The government today unveiled its plans for a trade bill setting out how the UK will implement existing EU trade agreements after Brexit and avoiding a cliff edge for businesses.
The bill will aim to allow the UK to enter into trade agreements with the 40 countries with which the EU already has agreements, to try to ensure there is no overnight change in trade requirements once the UK officially leaves the bloc.
The bill will be important because the UK is currently unable to strike trade deals with other nations, owing to its membership with the EU.
Guy Lougher, partner and head of the Brexit advisory unit at law firm Pinsent Masons, said: “Practically speaking, the UK faces a significant uphill challenge in ensuring an orderly transition from the deals that the EU has struck onto signing its own trade agreements.”
There is an “extraordinary amount of commercial value at stake” over the bill’s details, said Sarah Owen-Vandersluis, head of trade strategy at KPMG.
International trade secretary Liam Fox sponsored the bill, which was given its first reading in the House of Commons today. No date has yet been announced for a second reading, when MPs will first debate its contents.
The bill, which is likely to receive heavy scrutiny from opposition parties, will also establish a new independent UK body, the Trade Remedies Authority, to settle disputes over unfair trade practices.
Tariff schedules will be set out separately as part of the Treasury’s customs bill, which the Department for International Trade said will be laid before Parliament “shortly”.
Fox said the bill will allow the UK to “shape our own trade and investment agenda” for the first time in 40 years. As a member of the EU, the UK has hitherto been unable to pursue bilateral trade deals, which were a crucial part of the campaign for Brexit.
Fox added the bill will open up “access to new and exciting markets across the world”.
Mike Cherry, national chairman of the Federation of Small Businesses, said: "What's critical now is that businesses are given a firm commitment to a transition period post-Brexit.
“This interim arrangement must allow businesses that trade with the EU, to operate broadly in the same way as currently is the case, and maintain current terms of access to the EU customs union and single market during a time-limited period.”
Representatives from trade unions and charities expressed their anger that the bill was published just hours after a deadline passed for public feedback on its plan.
Nick Dearden, director of development charity Global Justice Now, said Fox had shown “utter contempt” for respondents to the consultation.
War on Want senior trade campaigner Mark Dearn said: “It’s clear from the decision to launch the trade bill within hours of the government’s consultation closing that it has utter disdain for public opinion.”
The Manufacturing Trade Remedies Alliance, which is made up of trade associations and trade unions, said officials will have no time to analyse reaction to the Trade White Paper or brief their Ministers on industry’s concerns.
Dr Laura Cohen, Chair of the Alliance said: “Today’s announcement that Ministers are pressing ahead with the Trade Bill, clearly without considering our further evidence, is bad news for UK manufacturing.”