Key messages of the CECE workshop on the EU-UK partnership after Brexit

On 7th December CECE organized a workshop on the EU-UK trade partnership to understand the implicationsfor the construction equipment industryafter 1st January 2021. 

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CECE Secretary General Riccardo Viaggi stressed that a deal is crucial for the construction equipment industry, a notoriously integrated industry across the Channel. Since the beginning of negotiations CECE has been calling for frictionless trade and as little regulatory divergence as possible. In these final and crucial days of negotiation CECE calls for a last-minute deal that could prevent the cliff edge. 

Deputy DG of Business Europe Luisa Santosargued that the business community need at least a minimum set of rules ensuring a level playing field, legal certainty, trade in supply chains and a platform to continue the dialogue to builda closer relationship in the future. To mitigate disruptions after 1stJanuary 2021 the EU needs to take now contingency measures in data flowing, financial services and transport. A one-stop shop should be introduced at European and member states’ level to assist companies, notably SMEs, in trade with UK after 1st January. As several unwanted errors are expected from SMEs, authorities should respond with pragmatic understanding and flexibility. 

Looking specifically at the construction equipment market, Chris Sleight, MD of Off Highway Research, made clear the close interdependance and the high trading volumes across the Channel. The EU/EFTA bloc, accounting for 41% of construction equipment sold in the UK, is the biggest supplier to the UK. Similarly, the EU/EFTA bloc is the most important destination for UK-made construction equipment, accounting for 38% of CE exports. Bearing this data in mind the biggest trade concern for companies after 1st January are the additional costs and longer lead times due to tariffs, notably in intermediate goods, the reintroduction of custom formalities and the potential regulatory and technical divergence. Leaving the EU and the CAP will have a negative impact on UK farmers’ income, which may result in declining sales of agricultural and construction equipment. With Brexit, the UK might also become a less attractive place to manufacture and several OEMs may move their production outside the UK. 

Dale Camsell Technical Consultant, CEA, presented the guidance document to place products on the GB market, produced by the UK government. From 1st January 2021 the UK will have its own regulatory framework and the UKCA mark. Initially the UK will implement its own version of the already implemented pieces of EU legislation that affects placing products on the UK market, such as the Machinery Directive and the Outdoor Noise Directive. The essential health and safety requirements will not change. Hence the relevance is on marking requirements and conformity assessment. The UK government has allowed CE marked goods to continue being placed on the GB market until 31st December 2021, but only in certain cases. From 1st January 2021 a UK-based importer will need to be established in order to place products into the GB market. The importer must be located and registered in the UK. Similarly to CE marking, existing EU type approval can continue to be used until 31st December 2021 for items not normally requiring registration, such as trailers, engines for non-road mobile machinery and components. From 1st January 2021 the Northern Ireland protocol will come into force. Northern Ireland will effectively remain within the EU Single Market. Goods placed on the Northern Ireland market must continue to comply with EU legislation.