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On the Right Side of the Law – The EU or the UK?

The UK proposals to change parts of the Northern Ireland Protocol if negotiation fails to end the Irish Sea Border friction is consistent with international trade law, says David Collins. If the EU rejects them, it could find itself on the wrong side of the law.

Not only are the UK’s proposals for reducing ongoing frictions on shipments crossing from Great Britain (GB) to Northern Ireland (NI) compliant with international law (specifically the Safeguard provision of the NI Protocol), the EU is arguably in breach of its international obligations by rejecting them.

The EU and the UK are both signatories to the 2014 World Trade Organization (WTO) Agreement on Trade Facilitation (TFA). Adherence to the TFA (by both the EU and the UK) is further mandated by Article 101.4 of the UK-EU Trade and Cooperation Agreement. Article 10.1 of the TFA requires all signatories to ensure that “the least trade restrictive measures [are] chosen where two or more alternative measures are reasonably available for fulfilling the policy objective or objectives in question.” The goal of the TFA is clear – customs checks should be as minimal as possible given the health / safety issues that are raised by non-conforming goods entering another country’s market.

Furthermore, under Article 4.2 of the TFA, signatories are required to “design and apply risk management [for customs control] in a manner as to avoid arbitrary or unjustifiable discrimination, or a disguised restriction on international trade.” A disguised restriction on international trade is a restriction that does not serve a legitimate policy aim, such as health or safety, but has the odious purpose of impeding the movement of goods across borders. Since the implementation of the NI Protocol, trade between GB and NI has dropped by 20 per cent as disproportionate customs formalities on the Irish Sea border have acted as a significant impediment to the trade within the UK’s internal market.

Article 4 of the TFA goes on to state that signatories “shall concentrate customs control … on high-risk consignments and expedite the release of low-risk consignments.” This risk management must be based on “appropriate selectivity criteria.” Ostensibly conforming with this rule, Article 5 of the NI Protocol speaks of customs checks on goods crossing the Irish Sea only if they are “at risk” of subsequently being moved into the EU. But in practice the EU has chosen to interpret this risk far too expansively. With as much as 20 per cent of all of the EU’s documentary customs checks taking place on the Irish border (for far less than one percent of its total trade), it is difficult to see how the EU can be said to be fulfilling this obligation. This is more than an embodiment of the risk-averse Precautionary Principle – it is a paradigmatic example of using red tape to tie up commerce.

In contrast to the EU’s heavy-handed approach to the NI border, the UK’s proposed changes to GB/NI customs arrangements are in keeping with the UK’s obligations under the TFA. In particular, the UK has proposed an arrangement which involves the introduction of two channels for goods movements: a green lane for trusted traders transporting goods to NI only – such goods will be exempt from checks and customs controls; and a red lane for products destined for the EU’s single market – these goods will have to undergo full checks and customs controls as required by EU law. The proposed legislation also sets out a new dual regulatory regime with businesses able to choose between meeting UK or EU standards.

Given that these measures are far less trade restrictive than those insisted upon by the EU under current Protocol, there is a strong argument that the EU is bound by international law to adopt them. Indeed, by refusing to accept the UK’s sensible, risk-based approach to customs checks for goods passing from GB to NI, the EU is abandoning its obligations as a party to the TFA. If the EU is the great proponent of international law which it claims to be, it should honour the TFA and accept the UK’s common-sense proposal on restoring trade with NI.

Professor David Collins

David Collins is Professor of International Economic Law at City, University of London and a member of Politeia's Academic Advisory Council. A WTO specialist, he previously practised commercial litigation in Toronto and was a prosecutor for the Attorney General in Ontario, Canada. His publications include The Public International Law of Trade in Legal Services (Cambridge, 2019), An Introduction to International Investment Law (Cambridge, 2016). Twitter: @davidcollinslaw.

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