GB-NI Traded Goods (Northern Ireland)

Northern Ireland is part of the UK’s Internal Market, and at the same time has access to the EU’s single market for traded goods; a list of EU rules applies to Northern Ireland goods (initially established by the Ireland/Northern Ireland Protocol to the 2018 EU-UK Withdrawal Agreement, and then updated as The Windsor Framework).

Today (31st January 2024), the UK Government has announced further changes – [the document is here]

(1) the UK Internal Market Act 2020 will be amended to copperplate access for Northern Ireland goods into GB –

* to prohibit exit procedures on goods moving from Northern Ireland to GB

* to guarantee unfettered access for all routes into GB (including for example via Dublin)

* to ensure only agrifood goods connected to registered NI food and feed operators will be qualifying Northern Ireland goods for the absence of SPS checks, controls and processes

(2) a new Act of Parliament will bar the UK Government from reaching a future agreement with the EU which has an adverse effect on the operation of the UK’s internal market

(3) section 7a of the EU Withdrawal Act 2018 will be amended to ensure acceptance of new EU rules in Northern Ireland (“dynamic alignment”) will be subject to the Stormont Brake democratic consent and scrutiny envisaged by the Windsor Framework (once the Northern Ireland Executive is up and running)

[update : in addition, when Parliament is considering new legislation, the UK Government will ensure Parliament has the information needed about any impacts on the internal market and measures necessary to protect Northern Ireland’s place in the internal market, to decide how to proceed. The Government will legislate to require that a Minister in charge of a Bill must assess whether or not it has an impact on trade between GB and Northern Ireland and, if so, make a statement to Parliament setting out whether the legislation would have significant adverse implications for Northern Ireland’s place in the UK internal market. Where primary legislation does carry such implications for the internal market, the Government will set out any measures it proposes to take to protect the internal market.]

(4) the “green lane” concept will be replaced by a new UK internal market system, that will sit alongside the “red lane” concept of goods at risk of moving onwards to the EU. Membership of the UK Internal Market Scheme, and for agrifood retail goods the Northern Ireland Retail Movement Scheme, will still be required.

(5) the indefinite extension of recognition of CE marking across 18 existing regulatory categories for products across the UK already in place, will be extended to other product categories.

Note : these announcements do not extend to chemicals per se – the trader is advised to look closely at the goods moved under the UK Internal Market Scheme. An agreement is in place for medicines, but not veterinary medicines (the grace period runs out shortly).

Border Target Operating Model (UK)

The UK’s Border Target Operating Model puts in place customs and SPS (sanitary and phytosanitary) controls applicable to goods moving from the EU to Great Britain (GB). These were already in place from 1st Jan 2021 for goods moving from GB to the EU. The Windsor Framework governs goods moving from GB to Northern Ireland. There is no “hard border” between Northern Ireland and Ireland. Reminder: Northern Ireland is a six counties province of the island of Ireland.

31st January 2024 is the first deadline (EU to GB).

Goods will need to complete import processes if they are being imported directly from the EU, including Ireland, into GB (not moving from or through Northern Ireland).

Goods moving from Northern Ireland to GB through Irish ports will also have to complete import processes if they are:

* non-qualifying Northern Ireland goods

* excise goods (includes energy products)

* goods that do not move directly to an Irish port once they have left Northern Ireland, for example goods that are held in storage in Ireland.

Declarations will no longer be able to be delayed. Ports will be required to control these goods moving from the EU (including Ireland) to GB, meaning that unless they have received customs clearance they will not be released from the port.

Here is information about moving qualifying goods from Northern Ireland to the rest of the UK (ie GB).

Businesses making a full import declaration or simplified frontier declaration on the UK Customs Declaration Service (CDS) for goods moving from the EU, including Ireland, to GB (including for excise goods) will no longer be required to ‘arrive’ their declaration by the end of the next working day after arriving in GB. For goods being entered into excise duty suspense, the entry onto the Excise Movement and Control Systems (EMCS) must be made by the time they arrive in GB.

If a trader is moving goods from Northern Ireland to GB via Ireland, including qualifying Northern Ireland goods, some Irish customs requirements will need to be complied with to exit through a port in Ireland and the trader will need to check Irish customs guidance.

Import declarations will not be needed for qualifying Northern Ireland goods moving directly from Northern Ireland or indirectly through Ireland to GB, in line with the UK Government’s commitment to unfettered access.

Further information (Northern Ireland traders) is here.

New Deforestation-free Products Rules (EU)

On 29 June 2023, the EU’s Regulation on deforestation-free products entered into force. The document is here. The new Regulation repeals the EU Timber Regulation.

Under the EU Deforestation-free Products Regulation, any operator or trader who places products that might be derived from deforestation on the EU market, or exports from it, must be able to prove that the products do not originate from recently deforested land or have contributed to forest degradation.

The products involved include commodities like cattle, wood, cocoa, soy, palm oil, coffee, rubber, and some of their derived products, such as leather, chocolate, tyres, or furniture.

Operators and traders have 18 months from 29 June 2023 to implement the new rules. A longer adaptation period applies to micro and small enterprises.

FAQs is here. The new rules apply to exporters to the EU.

The EU Timber Regulation applies in Northern Ireland; but the action to be taken by the UK Government on the matter is as yet unclear.

New UK CBAM (UK)

Happy New Year!

On 18th December 2023, the UK government announced it would bring in a UK carbon border adjustment mechanism (CBAM) by 2027, one year later than the EU.

The announcement is here. Further detail is here.

There is little detail so far, save that the UK CBAM looks to be an EU-style carbon levy, applying to similar industries.

The design and delivery of the UK CBAM will be subject to further consultation in 2024.

Exporters to the EU will already be providing data to the EU; the transition phase of EU CBAM came into force on 1st October 2023.

The situation in Northern Ireland is as yet unclear. EU CBAM will be ‘new legislation’ as respects the Northern Ireland/Ireland Protocol. It would need to be formally notified to the UK, if the EU wishes to apply its CBAM in that jurisdiction to ‘red list’ goods (goods at risk of entering the EU).

EU CBAM reminder (EU)

REMINDER – as Blog posted earlier, the EU CBAM (carbon tax on certain imports) starts 1st October. Further information is here.

Reporting periods are 4x a year (not annual). The first reporting period ends 31 January 2024.

The obligation rests with the importer (or their representative) of affected goods from third countries into the EU.

EU CBAM (import tax) applies to goods and precursors in specified CN (combined nomenclature) cement, iron and steel, aluminium, fertilisers, electricity and hydrogen 8-digit codes. In practical terms, EU CBAM will affect any trader or sector of the EU economy that sources iron/steel, aluminium, cement and fertilisers from non-EU countries or countries that do not apply the EU Emissions Trading Scheme. Import quantities of a value less than €150 will not be subject to CBAM provisions. The affected CN codes are those listed in Annex I of Regulation (EU) 2023/956 – here.

The report must include the following information: the total quantity of each type of goods, the actual total embedded emissions, the total indirect embedded emissions (emission due to electricity use), it’s method of production and the carbon price due in the country of origin for the embedded emission in the imported goods.

CBAM reports must be submitted via the CBAM Transitional Registry which will be available from 1st October. The first report will be due in January 2024.

During the transitional period, no charges will be levied on imports of affected goods. But inaccurate reporting of carbon emission levels on imports will be subject to fines levied in the EU member state where the import takes place.

Eventually, when EU CBAM is fully implemented, emissions data will have to be fully and independently verified, but this is not required during the initial transitional period.

When fully implemented in 2026, importers will have to purchase CBAM certificates (less any carbon price paid locally via any in-country ETS or otherwise agreed with the EU and less any free allowances allocated under the EU ETS) to cover the GHG emissions embedded in affected products imported into the EU. The cost of EU CBAM certificates will mirror that of EU Emissions Trading System allowances. No charges will be imposed until January 2026.

Carbon Border Adjustment Mechanism (EU )

The EU’s carbon border adjustment mechanism (CBAM) entered into force on 16th May 2023 and will apply from 1st October 2023, with the first reporting period for importers ending 31st January 2024.

The reporting obligations and information sought from EU importers of CBAM goods, as well as the provisional methodology for calculating embedded emissions released during the production process of CBAM goods will be further specified in an Implementing Regulation to be adopted by the Commission after consulting the CBAM Committee, made up of experts from EU Member States. This document is expected shortly.

The EU’s CBAM will initially apply to imports of certain goods and selected precursors whose production is carbon intensive and at most significant risk of carbon leakage: cement, iron and steel, aluminium, fertilisers, electricity and hydrogen.

During this period, importers of goods in the scope of the new rules will report greenhouse gas emissions (GHG) embedded in their imports (direct and indirect emissions), and not make financial payments or adjustments. Indirect emissions will be covered in the scope after the transitional period for some sectors (cement and fertilisers), on the basis of a methodology to be defined in the meantime.

The draft Implementing Regulation on reporting requirements and methodology provides for some flexibility when it comes to the values used to calculate embedded emissions on imports during the transitional phase. During the first year of implementation, companies will have the choice of reporting in three ways: (a) full reporting according to the new methodology (EU method); (b) reporting based on equivalent third country national systems; and (c) reporting based on reference values. As of 1 January 2025, only the EU method will be accepted.

Importers are asked to collect fourth quarter data as of 1 October 2023, their first report to be submitted by the end of January 2024.

Once the permanent system enters into force on 1 January 2026, importers will declare each year the quantity of goods imported into the EU in the preceding year and their embedded GHG. They will then surrender the corresponding number of CBAM certificates. The price of the certificates will be calculated depending on the weekly average auction price of EU ETS allowances expressed in €/tonne of CO2 emitted. The phasing-out of free allocation under the EU ETS will take place in parallel with the phasing-in of CBAM in the period 2026-2034.

Find the EU’s Q&A here.

Find the EU’s CBAM Regulation here.

Find the EU’s Factsheet here.

List of Disapplied EU SPS Laws (Northern Ireland)

UPDATE : the issued EU Regulation is here.

The Windsor Framework includes an agreement between the EU and the UK, that will disapply a list of EU SPS rules to goods entering Northern Ireland in certain circumstances. I posted before about the Windsor Framework, more generally. The Windsor Framework amends the Ireland/Northern Ireland Protocol to the EU-UK Withdrawal Agreement.

The disapplication list is found in Annex 1 to the Proposal for a REGULATION OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL on specific rules relating to the entry into Northern Ireland from other parts of the United Kingdom of certain consignments of retail goods, plants for planting, seed potatoes, machinery and certain vehicles operated for agricultural or forestry purposes, as well as non-commercial movements of certain pet animals into Northern Ireland.

The document is published as COM(2023) 124 final and Annex I is here. It is not yet law.

SPS is Sanitary and Phytosanitary.

The original Ireland/Northern Ireland protocol applied the same rules to agrifood trade between Cairnryan and Larne as between Holyhead and Dublin.

The Windsor Framework will set up a new “green lane” agrifood retail scheme. Part 2 of COM(2023) 124 final provides for the core elements of this “green lane” for agrifood retail movements to Northern Ireland. Part 2 is found here.

The “green lane” will allow traders moving agrifood goods to the final consumer in Northern Ireland to benefit from a unique set of arrangements that will enable an entire truck to move on the basis of a single certificate, without routine physical checks, and on the basis of UK food and drink safety standards.

The “green lane “ will be available to all such traders who are retailers, wholesalers, caterers, and persons providing food to public institutions like schools and hospitals.

Articles 4 and 5 (in Part 2) set out the requirements goods must meet in order to qualify for these unique arrangements. This includes products being prepacked and being made available only on the NI market for final consumers. The scheme is not limited to goods from Britain or the EU. Goods from the rest of the world can move under this scheme, either where they are processed in the UK, where they meet UK public health standards and pose no disease risk, or where disease risks exist and the UK has chosen to take the same approach to protecting against the same pests and diseases as the EU.

Products moved under the “green lane” scheme will be subject to UK and not EU rules for public health, marketing, organic, labelling, genetic modification, and drinks such as wines, spirits and mineral waters. Annex I sets out the list of EU rules that will be disapplied.

Product labelling will be introduced from October 2023 onwards.

Part 3 sets out the provisions for the movement of plants and plant products (other than seed potatoes) under the “green lane” scheme. These arrangements will be the same as those for plant movements within the UK.

Part 4 sets out the provisions for the movement of pets. Northern Ireland pet owners will therefore continue to move their pets to Ireland and the EU using the EU pet passport.

Article 11 removes the ban on movement of seed potatoes.

Cardinal Environment will identify the EU rules that will be disapplied for the “green lane” scheme, in Northern Ireland Registers & Checklists.

We will also highlight the disapplied EU rules in the REUL Deletion List which is supplied in every UK jurisdiction Registers & Checklists system.

Windsor Framework (Northern Ireland)

27th February 2023 saw political agreement reached between the EU and the UK on the Windsor Framework. The Windsor Framework is a set of new arrangements for agri-foods and medicines (and seeds, plants, trees and agri machinery; customs; VAT; and state aid) presently regulated by the Ireland/Northern Ireland Protocol of the EU-UK Withdrawal Agreement. Further information is in this UK command paper here.

The Ireland/Northern Ireland Protocol (known as the Northern Ireland Protocol or NIP in the UK) entered into force on 1st February 2020, and its provisions applied from 1st January 2021.

Agri-foods

A general single certificate will be used for mixed loads of agri-food goods consumed in Northern Ireland.

Identity checks will be reduced to 5% (for agri-foods consumed in Northern Ireland) – specifically – from 1 October 2023, the frequency rate of identity checks will be 10% of all consignments of retail goods for consumption in Northern Ireland), and 8% by 1 October 2024 when all milk and dairy products are individually marked. From 1 July 2025, the frequency rate will be 5% of all consignments of retail goods, when all retail goods are individually marked.

Physical checks (as respects agri-foods consumed in Northern Ireland) will be carried out in conjunction with identity checks using a risk-based and intelligence-led approach.

Documentary checks will be carried out on all the general certificates accompanying the consignments of retail goods for consumption in Northern Ireland. These checks can be performed remotely and electronically.

UK public health standards (e.g. level of additives in food) will apply to goods moved for end consumption in Northern Ireland. Previously prohibited chilled meats, such as sausages, will be allowed.

Certificates will not be needed for organics and wine (consumed in Northern Ireland).

Agri-foods originating in the rest of the world may enter Northern Ireland (for consumption in Northern Ireland) through Britain when UK conditions are identical to EU ones (specific list of products, including New Zealand lamb and vegetables).

The UK will provide EU representatives with access to relevant UK IT databases.

Labelling “not for EU” will be deployed for agri-foods consumed in Northern Ireland.

The movement of retail goods will be monitored, with traceability and listing of the dispatching and receiving authorised establishments.

Facilitations will be suspended to address specific problems or systematic failures of compliance with the new arrangements.

It will not be a dual regulatory regime. UK public health standards will apply to agri-foods entering Northern Ireland from Britain for consumption in Northern Ireland. But EU requirements for animal health and plant health in Northern Ireland will remain fully in place.

The UK announced in December that it will construct permanent SPS Inspection Facilities. Deployment of SPS Inspection Facilities will be gradual – 1 October 2023 for the delivery of enhanced facilities and 1 July 2025 for the delivery of final facilities.

Re “not for EU” labeling – from 1 October 2023, prepacked meat and fresh milk will be individually labelled. Goods sold loose need only to be labelled at box level (e.g. apples) and easily visible signs would need to be placed next to the price tag on the shelves in the supermarkets. Posters would also be needed, placed in the supermarkets so that consumers know that the goods are not for EU. As of 1 July 2025, all retail goods (other than goods sold loose) will be individually labelled except those not subjected to official controls at border control posts in the EU (e.g.: confectionery, chocolate, pasta, biscuits, coffee, tea, liqueurs, canned fruit and vegetables, ketchup and similar shelf-stable products).

Medicines

In April 2022, the EU amended its legislation to ensure the uninterrupted supply of generic medicines from Britain to Northern Ireland.

Novel medicines will be authorised and placed on the market in Northern Ireland in accordance with UK rules and UK authorisation procedures only. EU rules and authorisations will not apply to these medicines anymore. In addition, prescription medicines placed on the Northern Ireland market will not carry the EU required unique identifier/barcode to distinguish them from those placed on the EU market.

Individual packs of all medicines placed on the Northern Ireland market will be labeled “UK only”.

Stormont Brake

This is a new mechanism that will allow the UK government, at the request of 30 Members of the Legislative Assembly in Northern Ireland (Stormont), in the most exceptional circumstances, as a last resort as set out in a unilateral UK Declaration (statutory instrument to be debated next Wednesday in Parliament) to stop the application of amended or replacing provisions of NIP Retained EU law, that may have a significant and lasting impact specific to the everyday lives of communities in Northern Ireland.

The Stormont Brake is wider than Agri-foods and Medicines.

The UK Institute for Government has an explainer here.

Next Steps

A meeting of the Withdrawal Agreement Joint Committee will take place to adopt the necessary measures, translating the relevant joint solutions into legally binding commitments by making full use of its powers under the Withdrawal Agreement.

The European Commission has already made proposals to the Council for a Union position as regards, amongst other things, the decisions that need to be adopted in that meeting.

In addition, the Commission has also tabled three legislative proposals laying down, respectively, new rules for the movement of retail SPS goods, pets, seed potatoes, plants for planting and agricultural machinery from Great Britain to Northern Ireland, and rules giving effect to the solution found in the area of human medicines as well as certain categories of steel subject to tariff rate quotas. Once all translations are finalised, they will be transmitted to the European Parliament and Council. Once adopted and entered into force, the Commission will adopt any necessary implementing acts.

As identified earlier, the UK will debate next Wednesday in Parliament, a statutory instrument to give effect to the Stormont Brake.

Customs YouTube (UK)

Find here a useful YouTube guide to exporting – it doesn’t contain everything, but it is useful.

Disclaimer: Cardinal Environment Limited does not advise on Customs.

EU-UK Withdrawal Agreement Joint Committee (Northern Ireland)

The EU-UK Withdrawal Agreement (an international agreement) is overseen by a Joint Committee of the parties. This Joint Committee holds regular meetings, the last meeting was in June 2021. Specialised Committees operate under the auspices of the Joint Committee, these also meet regularly. The last meeting of the Specialised Committee for the Withdrawal Agreement Ireland/Northern Ireland Protocol was in September 2021. The EU tracks these meetings here. The UK tracks these meetings here. You will notice that the statements made re the Ireland/Northern Ireland Protocol are not Joint Statements. This is the case also re Gibraltar.

The next meeting of the Joint Committee is next week, but the agenda is not published.

Meanwhile, the Northern Ireland Executive is not operating (this has happened before). An executive order to stop checks on goods moving from Britain to Northern Ireland is stayed by the Northern Ireland High Court pending a decision of a Judicial Review of that order due early March (in 2021 the Northern Ireland High Court quashed a similar order). Also May is a month in which elections to the Northern Ireland Assembly are scheduled.

In advance of the Joint Committee meeting next week, Irish and EU representatives are discussing matters with Northern Ireland political parties, business and civil society representatives. Checks on goods moving between Britain and Northern Ireland are continuing. In the absence of a Northern Ireland Executive, civil servants will attend the Joint Committee.

The Joint Committee may also consider other matters (the Withdrawal Agreement has other protocols, and five Specialised Committees). The agenda will give more information.

I will update this post (on the blog platform) after the Joint Committee meeting.