterday further instructions on this Carbon Emissions Tax. These instructions are here.

UK Carbon Emissions Tax – imminent key dates

From 30 March 2019, if there is no transition, business emissions from 1 January 2019 onwards will no longer be covered by the EU ETS, so UK businesses will no longer need to surrender allowances for these emissions at the end of each year.

However, all stationary installations currently participating in the EU ETS should continue to comply with the regulations for the monitoring, reporting and verification of greenhouse gases. These regulations will underlie the new UK Carbon Emissions Tax.

The UK Carbon Emissions Tax is provided for in the Finance Act 2019 and will be introduced on 1 April 2019 – the reporting period for stationary operators will be 1 April 2019 to 31 December 2019. The 2019 tax will be set at £16 per tonne. Subject to state aid approval, the scheme to compensate energy-intensive industries for the indirect costs of the EU ETS would remain in place to compensate for the indirect emission costs of the new Carbon Emissions Tax.

The Finance Act 2019 is now added to the Brexit Law List, in Cardinal Environment EHS Legislation Registers & Law Checklists.

Accounts administered by the UK in the EU ETS allowance registry and the Kyoto Protocol registry will be blocked from the point of the UK leaving the EU. Operators wishing to retain access to their allowances after the withdrawal date should consider opening an account in another member state’s registry for this purpose, and should consider the amount of time this is likely to take. Clean Development Mechanism project developers with a UK Letter of Authority will also need a letter of approval from a different Designated National Authority.

Until further notice, the UK government will not issue or auction any 2019 EU ETS allowances. It remains possible for allowances to be purchased through the European Energy Exchange (EEX) auction platform, and on the secondary market. Operators should consider this when planning to meet 2018 compliance obligations. To make sure obligations will not be affected, the government brought forward the 2018 compliance year deadlines, published on 7 March 2018. This states that a company (in EU ETS) needs to report its 2018 emissions by 11 March 2019, and surrender allowances for those emissions by 15 March 2019.

Guidance on this was issued in October 2018 – here.

F-gases and ODS (UK Brexit)

I posted before that the UK will regulate Fluorinated Greenhouse Gases (F-gases) and Ozone Depleting Substances (ODS) from 30th March 2019, and that a Technical Notice had been issued on this (the Environment Agency would be the regulator).

New Guidance on Use and Trade is now issued.

The new Brexit Use and Trade Guidance is here. I will add this to the Brexit Law List, in Cardinal Environment EHS Legislation Registers and Law Checklists.

F-gas and ODS are substances used mainly as refrigerants, but also in other products including:

• medical inhalers

• fire extinguishers

• insulation foams

• solvents

• feedstocks for the manufacture of other chemicals

This affects UK companies that :

• produce, supply, import, export or use bulk F-gas or ODS

• manufacture or import equipment containing F-gas or ODS

In addition, the document applies to the service of :

• commercial, industrial and transport refrigeration and air conditioning systems

• other products containing F-gas or ODS

New UK ODS and F–gas regulations transfer most of the requirements of the EU regulations into UK law. These are found in the Brexit Law List.

The UK will continue to:

• restrict ODS

• use the same schedule as the EU to phase down HFCs (hydrofluorocarbons, the most common type of -gas) by 79% by 2030 relative to a 2009 to 2012 baseline.

That means UK F-gas quotas will follow the same phase down steps as the EU:

• limited to 63% of the baseline in 2019 and 2020

• reducing to 45% of the baseline in 2021

Most of the rules for F-gas and ODS will not change. However, the UK will have separate quota systems, and the IT systems UK businesses use to manage quotas and report on use will change.

UK companies will need to comply with EU regulations on products they place on the EU market after exit (since after 30 March, the UK will be a ‘third country’).

Scotland, Wales and Northern Ireland have all decided to remain part of a single, UK-wide system if the UK leaves the EU with no deal on 29 March 2019.

The Environment Agency will administer the systems for the whole of the UK.

F-gases

When the UK leaves the EU, many of the rules for F-gases will not change, including requirements or restrictions:

• to prevent intentional release of F-gases

• to prevent the unintentional release of F-gases during production and use

• to minimise and repair leakages

• to check leaks and keep records

• to use leakage detection systems

• to provide evidence that trifluoromethane produced during the production of F-gases has been destroyed

• to recover F-gases from equipment for recycling, reclamation or destruction

• on placing certain products and equipment on the market

• on sales of F-gases to businesses which do not hold the relevant certificates or attestations

• for product and equipment labelling

• on the use of certain F-gases for magnesium die-casting, vehicle tyres or servicing certain refrigeration equipment

Requirements in the UK will also not change on:

• the individual qualifications and company certifications you need to install, service, maintain, repair, decommission or check for leaks in certain equipment or the recover F-gas

• the content and requirements of training and certification programmes

• the validity of existing certificates and training attestations, including those issued by EU member states both before and after the UK leaves the EU.

ODS

When the UK leaves the EU, the rules will stay the same for ODS that a UK company :

• imports

• supplies

• uses

• recovers

• destroys

UK companies will have the same responsibilities to:

• maintain equipment

• control leaks

Rules on how a UK company supplies and uses ODS will remain the same, including for:

• feedstock

• process agents

• destruction

• reclamation

• essential laboratory and analytical use

• halons for certain critical uses

NOTE : the above is written for the situation “post 30 March if there is no deal in place”. This is a short hand. Please keep following the Blog for updates.

Road Haulage (NI Brexit)

UPDATE : the EU Council has now agreed its position on basic road connectivity – here.

There is uncertainty in the haulage industry about what will happen at EU borders if the UK leaves without a Brexit deal next month.

Back in November, the UK Government issued guidance to UK hauliers stating that they “might need ECMT permits to transport goods in the EU and European Economic Area (EEA)” if there is no deal by 29 March.

The European Conference of Ministers of Transport (ECMT) permits can be used in a list of 43 countries which have signed up to the international arrangement.

The deadline for 2019 applications expired on 18 January 2019 and on Saturday night, many hauliers were informed on whether or not they were successful. I posted earlier about the deadline.

ECMT permits were over-subscribed and allocated on a points-based system, with higher scores awarded to firms who make a larger number of journeys into EU member states.

It would appear the Department for Transport (DfT) did not take into account journeys to the Republic of Ireland from Northern Ireland operators, whereas English, Scottish or Welsh hauliers were credited with their journeys to the Republic of Ireland.

Just over 1,200 permits were available for the UK as a whole and it is likely only 60-70 were made available to Northern Ireland firms.

In its guidance issued last year, the Government said it expected that Northern Ireland hauliers “will not need an ECMT permit” to drive to or through the Republic of Ireland.

It stated it would not require Republic of Ireland hauliers to have ECMT permits to operate in Northern Ireland.

It added that the UK was seeking a reciprocal agreement from the Irish government to allow Northern Ireland hauliers to travel across the Irish border without a permit.

I posted earlier that the European Commission (in its Contingency Plan) has proposed legislation that would allow UK hauliers basic rights (on a reciprocal basis) to conduct operations to, from and through the EU for a limited period of nine months after exit, if there is no deal.

“The Commission’s proposal will need to be agreed by the Council and European Parliament, and is being considered by both institutions urgently.” (UK Transport Minister, by statement last week)

The minister said he laid legislation before Parliament last week to provide for that access. [this will be included in the Brexit Law List, added to Cardinal Environment EHS Legislation Registers and Law Checklists]

HSA Brexit Guide (Ireland Brexit)

From 30th March 2019, the UK will become a “third country”. The Health and Safety Authority (HSA) is the Competent Authority for a range of EU Regulations and Directive in Ireland.

The HSA has now issued a Brexit Overview document – here.

Cardinal Environment will be setting up a Brexit Law List for Ireland EHS Legislation Systems and Checklists, shortly. We will place this and other guidance on that list.

This HSA Brexit Overview reminds :

(1) Products imported from the UK from 30 March 2019 need to be EU compliant.

(2) Irish companies need to know the full supply chain for all their products (for example machinery, chemicals) and how it is linked to the UK or NI, including via distributors.

(3) Unless Irish companies can source their product from another EU supplier, the Irish company may become an EU importer after Brexit, with additional legal responsibility for compliance of the product with EU law. I posted about this recently.

(4) After Brexit, Irish companies will no longer be able to rely on notified bodies based in the UK to undertake 3rd party conformity assessments required under relevant EU law. They will need to source a notified body legally designated to carry out conformity assessments in the EU27.

This applies to Chemicals, Machinery, Transportable Pressure Equipment, and other classes of Industrial Products.

The above also applies in the rest of the EU27, and in the EEA.