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EU ready to terminate UK data adequacy decision with immediate effect

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The UK has announced that it intends to introduce “common-sense data laws” and to bring an “end to box-ticking” with a new more flexible approach to data adequacy. A European Commission spokesperson told journalists on Thursday (26 August) that it will be ready to suspend or terminate the agreement if there are “problematic developments.” 

Asked about the UK proposal, which is more of statement of intent, the European Commission said: “We have seen the announcement and as you know we do not comment on announcements, we do however monitor very closely any developments related to the UK’s data protection rules. 

“When adopting the UK adequacy decisions, the Commission was fully aware of the risk of possible further divergence of the UK system from the EU system. This is why in case of problematic developments that negatively affect the level of protection the EU decision can be suspended, terminated or amended at any time by the Commission. This can be done immediately in case of justified urgency. So we will continue to ensure that Europeans' data will be protected by strong safeguards when crossing the channel.”

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In June the EU decided that the UK’s current rules, which are currently largely the same as those in the EU General Data Protection Regulation (GDPR) and Law Enforcement Directive (LED), allow the continued flow of personal data from the EU and EEA to the UK. 

At the time, the UK minister responsible, Oliver Dowden, presented the EU decision as an important one for UK businesses, saying: “After more than a year of constructive talks it is right the European Union has formally recognized the UK’s high data protection standards.

“This will be welcome news to businesses, support continued co-operation between the UK and the EU and help law enforcement authorities keep people safe.”

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TechUK CEO Julian David said: “Securing an EU-UK adequacy decision has been a top priority for techUK and the wider tech industry since the day after the 2016 referendum. The decision...is of vital importance to UK-EU trade as the free flow of data is essential to all business sectors.”

TechUK's Director of Markets Matt Evans welcomed the announcement, but underlined that new routes must be trusted and have high privacy standards to maintain access to existing data flows, such as from the EU, as well as opening up global opportunities.

Like the UK proposal to have a UK as well as a CE marking on goods, the additional regulations that diverge from the EU’s could represent a non-tariff barrier, rather than a new opportunity. The UK will have to ensure that it maintains the EU’s standards, while the UK still hopes that through other forums, such as the G7, it can maintain a foothold on influencing global rules. 

Brexit

Brexit impact ‘will get worse’ with supermarket shop to cost more and some EU products vanishing from shelves

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The full impact of Brexit on both businesses and consumers will not be felt until next year with shortages set to worsen in sectors ranging from food to building materials, a leading customs expert has claimed, writes David Parsley.

Simon Sutcliffe, a partner at tax and advisory firm Blick Rothenberg, believes Government delays in implementing post-Brexit customs laws have “softened the impact” of the UK’s exit from the European Union, and that “things will get worse” when they are finally brought in from January 2022.

Despite leaving the EU on 1 January 2020, the Government has delayed many of the customs laws that were due to come into force last year.

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The requirement for pre-notification of arrival in the UK of agri-food imports will be introduced on 1 January 2022 as opposed to the already delayed date of 1 October this year.

The new requirements for Export Health Certificates will now be introduced even later, on 1 July next year.

Controls to protect animals and plants from diseases, pests, or contaminants will also be delayed until 1 July 2022, as will the requirement for Safety and Security declarations on imports.

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When these laws, which also include the customs declaration system, are brought in Mr Sutcliffe believes the food and raw material shortages already experienced to some extent – especially in Northern Ireland – will worsen on the mainland with some products disappearing from supermarket shelves for the foreseeable future.

Sutcliffe, who was among the first to predict the truck driver shortage and border issues in Northern Ireland, said: “Once these extra extensions come to an end we’re going to be in a whole world of pain until importers get to grips with it just like the exporters from the UK to the EU have had to already.

“The cost of the bureaucracy involved will mean many retailers will simply not stock some products from the EU any longer.

If you know your fruit delivery is stuck in a UK port for 10 days waiting to be checked, then you’re not going to bother importing it as it’ll go off before it even reaches the store.

“We’re looking at all kinds of products disappearing from supermarkets, from salami to cheeses, because they will just be too expensive to ship in. While a few boutique delicatessens may stock these products, they will become a more expensive and be harder to find.”

He added that the supermarket shop will also face steep price rises as the cost of importing even basic products such as fresh meat, milk, eggs and vegetables will cost retailers more.

“The retailers will not have much choice but to pass on at least some of the increased costs to the consumer,” said Sutcliffe. “In other words, consumers will have less choice and will have to pay more for their weekly shop.”

A spokesman for No 10 said: “We want businesses to focus on their recovery from the pandemic rather than have to deal with new requirements at the border, which is why we’ve set out a pragmatic new timetable for introducing full border controls.

“Businesses will now have more time to prepare for these controls which will be phased in throughout 2022.”

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Europe ministers say trust in the UK at a low ebb

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Commission Vice President Maroš Šefčovič, updating ministers on the latest developments, said that trust needed to be rebuilt and that he hopes to find solutions with the UK before the end of the year. 

European ministers meeting for the General Affairs Council (21 September) were updated on the state of play in EU-UK relations, in particular with regards to the implementation of the protocol on Ireland/Northern Ireland.

Šefčovič updated ministers on the latest developments, including his recent visit to Ireland and Northern Ireland, and ministers reiterated their support for the European Commission's approach: “The EU will continue to engage with the UK to find solutions within the framework of the protocol. We will do our utmost to bring back predictability and stability for the citizens and businesses in Northern Ireland and to ensure they can make the most of the opportunities provided by the protocol, including access to the single market.”

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The vice president said that many ministers had spoken in the debate at the Council meeting with concern over whether the UK was a trustworthy partner. French Europe Minister Clement Beaune said on his way into the meeting that Brexit and the recent dispute with France over the AUKUS submarine deal should not be mixed up. However, he said that there was an issue of trust, saying that the UK was a close ally but that the Brexit agreement was not being fully respected and that trust was needed in order to move on. 

Šefčovič aims to resolve all outstanding issues with the UK by the end of the year. On the UK’s threat to make use of Article 16 in the Protocol which allows the UK to take specific safeguarding actions if the protocol results in serious economic, social or environmental difficulties that are liable to persist or to a diversion of trade, Šefčovič said that the EU would have to react and that ministers had asked the Commission to prepare for any eventuality. Nevertheless, Šefčovič hopes this can be avoided.

Northern Ireland is already experiencing trade diversion, both in its imports and exports. This is due in large part to the very thin trade deal that the UK has chosen to pursue with the EU, despite being offered less damaging options. Any safeguarding measures must be restricted in terms of scope and duration. There is also a complicated procedure for discussing safeguarding measures laid out in annex seven of the protocol, which involves notifying the Joint Committee, waiting a month to apply any safeguards, unless there are extraordinary circumstances (which the UK will no doubt claim there are). The measures will then be reviewed every three months, in the unlikely event that they are found to be well grounded.

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Britain delays implementation of post-Brexit trade controls

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Britain said on Tuesday (14 Sseptember) it was delaying the implementation of some post-Brexit import controls, the second time they have been pushed back, citing pressures on businesses from the pandemic and global supply chain strain.

Britain left the European Union's single market at the end of last year but unlike Brussels which introduced border controls immediately, it staggered the introduction of import checks on goods such as food to give businesses time to adapt.

Having already delayed the introduction of checks by six months from April 1, the government has now pushed the need for full customs declarations and controls back to Jan. 1, 2022. Safety and security declarations will be required from July 1 next year.

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"We want businesses to focus on their recovery from the pandemic rather than have to deal with new requirements at the border, which is why we've set out a pragmatic new timetable for introducing full border controls," Brexit minister David Frost said.

"Businesses will now have more time to prepare for these controls which will be phased in throughout 2022."

Industry sources in the logistics and customs sector have also said the government's infrastructure was not ready to impose full checks.

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