Considering the EU-New Zealand Veterinary Agreement and the future of trade between the UK and the EU
Despite much focus being quite rightly on coronavirus at the minute, we are conscious that the UK-EU negotiations are ongoing. Some are looking at the EU-New Zealand Veterinary Agreement as a possible template model for maintaining ease of access for food to and from the EU post-Transition Period so we wanted to explore how a similar agreement would work in relation to trade between the UK and EU in both directions.
We found that if there must be certification and checks on meat traded between the UK and EU at the end of the Transition Period, the reduced level of veterinary import checks and simplified export health certificates we see under the EU-NZ Veterinary Agreement would definitely be welcomed as an alternative to the default situation of a third country. However, we hope the UK and EU will be even more ambitious than what is contained in the EU-NZ agreement. Even with 1% physical checks on meat, the fact that any given consignment might get stopped for a check is hugely disruptive to supply chains for both UK to EU and EU to UK movements, and detrimental to shelf life, particularly of a product like chilled poultrymeat.
The EU and New Zealand developed the agreement with their own trade patterns in mind (and with the scope to go further in the future), so for instance poultry meat export from the EU to NZ is not covered at all by the agreement. Even where full equivalence exists under the agreement there can be special conditions attached where there are animal health or public health status differences. Key to making any similar agreement work between the UK and EU will be consulting industry and stakeholders to ensure the complex, just in time nature of UK-EU supply chains are covered, for instance composite products and the substantial trade in chilled meat across the species. The geographical realities of the Single Market are quite different to those between the EU and New Zealand.
Detail on how equivalence between the UK and EU will work, either under a veterinary agreement or not, should be made available well in advance so the industry can adapt to the new situation and plan what level of resource it may have to invest. Required investment could include seeking veterinary officials for signing of export certification, in companies’ own staff to get ready for preparing additional paperwork or hiring a freight forwarder. Industry also needs time to consider how to deal with the increased costs of certification compared to the current situation on UK-EU trade.
Groupage is a process whereby transport companies can minimise costs by doing multiple pickups and drop offs of product owned by multiple companies at different points, this is commonly used by SMEs and is cost effective. A significant amount of intra-community trade takes place using groupage, with pallets owned by multiple companies loaded in one truck or van. While New Zealand imports arrive at ports or airports with Border Control Posts to be checked, there are no ‘borders’ as such between the UK and EU-27 presently and trade takes place via trucks, vans, ro-ro and road. A solution must be found to facilitate the continued possibility of groupage under any future UK-EU arrangements, for the benefit in particular of SMEs. We raised this issue in our Brexit Policy Paper in 2016 and have been raising it ever since.
The existing EU-NZ agreement has been of huge benefit to our members importing meat from New Zealand, in terms of both speed and simplification of processes but we would also encourage the UK and New Zealand to go further with enhancing veterinary equivalence under their own veterinary agreement, which was rolled over in the Brexit context, as there are opportunities here.