Frictionless Trade a Priority for UK Chems Industry in EU Exit Terms

Frictionless trade with the EU must be a priority in the terms of the UK’s exit from the bloc if the chemicals industry is to continue to strive, the UK’s Chemical Industries Association said on Tuesday.

On Wednesday, the CIA launched its guide about Brexit and the future, entitled Making Brexit work for the Chemical Industry alongside its strategic legal partner, Squire Patton Boggs.

The report details a number of key priorities for the industry, including:

> Frictionless trade with the EU

> Undisrupted UK/EU supply chains

> Development of new free-trade agreements

> Regulatory consistency

> Access to secure and cost-effective energy

> Access to highly skilled individuals

On trade, the report details that the European chemical industry is united in wishing to see zero tariffs on chemical trade between the UK and EU27 following Brexit.

It stressed the importance that chemical companies face only one change in how business is conducted between the UK and the EU, which should happen when the final bespoke deal has been agreed, adding that companies will need time to adjust to new trade requirements.

On chemicals regulation, the CIA called for regulatory consistency and continuity, saying that the implications of leaving the EU for the regulatory framework in which the UK chemical sector operates should not be underestimated.

“Many companies want to continue to secure access to the EU market place by remaining fully within REACH or as a minimum as close as possible to REACH,” the report stated.

“Any post-Brexit future needs to protect UK chemical industry’s existing compliance commitments, avoid duplication of costs, and assist our ability to negotiate free trade deals with the EU and beyond.”

The report also discusses the UK’s role in the EU’s Industrial Emissions Directive (IED), saying that it is vital the UK continues to be involved in revising and drawing up best available technique reference documents (BREFs) while it remains in the EU, until it is certain which BREFs will be implemented in the UK and what the future relationship with the EU will be.

“Complying with the IED can require significant investments and the appropriateness of BREFs is largely dependent on strong industry involvement.

“Therefore, post-Brexit, if the UK is no longer fully involved in the Seville process, in our view new and revised BREFs should not be applied in the UK in the same way.”

The CIA also called for more clarity around the direction of energy and climate change policies post Brexit so that chemical business can plan their businesses.

It asked the government to develop an alternative to the EU emissions trading system (ETS) that supports the ability of UK chemical businesses to compete on a global scale.

“With Brexit potentially adding to the costs of chemical business, it is important that the UK takes the opportunity to minimise energy-related policy costs for energy-intensive businesses.”

Continued access to highly skilled individuals is also of utmost importance to the chemicals industry, the report said, adding that it is vital for its future growth and competitiveness.

Reflecting on the lauch of the new report, the CIA’s chief executive Steve Elliott said: “With £50bn of exports, the chemicals sector is the UK’s largest manufacturing exporter.

“With 60% of these exports going to the EU and 75% of the UK’s chemical imports coming from the EU, the terms of the UK’s exit are critical for the future success of the sector.

“This new guide, which we hope will be of interest to government and other stakeholders, makes clear the outcomes needed from Brexit negotiations in order to secure the long term success of our industry.”