News | Published January 27 2020

Outcome of UK-EU free-trade negotiations vital for wholesalers like Norscot Seafoods

When it comes to sectors that will be affected by Brexit, among the most relevant is the fish wholesale industry, where the impact of new regulations after the UK’s departure is causing various concerns. With a UK-EU free-trade agreement set to be negotiated later this year, the outcome of these talks will be vital if industry operators are to continue trading with the continent without hindrance.

Norscot Seafoods, a wholesale fish merchant based in Kinlochbervie, Scotland, is one such operator that could be affected.

Speaking to The Parliamentary Review about his own concerns, managing director Donald Morrison said: “On a sector-wide basis, many businesses have been impacted by the uncertainty surrounding the UK’s departure from the EU. 

“No-one is able to properly predict how things will change and many of us fear the effects of new regulations that could follow a no-deal scenario. For us, as an exporter to Europe, our produce could be held up at customs and also subject to more paperwork. This would make a large part of our trade more difficult and the ongoing lack of clarity means we aren’t able to plan.”

Even though prime minister Boris Johnson has negotiated a new Withdrawal Agreement with Brussels which at the time of writing is set to be enshrined in law, the risk of a no-deal scenario, which Morrison speaks of, is still very much a lingering possibility in trade terms.

Once the UK leaves the EU on January 31, both parties will open talks concerning their future relationship, including on issues such as trade. They will have until the end of the Brexit transition period, namely December 31, to make the necessary arrangements.

Should a free-trade deal not materialise in that time, the UK would default to World Trade Organisation terms in trading with Europe, which is very much akin to a no-deal scenario that would come with a disorderly Brexit.

For merchants like Norscot Seafoods who trade with the continent, a free-trade agreement being struck by the end of the year is critical in avoiding cumbersome customs barriers and border disruption to trade flow.

Whether or not a deal can be struck in 11 months is uncertain, with different sides offering different views. The British view from prime minister Boris Johnson and his cabinet is that it can be done.

On the other hand, newly elected European Commission president Ursula von der Leyen feels that such a comprehensive free trade deal will be “impossible” to finalise by the end of 2020, and favours an extension.

However, the prime minister has repeatedly insisted that this is something he is unwilling to do, leaving free-trade negotiations facing a possible cliff-edge at the end of the year.

This may force a need for the UK and EU to prioritise certain issues during the talks, after von der Leyen hinted that being able to “agree every single aspect” of the new partnership is unlikely within the given window.

She has also suggested that the new partnership will depend heavily on how far the UK wishes to diverge from EU rules. Speaking to the Financial Times in a recent interview, chancellor Sajid Javid has indicated that there will be such divergence concerning some EU rules after Brexit, but stopped short on going into details. In the meantime, uncertainty will only weigh heavier. Further comments on this revelation from Tim Rycroft, chief operating officer of the Food and Drink Federation, will have provided little reassurance, after he called it a “death knell” for frictionless trade with the EU.

However, von der Leyen has previously indicated that she would like the future relationship to be based on “zero tariffs, zero quotas, zero dumping”, which is a positive indicator of how the EU will approach negotiations for those in industry left in the lurch.

So, despite a Withdrawal Agreement being in place and Brexit itself confirmed, uncertainty still lingers about the form it will take going into 2021.

Yet, the industry is staying positive, at least in Norscot Seafoods’ case.

Morrison said: “There is little certainty, but our experience of nearly 50 years helps us find a way through.

“We are as prepared as we can be for a worst-case scenario and at this stage can only continue doing what we do best.”

One would hope that despite there being uncertainty in the interim, that once the dust clears the industry is met with as little disruption as possible and the outcome of UK-EU trade talks yields a positive outcome for all affected.

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Authored by

Scott Challinor
Business Editor
January 27 2020

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