Chequers White Paper Briefing No 2: Does the Facilitated Customs Arrangement comply with WTO law?

David Collins is Professor of International Economic Law at City Law School, University of London

Tw: @davidcollinslaw

Introduction

The UK government’s Chequers White Paper “The Future Relationship Between the United Kingdom and the European Union” relies heavily on a Facilitated Customs Arrangement (FCA) in which the UK will charge importers a common external EU tariff at its borders, exempting those goods which are demonstrably destined to be consumed in the UK. For goods with an indeterminate destination, the higher of the UK or EU tariff will be charged, with a rebate paid to the exporter if the good ends up in the lower tariff jurisdiction, whether that is the UK or the EU. This proposal has already encountered resistance from the EU’s chief negotiator Michel Barnier, who hs said that “The EU cannot and will not delegate the application of its customs policy and rules, VAT and duty collection to a non-member who would not be subject to the EU governance structures.

But in addition to this problem and the practical difficulties associated with this complicated system, notably tracking products with multiple components to their ultimate destination, there are at least two reasons why this may be illegal under the rules of the World Trade Organization (WTO) of which both the EU, and the UK (after Brexit) are members. Continue reading “Chequers White Paper Briefing No 2: Does the Facilitated Customs Arrangement comply with WTO law?”

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