As such, there is no WTO baseline. Failure to agree an ongoing framework for the range of issues of mutual concern would mean that we would be looking at multiple a cliff edges. Dealing with them would require a number of emergency measures which could very easily be sabotaged by Member States looking to capitalise on the confusion. We would have no formal means of discourse with the EU and all of our enhanced rights would vanish.
This is the point that is being missed. Long ago when we were first writing what was to become Flexcit
, we confronted the range and complexity of the issues to be discussed and concluded that we would be hard pushed to complete talks inside two years. Something had to give. Our answer was to "park" trade, taking the Efta-EEA option off the shelf in order to continue our trading relationships, buying us time to deal with all the other issues that demand attention.
This was never about the Single Market - or even just trade. Eventually we saw the UK leaving the Single Market, but on our terms at a time of our choosing – not under the cosh of time-limited Article 50 negotiations. The key issue was and is not whether
we leave the Single Market, but when and how.
As we pursued these ideas more deeply, we eventually concluded that we should take the Single Market with us, and reform it as an intergovernmental institution based in Geneva, exploiting the process of globalisation which is already under way.
Needless to say, none of our concerns about the dangers of the WTO option percolate Conservative Home
and its fellow travellers. For Goodman, its "minuses" amount merely to "finicky details" and "potential problems". One of the most obvious, he writes, is whether our customs would have the capacity to cope with the new conditions. Then there is the mass of "finicky details" that have the potential to add up to significant problems.
Displaying world-class ignorance, Goodman goes on to say that one of those most often cited is aviation – flight numbers, landing slots, and so on. Another, he says, is the recognition of the licensing of medicines.
Separately, says Goodman, there is the question of how Britain and Ireland would handle customs, border control and citizenship. The controversy over how important passporting is to the City rolls on. But, he says, it is far from impossible to believe that, although the City won't collapse, some jobs will leak abroad (though less to Paris and Frankfurt than to New York). Some firms might take fright at tariffs, low though most of these will be, and seem to relocate. Potential investors could look elsewhere.
Bizarrely, in Goodman's single reference to customs, we see only doubts expressed as to whether our customs would have the capacity to cope with the new conditions. There is nothing of the newly acquired status of the UK as a "third country" and the treatment of UK goods by the officials of EU Member States.
Part of our concerns relate to the cessation of mutual recognition of UK conformity assessment. In the event of a collapse of negotiations and the UK walking away, as Goodman wants, the existing EU regulations which confer such recognition cease to apply to the UK as it would no longer be an EU Member State.
However, Goodman's complacency is embellished by a commenter
who asserts that there has been "a good deal of exaggeration of the risks". Conformity assessment problems, he says, "are overstated especially given the large amount of self-certification allowed and the abundant scope for a deal on mutual recognition". And therein lies exactly the problem. Indeed there is "abundant scope for a deal", but if the UK walks away, there can be no deal.
Similar mistakes are made by others, not least relating to the activities of "notified bodies" and the continued recognition of UK bodies after a sudden withdrawal by the UK.
The point I have made is that the validity of certification issued by notified bodies is verified by customs officials by reference to a continuously updated list in the Official Journal. But, once the UK drops out of the system and becomes a third country, the UK bodies will be removed from the Official Journal. And if they don't exist, certificates issued by them cannot be validated.
There is provision within the Commision Guidance
(p.87) for the suspension or withdrawal of a notification. Under normal circumstances, certificates issued by the notified body up to that point, remain in force, until their normal expiry date.
However, this is conditional on the notifying Member State ensure that the files of that body are either processed by another notified body or kept available for the responsible notifying and market surveillance authorities at their request. But since the UK – which would perform this function – would no longer be a Member State, it is hard to see how the conditions could be satisfied.
Despite this, some think it is highly unlikely that existing certificates will suddenly lose their validity after Brexit, while others believe that UK exporters would have plenty of notice and could get new certificates in time to continue trading.
This, though rather misses the point that, if the WTO rules are the "walk-away" option, there is no advance notice - and no negotiation with the EU over mitigating measures. We face a "sudden death" scenario. In due course, as I point out in Monograph 2
, emergency measure could be arranged, but it might be several weeks, if not months, before order could be restored to the resultant chaos.
Crucially, as the EU's own Blue guide
points out, imports from third countries are treated very differently from those produced by an EU member state. While the latter are subject to internal checks by national market surveillance authorities, with third country imports, points of entry to the EU's external borders become the relevant places to stop non-compliant and unsafe products coming in.
Thus, customs authorities are told to "carry out initial checks, at the first point of entry, on the safety and compliance of the imported products". In accordance with specific guidelines
, which rely on Council Regulation (EEC) No 339/93
, those checks must be on "an adequate scale" and must include "documentary, physical or laboratory checks".
Thus, from a zero inspection regime, UK goods would become subject to mandatory checks, their scale based on risk assessment
. This will be conditioned by this guidance
. UK imports will effectively be treated as "new trade flows", where data are limited after the termination of customs cooperation arrangements. According to Community guidance on risk analysis
, the imports will have to be regarded as high risk and subject to the highest intensity of checks.