Britain should unilaterally recognise other countries’ regulations in order to make the most of post-Brexit trade, according to a new report backed by Jacob Rees-Mogg.
The newly-appointed minister for Brexit Opportunities has thrown his weight behind calls to automatically accept foreign rules, so long as they offer equivalent safety standards.
Not demanding that other nations accept UK rules in return would dramatically free up trade and be in the interest of British consumers, according to analysis by the Institute for Economic Affairs.
The think tank argues that the cost of non-tariff barriers, such as complying with safety regulations and customs marks, can cost the equivalent of up to 20 per cent tariffs on some goods.
Under current plans, from 2023 all EU goods destined for the UK market will need to be certified with a new regulatory customs mark, recognising regulatory independence of the UK from the EU.
This is because the EU refuses to continue mutual recognition after a transitional period.
However, the IEA says Britain must nevertheless unilaterally recognise EU rules and the CE mark in the interest of a “new radical free trade policy”.
Mr Rees-Mogg, who accepted his new post in Mr Johnson’s “mini” reshuffle this week, said: “Anyone who believes in free trade will welcome this report.
“Non-tariff barriers are the delight of protectionists and should be removed wherever possible.”
Victoria Hewson, the IEA report author, said the removal of so-called non-tariff barriers are just as economically important as tariffs themselves.
“The UK has an opportunity to lead the world with a radical trade policy of recognising regulations, without requiring reciprocity, starting with the EU.
“This will transform the UK’s trade policy, ensuring goods which emulate our own standards are traded freely into the UK without unnecessary regulatory barriers.
“This will bolster the UK’s status as a free trading nation and help towards a solution to the Northern Ireland Protocol dispute”.
The report states arguments against unilateral recognition “include the risks of compromising the autonomy of UK regulators and sacrificing leverage that could be used to the benefit of British exporters, but… the gains from unilateral recognition would outweigh these potential disadvantages.”
The report comes amid continuing disagreement between the UK and the EU over the Northern Ireland protocol.
UK government sources this month bemoaned the bloc’s unwillingness to consider new ideas to end the deadlock, accusing the EU of dragging the talks in “trench warfare”.
The EU Commission had hoped that the departure of Lord Frost before Christmas as the lead Brexit negotiator and replacement by Liz Truss would lessen the chances Britain would trigger Article 16, which would allow the UK to take unilateral action to safeguard trade if it judged the protocol to lead to “serious economic, societal or environmental difficulties”.
