Boris Johnson told of industry’s ‘substantial and growing concerns’ on post-Brexit trade
In a letter to the UK Prime Minister Boris Johnson, BCF CEO Tom Bowtell cited lack of progress on UK-EU Free Trade Agreement talks, as well as how current plans for future regulation of chemicals in the UK – particularly a UK version of REACH – would create substantial extra financial and regulatory burdens for business. These conditions could lead to global companies moving their manufacturing to sites in Europe threatening the UK’s status as a net-exporter. The letter also highlighted fears of job losses across the UK if workable solutions for trade beyond the Brexit transition period were not found.
According the the BFC, examples of extra regulatory burdens on the coatings and printing inks industry included UK-based companies that want to continue to export to the EU having to set up legal entities in the EU and operate under dual labelling regimes. On top of those issues of red-tape are the much-talked-about concerns over the setting up of a separate UK REACH system, duplicating the requirements of the existing EU REACH.
Additional costs to chemical manufacturers
In the letter to the PM, BCF explained how additional costs to chemical manufacturers re-registering chemicals in the new UK chemicals database within a two-year period are conservatively estimated at £ 1 billion (EUR 1.095 billion). Moreover, EU companies may deem it uneconomic to register some substances in the new UK system at all. That would mean UK manufacturers would not have access to the same raw materials as their EU counterparts or, in order to make sure they can continue to have access, UK downstream manufacturers, like those in the coatings sector, would have to take on the re-registration costs themselves.
The letter goes on to urge the Prime Minister to secure a comprehensive FTA that maintains tariff-free trade, high standards and consistency in chemicals regulation, and does not create substantial extra cost and bureaucracy or animal testing. It also calls for the current duplications inherent in the planned UK REACH system to be rethought, to reduce the additional costs that it would currently mean for business.
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