A veritable sea serpent since the British voted for it by 51.9%, the Brexit finally came to fruition with the signing of a trade and cooperation agreement between the European Union and the United Kingdom in December 2020. "The road was long and full of pitfalls, but we have reached a balanced agreement," welcomed Ursula von der Leyen, the president of the European Commission.

Through its 1,300 pages, a new framework has been established for relations between the two parties, from January 1, 2021: trade, competition, fisheries, social security coordination, police and judicial cooperation, participation in European research programs (Horizon 2020, ITER, etc.), cooperation in civil nuclear energy ... This text thus completes the withdrawal agreement of October 17, 2019, relating in particular to the rights of European and British citizens and stability on the island of Ireland. In the future, it should be extended by new agreements, for example on financial services, or trade in electricity and gas.

Free trade but border controls

Now that the United Kingdom has become a third state of the European Union, their ties are based on the principle of free trade. There are no customs duties or quotas (Article GOODS.5 and GOODS.10), which is crucial when you consider that their trade was worth 700 billion euros per year until now. The UK even constituted, in 2019, the first trade surplus of France (€12.5bn), and is the partner of 120,000 French companies.

A few caveats, however... The exemption from customs duties depends on the rules of preferential origin: a good must be manufactured at least 50% in the United Kingdom or in Europe to benefit from it, with proof. This was discovered with astonishment by British retailers at the beginning of 2021, particularly those working in the ready-to-wear sector.

But above all, since the principle of mutual recognition is no longer valid, customs formalities have been reinstated, and new regulatory requirements have appeared for companies, whether British or European, importers or exporters. The costs of the re-establishment of borders are to be taken into consideration: the French government would have spent 200 million euros to hire 1,300 civil servants and to develop customs infrastructures, according to Olivier Dussopt, the Minister of Public Accounts. On the business side, some British estimates put the annual cost of administrative procedures at £7 billion, and some economists predict an increase of more than 5% in the price of exported products.

Trade in goods, what changes?

What are the practical changes in the regulatory environment? To import goods from the UK, a company must ensure that they meet the national technical and health requirements of the first European country it imports to. Where these products are subject to harmonized European regulations, they must comply with them and have been assessed by a body established in the European Union, not across the Channel. As an importer, the company must also fulfill new obligations: import license, labeling, European declaration of conformity, technical documentation...

Conversely, to export to the United Kingdom, British technical and sanitary requirements must be met. If the standards of exported products are governed by European legislation, they must nevertheless comply with British legislation. It may therefore be necessary to duplicate certain formalities with the British authorities (marketing authorization, approval, certification, etc.) and to obtain export licenses or certificates...

What happens to the CE marking?

On the UK market (England, Scotland, Wales), the CE mark remains valid for regulated products placed on the market before January 1, 2021, and marketed until January 1, 2023 (until June 30, 2023 for medical devices and in vitro diagnostic medical devices). Regulated products launched after 1 January 2021 must obtain UKCA (UK Conformity Assessed) marking, which can only be issued by a body established in the UK. LNE is currently organizing to help companies obtain this mark.

Within the European Union, the CE mark is still required, and must be issued by a body established in Europe from 1 January 2021.

Finally, since trade between Northern Ireland and the European Union is considered as intra-community for at least 4 years, CE marking is required on the Northern Irish market. Since January 1, 2021, the UKNI marking has been added, when the conformity assessment is carried out by a British body. The UKNI marking alone is not valid.

Conformity assessment: common guarantees

To help you find your way around, the European Union and the United Kingdom have published the list of products they regulate, as well as the references to the applicable technical regulations. They have also published the list of bodies designated to carry out conformity assessments, as well as information on their scope of designation: in Europe, on the NANDO Base; in the UK, on the Government website. For specific products, the assessment may be performed by government authorities. In this case, the fees to be paid by the companies must be limited.

In general, outside of medical devices, accreditation is the only way to demonstrate the competence of assessment bodies, whether in the EU or the UK. And where more than one body is designated, the authorities must ensure that companies have a choice (Article TBT.6). In addition, each party must ensure that they are independent of manufacturers, importers and other economic operators, and that there is no conflict of interest with the accreditation bodies.

Finally, conformity assessment bodies have the right to use subcontractors to carry out tests or inspections, including subcontractors located in the territory of the other party. This is a particularly interesting provision, as it should facilitate the recognition of tests performed by accredited laboratories located in both the United Kingdom and the European Union.

Removing any barriers to trade, and cooperating

To ensure that neither the European Union nor the United Kingdom creates barriers to trade in products, the December 30, 2020 agreement relies heavily on the WTO's Technical Barriers to Trade (TBT) Agreement. The TBT agreement aims to ensure that technical regulations, standards and conformity assessment procedures are non-discriminatory and do not create unnecessary barriers to trade.

Thus, each party is invited to use the relevant international standards as the basis for its technical regulations (Article TBT.4: Technical regulations). The international standards referred to are those developed by the international standards bodies recognized by the WTO (ISO, IEC, ITU, OIML, etc.).

If one party considers that a draft regulation or conformity assessment procedure of the other party constitutes an obstacle to trade, it is possible to open technical discussions (Article TBT.9). The agreement encourages the parties to cooperate on technical regulations, standards and conformity assessment procedures. A specialized committee on technical barriers to trade has been created for this purpose.

Many European cooperation bodies existed before the agreement, for various product categories (e.g. WELMEC for measuring instruments), and already welcomed the British.

For the time being at least, the British Standard Institute (BSI), the British standards body, will remain a member of the European standards organizations until 31 December 2021.