With Brexit negotiations back underway, techUK has published a new report on what tech exporters, particularly those in the Dual-Use, cyber and defence sector want to see when the UK leaves the EU.
This paper, titled ‘What Tech Exporters Want From Brexit’, outlines the steps the UK should take to ensure current trade is not disrupted, highlights the impact of uncertainty, how companies have already responded and complements an existing techUK paper ‘Leaving the Customs Union’ which focuses specifically on the importance of securing a customs system in time for the day the UK leaves the EU.
There has been positive progress on transition with a deal seemingly in place and the Articles on the continued flow of goods and conformity assessments are particularly welcome. But, there is still a lack of information on the future customs system and, with less than one year until exit day, this is a major concern.
Members believe Brexit will disrupt trade and one of the main conclusions is to ensure this doesn’t happen. There are several case studies in the report, where businesses have had to move operations into the EU and we urge Government to be more open with business, so companies can have more confidence about the future relationship.
From discussions it was also clear there are also opportunities from Brexit, especially in reforming the treatment of Dual-Use items and simplifying the overly complicated export licencing system for controlled items. The UK excels at innovative cyber, defence and Dual-Use products and techUK members in this area feel that that the UK regime is overly burdensome and inhibits export growth, something we can’t afford to do.
The report further encourages Government to look at how other non-EU countries approach Dual-Use goods and highlights the need for a long-term vision for this sector, especially if the EU Dual-Use Regulation recast fails to pass in the next year.
The report also makes suggestions around new and tech-led ‘Virtual Free Trade Zones’ that simplify customs clearances and help alleviate border crossing pressure. The recommendations in full are:
- Ensure there are no new barriers in the movement of goods between the UK and the EU, nor an increase in base prices for products. This is key to maintaining UK competitiveness in the tech and digital sectors.
- Transitional deal terms should be outlined by early 2018 and be results-driven and business ready. techUK believes this should have been at least two years and should follow a project management system with key milestones.
- Reform export controls. The UK has taken the lead from Europe on a variety of export control policies and Brexit is an opportunity to reform, future-proof and simplify onerous export control regulations.
- Consider other Dual-Use arrangements. The Dual-Use Regulation will not pass in time to be accounted for under the processes in the EU Withdrawal Bill, and the UK should set out a long-term strategy for promoting the exports of Dual-Use goods.
- Consider Virtual Free Trade Zones. Using tech, Virtual Free Trade Zones can allow for smooth processing of goods and allow for frictionless trade.
- Reform the customs system. Whilst the CHIEF – CDS transition is happening already, there is an opportunity to properly revise the whole suite of customs procedures.
- Flexibility in the next stage of negotiations. Businesses need to know where the UK and EU will be flexible and to what extent to better justify investment decisions.