Crunch time for Theresa May. She is being told to drop her hybrid ‘customs partnership’ by a majority of her Brexit sub-committee – DD, Boris, Gove, Fox, Williamson and Saj – as well as the European Research Group of Brexiter MPs led by Jacob Rees-Mogg. These are the eight reasons Leavers want May to ditch Olly Robbins’ customs partnership…
It would see the UK collect tariffs on behalf of Brussels. Importers would then have to prove their products weren’t leaving the UK in order to claim the tariff back. It would be extremely complicated and ultimately unworkable.
It won’t be accepted by the EU. It would require them to change customs processes across Europe, which they will never agree to. Indeed they have already rejected it.
Having to pay EU tariffs up front, and having to meet the administrative burden of proving their products are UK not EU-bound, would clearly make the UK a less attractive trade partner to non-EU countries and businesses.
It wouldn’t eliminate friction. There would still need to be checks at the border, as rules of origin will still need to be monitored.
It would inevitably lead to regulatory alignment – essentially staying in the single market for goods – keeping EU rules without any say. This would harm our ability to negotiate trade deals with non-EU countries. It would be a worst of all worlds outcome.
It weakens our hand for the rest of the negotiation. It suggests the UK hasn’t made its mind up on whether we really want to leave the customs union, incentivising Brussels to offer us a nightmare binary choice of a customs union or no deal.
Number 10 privately believes the customs partnership will not be able to be implemented until 2022, well beyond the end of the transition period.
If May persists with her customs partnership plan, it ramps up the chances of no deal. It risks betraying the result of the referendum and forcing Brexiters to put their letters in and blow up the negotiation.
The customs partnership is a customs union in all but name. It won’t be acceptable to Brexiters. May hasn’t publicly committed to the customs partnership – it is not too late for her to reject it, having consulted with Cabinet colleagues, and choose the Max Fac technology-based option. Big day ahead, putting off this decision further is only going to harm the negotiation…