Brexit Update: EU won't pay customs duty when trading with the islands

Tuesday 27 November 2018

Despite ever-increasing tension around the Prime Minister's Brexit deal, Guernsey and the other Crown Dependencies are continuing to take steps to ensure we have as smooth a transition period as possible.

Deputy Mary Lowe, Home Affairs President, has joined representatives from the States of Jersey and the Isle of Man in the UK to sign a new customs arrangement deal with HM Treasury.

Those arrangements, in the words of Central Devon MP and Treasury Financial Secretary Mel Stride, mean that when the UK leaves the EU, continental traders will continue to pay no customs duty moving goods to and from the islands. The move is one of several taken so far to preserve a similar relationship with the EU that we already have. 

In real terms for us, it means no new checks at the border of the island, no new tariffs, and generally no disruption to current trade.

This agreement means Guernsey (and the Crown Dependencies) will have their own independent customs rules, independent of HM Revenue and Customs agreement in the UK.

Deputy Lowe said the agreement had been being negotiated since May, and will now offer continuity and stability for businesses. Their goal in the negotiations was to respect the islands' "autonomy and fiscal independence".

"It has taken many months of negotiation between all parties to get to this agreed position and I am pleased to be able to sign this agreement which crucially, will offer continuity and stability for businesses within the Islands whilst respecting our autonomy and fiscal independence," she said.

"It is also an important step in securing the extension of the UK’s membership of the World Trade Organisation, and will position Guernsey to take part in the UK’s network of Free Trade Agreements it will seek when it has control of an Independent Trade Policy."

I was delighted to be able to sign the customs arrangement between Guernsey and the UK today, this joint commitment ensures there continues to be a safe and secure customs arrangement in place and a continued close collaboration between the UK and Guernsey as the UK leaves the EU https://t.co/m3eTx5og9L

— Deputy Mary Lowe (@DeputyMaryLowe) 26 November 2018

Minister Strude said: "These new agreements place our customs relationships on a firm footing for the future, and reflect the shared objective of the UK and Crown Dependency governments to ensure a continuation of our current customs relationships when the UK leaves the EU.”

Also yesterday, the States announced its most senior politician, Deputy Gavin St Pier, has been discussing the conclusion of the withdrawal agreement with Robin Walker MP. Minister Walker is the Parliamentary Under Secretary of State for Exiting the EU, and in the last two years has taken a keen interest in what will happen with dependencies like Guernsey.

Deputy St Pier said Minister Walker reiterated that the UK Government's exit deal was negotiated with us in mind.

Pictured: Robin Walker MP, Under Secretary of State for exiting the EU.

Now, the States of Guernsey are again emphasising that they have been clearly told by Parliament that the UK is negotiating on behalf of all territories it is responsible for. Minister Walker underlined that the UK Government will be seeking specific arrangements for the Crown Dependencies that take account of their special relationship with the UK. 

Much like Deputy Lowe, Deputy St Pier said these arrangements would "respect our shared constitutional relationship and the Crown Dependencies’ fiscal autonomy".

"I was pleased to note that another milestone has been achieved with the European Council having agreed the Withdrawal Agreement as well as setting out a framework for the future relationship. If agreed by the UK and EU Parliaments, these will apply to Guernsey and create a transition period which will maintain the trading relationships that we currently have under Protocol 3 during that time," he said.

"This will give a period of stability for business and the community alike, whilst the new relationship with Europe is negotiated. As I said in my recent correspondence to the Prime Minister, it is clear that an orderly exit from the EU for the UK is in Guernsey’s best interests.

"I was reassured to hear from Robin Walker that it is the UK’s clear intention for these future relationship negotiations to seek a deal for whole of the British Family, including one for the Crown Dependencies that is proportionate to our economic relationship with the EU and respects our autonomy and constitutional relationship with the UK.  As the exit process enters the next phase we agreed to continue to work closely over the coming weeks and months to secure these objectives.”

Pictured top: close left, Deputy Mary Lowe, far left, Jersey Senator Ian Gorst.