Trade in Goods and Level Playing Field
Brexit Institute Working Paper Series, No 7/2021
Forthcoming in Federico Fabbrini (ed.) The Law & Politics of Brexit. Volume 3: The Framework of New EU-UK Relationships (Oxford University Press, 2021)
17 Pages Posted: 30 Mar 2021
Date Written: March 3, 2021
The Trade in goods chapter of the TCA is meant to facilitate trade between the two parties by preventing the reestablishment of custom duties and quantitative restrictions. The new trade regime between EU and UK resembles to those typically established by other Free Trade Agreements, except that the TCA does not exclude cumbersome border controls, as operators have discovered at their costs immediately after 1st January 2021. These controls are necessitated by the absence of commitments by the UK to stick for the future to the EU regulation.
The recovered ´freedom to regulate` by the UK could lead to imbalance in market conditions stemming from diverging domestic regulation as to competition rules and subsidies, labour and environmental standards. To guarantee that the enterprises of the two parties enjoy in all respects equal terms of access to, and treatment in, each other’s markets an innovative mechanism has been devised. The Level Playing Field provisions provide for multi-step procedures, allowing protective countermeasures by the party affected, including even custom duties, labelled as “rebalancing” tools. A complex system designed to dissuade a party from lowering its standards or unfairly subsidizing its enterprise by putting the relative freedom of trade between the parties under the TCA at risk of further back-sliding.
Keywords: EU/UK trade in goods, rules of origin, level playing field, rebalancing and countermeasures, dispute settlement
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