The 585 page Draft 'Brexit' Withdrawal Agreement includes transitional rules for the treatment of goods, and a ‘backstop’ to ensure the requirement for no north-south hard-border in Ireland will be maintained.

Under the draft agreement:

  • UK will leave the EU on 29 March 2019.
  • A transitional period will apply until December 2020. This can be extended if more time is required to agree on replacement deals.
  • A guaranteed ‘backstop’ will apply in relation to Northern Ireland, if no new trade arrangements can be agreed by the end of 2020, to ensure that there will be no north-south hard border.
  • During the transitional period the UK will remain under the jurisdiction of the Court of Justice for the European Union (CJEU) and follow EU law.

Under the backstop, should it be required:

  • There will be a single EU-UK customs territory:
  • No customs duties will apply to transfers of goods between the UK and EU.
  • The UK will not charge lower customs duty rates than the EU on non-EU goods imported.
  • The UK will continue to be bound by EU State Aid rules.
  • As for Northern Ireland:
    • Northern Ireland will remain subject to EU rules for VAT on goods and excise on goods. They will not remain aligned to the EU for services.
    • Despite this, Northern Ireland will still be considered part of the UK for VAT and transfers of own goods from Great Britain (GB) to Northern Ireland will not trigger a VAT charge and sales from a GB business to Northern Irish business will have a UK Place of supply and be subject to UK VAT not zero-rating.
    • Northern Ireland will be part of the same customs territory as the UK, it will not be considered a separate territory.
    • Northern Irish businesses will be able to place products on the EU market without restriction and without any checks.
    • Goods transferred from GB to Northern Ireland will need to undergo some new checks:
    • There would be a need for some compliance checks with EU standards consistent with risk.
    • The EU and UK have agreed to carry out these checks in the least intrusive way possible.
    • For industrial goods risk based checks will by carried out by UK authorities 'in the market' or at traders' premises. 
    • As for agricultural products, already existing checks at ports and airports will need to continue but will be increased in scale.
    • Northern Ireland will have unrestricted market access to the UK in relation to its products. This will not change due to the backstop.
    • Any goods originating from Northern Ireland will still be considered UK goods.

Links

Place of supply: goods

International goods

External links

Full Draft Agreement on the withdrawal of the UK from the EU

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