Agribusiness News April 2023 – Sector Focus: Northern Ireland Protocol Update

What is the latest on the NI Protocol?

In late February Westminster announced the Windsor Framework, a new proposal to resolve ongoing post-Brexit trade issues around the Northern Ireland Protocol. This new version proposes a two-lane system for imports to Northern Ireland – a green lane for NI-destined products from the UK with few checks, and a red lane for EU-destined products with full customs checks.

This announcement has been welcomed by both the EU and most politicians and businesses in NI, in offering the best solution so far to ensure ongoing freedom of trade. However, while the DUP agree that the Framework addresses trade issues in principle, it argues that practicalities are still vague, and it doesn’t address the continued issue of ‘EU sovereignty’ in NI (in relation to having to adhere to EU law on EU-designed products within the country’s borders. As such, the DUP continue to block the deal by refusing to join in the power sharing agreement required for Stormont to sit under the Good Friday Agreement, blockading parliamentary sittings, and creating frustration in NI as administrative concerns build up.

An early version of the Protocol was rejected due to the suggestion of border customs checkpoints, which were expected to essentially create a hard border and targets for violence. A following version suggesting an Irish Sea border has received equal concerns about hugely increased costs and lack of food availability in NI, with the proposal essentially cutting NI off administratively (in terms of trade) from the rest of the UK.

What does this mean for trade and businesses, in NI & beyond?

Previously, NI businesses – many of which are smaller and less able to order on scale or absorb costs – have faced large fees for shipments, particularly those for products where vet or plant health inspections have been required.

The expected changes for agriculture-related products under the Windsor Framework include:

Agri-foods

• Previously NI was subject to third country checks and controls – spot checking of a large proportion of shipments for physical checks, plus vet/official signed certificates for each type of product per shipment with each certificate costing £150;
• Beyond the extension provided by the EU, there would have been a ban on import of chilled meats e.g. sausages, mince, lamb joints etc;
• A temporary extension has allowed this to continue, but needed to be resolved or face a future where imports must meet full EU standards;
• Individual (and expensive) certificates are no longer needed, as well as a vastly reduced need for physical checks of green lane imports;
• Continued chilled meat products to be allowed, and to UK health, marketing and production standards, same as GB;
• Continued access to the RoI through NI, with relevant EU checks on red lane shipments, and no hard border, just checks at port.

Plants, seeds & agricultural machinery

• The ban on seed potatoes will be lifted, meaning British seed stock can move to NI again;
• The ban on ‘high risk’ trees and shrubs will be lifted to allow for greater planting in the next season;
• No certification requirements – Removal of burdensome paperwork for plants and other phytosanitary certificate checks;
• Switch away from plant passports to plant labels.

What’s next?

The recent vote in favour in the Commons is positive news for Sunak, and the EU will have to make legislative changes to implement the agreement which may take some time, but it is expected that the Framework will come into force in Autumn 2023.

In preparation, businesses will register as a trusted trader with HMRC to allow for pre-approval for export and smooth the logistical and administrative process. This will mean no routine checks or controls on goods at ports for shipments through the green lane.

The deal would be a huge relief to the agri-food sector, in NI and beyond. NI exports to Ireland account for 17% of all UK exports to Ireland – led by dairy produce, eggs and animal feeds; dairy exports account for 41% of all UK exports to Ireland. In addition, 64.1% of NI agri-food exports come to Great Britain, driven by beef and sheep trade. Movement for processing has historically been crucial, with NI processing milk and livestock in the Republic (due to lack of capacity), and the Republic packing potatoes in the North.

The Framework may not solve challenges of continued customs compatibility and checks across the UK-EU border, but will begin to smooth the processes for NI businesses to adapt and reduce the cost and administrative burden of operation.

anna.sellars@sac.co.uk