Beyond customs duties

Jan Bakker

by Jan David Bakker, assistant professor at Department of economics

In June 2016, the people of the United Kingdom voted to leave the European Union (EU), a deep economic union with few internal trade barriers. The economic integration of the European Union goes beyond the elimination of tariffs within its borders but also minimises non-tariff barriers (NTB) to trade, for example, through mutual recognition of standards (i.e. a steak of beef that Italy imports from France is not checked for public health certificates at the border while a steak imported from Algeria is).
Since January 2021, the trade relationship between the EU and the UK is governed by the Trade and Cooperation Agreement (TCA) which ensures that trade between the two areas remains tariff free. However, given the aim of the UK to increase its independence from the EU in terms of domestic regulation and trade policy, the TCA only contains very limited provision of regulatory alignment between the two blocs. This allows for future regulatory divergence between the UK and the EU and therefore has created a regulatory and customs border in the English Channel which has led to an increase in NTBs between the UK and the EU. These NTBs include new comprehensive customs checks, rules of origin requirements and sanitary, and phytosanitary (SPS) measures for trade in animals and plants.