The UK is due to leave the European Union at the end of this month. But there will then be a Transition Period until the end of December, during which EU law on the free movement of citizens will continue to apply.

Assuming that the UK and EU ratify the Withdrawal Agreement during January, the transition period will start on 1 February.  In theory, it could be extended beyond 31 December, but the UK government proposes to legislate to make this impossible.

The EU Commission published a handy Guide in November 2018, when the Withdrawal Agreement was first being finalised, and it is still  relevant for information purposes.  It covers:

• The Transition Period and its Scope in terms of who is covered
• The rights of family members: Residence rights
• Entry & exit rules; Criminality & abuse
• Administrative procedures; Professional qualifications
• Social Security; Useful links

The Transition Guide can be downloaded by clicking here.

Visit our Directory and Negotiation Update page for more detail.

The Society of Motor Manufacturers and Traders (SMMT) pleads for a free trade deal as it reveals that UK car production fell by 16.5% in November 2019. Anna Tobin reports

The latest figures from the SMMT show that UK car production was down 16.5% in November, with 107,753 units manufactured. A fall in consumer and business confidence, weak demand from overseas’ markets and model production changes all influenced the significant drop. While factory shutdowns around the time of the UK’s planned October exit from the EU to mitigate against any disruption arising from Brexit, were also a contributing factor.

The SMMT estimates that Brexit contingency measures taken by the car industry have now cost the sector more than £500 million.

“UK car production is export-led, so we look forward to working with the new Government to deliver an ambitious trade deal with the EU,” said SMMT chief executive Mike Hawes. “To ensure our competitiveness at a time of dramatic technological change, that deal needs to be tariff-free and avoid barriers to trade, which, for automotive, means that our standards must be aligned. This can be achieved if Government and industry work in partnership to re-establish the UK as a great place to invest and ensure that automotive keeps delivering for Britain.”

UK food and drink exports saw the largest growth in sales to China in the third quarter of 2019, finds the Food and Drink Federation (FDF) after analysing the latest HMRC trade statistics. Anna Tobin reports

The FDF’s latest analysis of HMRC trade data, shows that UK food and drink exports rose by 8.3% to £6.2 billion in the third quarter of 2019 and that this rise was driven by a 13.1% growth in sales to non-EU countries.

The most significant increase in food and drink exports outside of the EU was to China, where sales rose by £64.6 million, the largest value increase in over two decades. Approximately 17% of UK food and drink exports to China was branded product, with infant prepared food the fastest growing product.

Sales of branded goods to the EU fell -3.2% in quarter three, this is thought to be the result of the uncertainty surrounding Brexit. The FDF say this reinforces anecdotal evidence that key buyers are starting to look elsewhere due to current uncertainty in the UK.

“This is the fourth consecutive year of food and drink export growth in quarter three,” explained FDF president Gavin Darby. “While the overall value of UK exports across all industries has declined for the year-to-date, food and drink has shown great resilience to buck that trend, delivering growth of 6.3% on 2018 already. Although sales of branded goods to the EU have declined, encouragingly our sales to non-EU countries has increased by over 9% so far in 2019.”

The full FDF exports report can be read here.

Minette Batters, the National Farmers Union president, says the new Government must do everything in its power to avoid the UK having to operate on WTO terms following Brexit. Anna Tobin reports

Following the general election result, the National Farmers Union (NFU) president Minette Batters said: “In our own election manifesto, we raised a number of crucial issues we need the new Government to address now, to ensure British food production has a sustainable and ambitious future.

“Top of that list is Brexit. It’s imperative we secure a future trade deal with the EU that is as free and frictionless as possible, avoiding the damaging spectre of trading with our largest partner on WTO terms. Alongside this, our future trade policy mustn’t allow imports of food produced to standards that would be illegal to produce here.

“The UK could embark on its first trade negotiations for decades in just 50 days’ time – the Government must set up a Trade and Standards Commission as a matter of urgency so that they can work with industry and stakeholders to ensure those negotiations do not allow the high standards which are the hallmark of UK farming to be undermined by imported food which would fail to meet our own domestic regulations and values surrounding animal welfare, environmental standards and traceability.

“From our ambitious vision for agriculture to reach net zero greenhouse gas emissions by 2040 to increasing our self-sufficiency by producing more high-quality, British food at home, British farmers are ready and able to tackle the challenges ahead as well as making the most of new opportunities.

“We live in a country that has some of the highest animal welfare, environmental and food safety standards in the world, all the while providing the British public with the third most affordable food on the planet, and at the same time maintaining and enhancing the iconic British landscape. That’s why the public trusts and supports British farmers.

“Britain needs the new Government to back British farming like never before; to invest in domestic food production so we can increase our productivity, create more jobs and deliver more for the environment. Government needs to act to ensure guaranteed access to a skilled and competent workforce; develop a framework for a more competitive and sustainable farming industry; put in place a long-term food strategy; and place science at the heart of policy making. This will allow farming businesses to continue doing what they do best – provide safe, traceable and affordable food for the nation.”

The representative of the UK’s largest manufacturing exporter, the Chemical Industries Association (CIA) is calling for a frictionless, free trade agreement to protect the industry through Brexit and beyond. Anna Tobin reports

With his new political mandate in place, Steve Elliott, the chief executive of the CIA, is urging Prime Minister Boris Johnson to negotiate a frictionless free trade agreement with the EU. He said: “The Country now has the political clarity and certainty which business has been seeking. Now we have that we must get Brexit right and secure an exit and future trading relationship between the UK and the EU that enables broader manufacturing and the chemical industry to maintain and grow its contribution to the whole of the UK economy and to people’s everyday lives.

“We now look forward to working with the Prime Minister, his Government, all political parties across parliament and the devolved  administrations to ensure a strong UK manufacturing presence across the country. Our industry in this country and throughout Europe will be supporting both our Government and the European Union to ensure there is a friction-less, free trade agreement in place as soon as possible. We also believe that it is in our environmental and commercial best interests to secure close regulatory alignment with the European Union and to ensure that we can continue to attract and retain the very best skilled, specialist people from anywhere around the world.

“After three and half years of political stalemate, I hope we can now make rapid progress on our EU exit and future relationship and start to tackle some of the great challenges that are before us. As the Prime Minister said, delivering net zero emissions by 2050 is central to those challenges and it can only be achieved through the products and technologies of chemical businesses. Our industry supports this ambition and we look forward to working with the new Government to secure the investment in technology and infrastructure that will help us reach this.”

Business organisations have been quick to respond to the general election results. Anna Tobin investigates what they had to say

The  Confederation of British Industry 

Following the news of the general election results, Carolyn Fairbairn, the director general of the Confederation of British Industry (CBI), urged the Government to speedily give business clarity on Brexit, she said: “Congratulations to Boris Johnson and the Conservative Party. After three years of gridlock, the Prime Minister has a clear mandate to govern. Businesses across the UK urge him to use it to rebuild confidence in our economy and break the cycle of uncertainty.

“Employers share the Prime Minister’s optimism for the UK and are ready to play a leading role. They can bring the innovation, investment and jobs for a new era of inclusive growth. The biggest issues of our times – from tackling climate change to reskilling the workforce for new technologies – can only be delivered through real partnership between Government and business.

“The starting point must be rebuilding business confidence, and early reassurance on Brexit will be vital. Firms will continue to do all they can to prepare for Brexit, but will want to know they won’t face another no deal cliff-edge next year. Pro-enterprise policies on immigration, infrastructure, innovation and skills, will help relaunch the UK on the world stage.

“Despite recent challenges, the UK remains a great place to start and build a business. A new contract between enterprise and Government can make the UK a global magnet for investment, powering higher productivity and living standards across the UK.”

Federation of Small Businesses

Mike Cherry, the national chairman of the Federation of Small Businesses (FSB), has his fingers crossed that the majority Government formed following the general election will bring the stability that SMEs crave. He said: “After more than three years of Brexit absorbing Government bandwidth, the Conservative Party has pledged to tackle the many domestic challenges that have been neglected during that time.

“In the coming days we will see a Queen’s Speech and steps towards leaving the EU next month. Amid this, small businesses the length and breadth of the UK will be looking to the new Government to achieve positive change for small firms in its first 100 days, not least with publication of a pro-business Budget in early February.

“The restoration of small business confidence and trust in politics rests on seeing the Conservatives’ pledges to us swiftly enshrined in a programme for Government. It’s now time to turn kind words on bread and butter issues facing the small business community into tangible action.

“This Government needs to deliver a business-friendly Brexit. That means one that protects the three t’s: trade, talent and a proper transition. The third of those is absolutely critical. We have to avoid a scenario where we suddenly crash out of the EU with no time for small firms to prepare for what’s coming next.”

“Restoring business, investor and consumer confidence – and firing up the economy – must now be the Prime Minister’s top priority.

“Campaign slogans must give way to a renewed focus on the details that matter. Our business communities need to see swift, decisive action to avoid a messy and disorderly exit from the EU and to tackle the barriers holding back investment and growth here in the UK.”

British Chambers of Commerce

Avoiding a no-Deal Brexit and restoring business confidence are among the demands that Dr Adam Marshall, the director general of the British Chambers of Commerce (BCC),  is making of the new Government, following the general election. He said: “Restoring business, investor and consumer confidence – and firing up the economy – must now be the Prime Minister’s top priority.

“Campaign slogans must give way to a renewed focus on the details that matter. Our business communities need to see swift, decisive action to avoid a messy and disorderly exit from the EU and to tackle the barriers holding back investment and growth here in the UK.”