Wed | Sep 19, 2018

UK outlines plans to ease pain of a no-deal Brexit

Published:Friday | August 24, 2018 | 12:00 AM
UK's Secretary of State for Exiting the European Union, Dominic Raab.

Businesses could face red tape at the border, patients could face delays to medical treatment and customers could see higher credit card fees if Britain leaves the European Union next year without a deal, the United Kingdom government acknowledged Thursday in documents outlining its plans for a 'no-deal' Brexit.

But Prime Minister Theresa May's Conservative government vowed it would limit the instability that could be triggered by a disorderly Brexit.

Even if Britain crashes out of the bloc next year without a trade deal, its plans include unilaterally accepting some EU rules and giving EU financial services firms continued access to the UK market.

Brexit Secretary Dominic Raab said the UK was determined to "manage the risks and embrace the opportunities" of Brexit.

"We have made clear that if negotiations don't achieve the optimum outcome, we will continue to be a responsible European neighbour and partner," he said in a speech Thursday to business leaders in London.

With seven months until Britain leaves the EU on March 29, negotiations on divorce terms and future trade have bogged down amid infighting within May's divided government about how close an economic relationship to seek with the EU.

The government insists it's confident of getting a deal before Brexit day, but is preparing for all outcomes. On Thursday, it published the first 25 of more than 70 papers covering 'no-deal' planning for sectors including financial services, medicines and nuclear materials. The rest are to be released by the end of September.

The documents urge people and businesses not to be alarmed by the 'no-deal' planning, and say the government will work to "minimise any disruption to the economy".

The papers say Britain will allow EU financial services firms continued "passporting" rights to operate in the UK for up to three years, even if no agreement is reached with the EU - although it can't guarantee that the bloc will let UK companies operate there. That could leave British retirees living in EU countries unable to receive their pensions.

Britain will need new regulatory bodies to carry out functions currently done by the EU, and British businesses that now trade freely with the bloc will face new paperwork if there is no deal.

For goods going to and coming in from the EU, "an import declaration will be required, customs checks may be arrived out and any customs duties must be paid," one document says.

And one of the thorniest questions how to maintain an open border, free of customs posts, between EU member Ireland and the UK's Northern Ireland - remains unanswered.

"We will provide more information in due course," is all the documents say.

The government said the UK will recognise EU standards for batch-tested medicines, so drugs from the bloc won't need to be retested in the UK But new drugs and treatments would still need approval from the UK medicines regulator before they could be sold in Britain.

The papers reveal that British organic farmers won't be able to export their produce to the EU unless the bloc certifies UK standards - a process that can't start until after Brexit and takes nine months. And the widely recognised organic logo plastered across everything from vegetables to beef belongs to the EU, so UK producers will no longer be able to use it.

Cigarette packaging also will have to be redesigned, because the EU holds the copyright on the photos of diseased lungs and other off-putting images emblazoned on the packs.

Millions of Britons could find online shopping more expensive after Brexit, the government acknowledged. The documents note that in the event of no deal, "the cost of card payments between the UK and the EU will likely increase" and the EU-imposed ban on firms charging extra for credit card payments will no longer apply.