Latest: British brexit proposals on customs must be close to status quo, Irish Chamber of Commerce

Latest: British brexit proposals on customs must be close to status quo, Irish Chamber of Commerce

Update 11am: Any temporary post-Brexit customs deal must be as close to the status quo as possible, leading business lobbyists have warned.

The British Irish Chamber of Commerce said it was cautious about the feasibility of some proposals being put forward in London on simplifying new trade barriers with Europe.

John McGrane, director of the association, said the ideas were a constructive contribution to the negotiations.

"The recognition of the need for an interim period to allow for the adoption of new systems and infrastructures will be welcomed by businesses who have long warned of the dangers of leaving the Customs Union without such a transition phase," he said.

"It is important that this phase is as close to the status quo as possible with minimum disruption caused by tariff and non-tariff barriers."

John McGrane
John McGrane

One plan being put forward by London is a time-limited transition which would ensure businesses trading in and out of the UK would only have to adapt once to the rule changes.

A two-year period is being suggested by Brexit Secretary David Davis and he is pushing for the UK to have the right to negotiate new trade deals with other countries.

On customs, one option being put forward would see the UK manage a new trade border with administration streamlined to what has been described as the "fullest extent possible".

Mr Davis will also float plans for a customs partnership with the EU which would negate the need for customs checks between the UK and the European bloc.

Mr McGrane said the idea of an alternative customs arrangement was interesting but completely unproven and that anything less than a completely open border is problematic for business and citizens.

The next Brexit negotiation round starts at the end of the month.

Mr McGrane said a comprehensive post-Brexit customs deal is vital for borderless trade on the island of Ireland and between the UK and the EU.

"The future customs relationship that is agreed between the UK and the EU will be hugely important for the future trade relationship on the island of Ireland," he said.

"An agreement must be sought that ensures borderless trade can continue on the island in order to protect the economic and social gains that have been won over the past 19 years with the development of the all-island economy."

Earlier:

Britain could keep the same customs arrangements with the European Union for an interim period in order to avoid "unnecessary disruption" for UK businesses, the UK Brexit Secretary has said.

David Davis will publish a paper later today outlining proposals for a time-limited transition, meaning businesses on both sides of the Channel only have to adapt once to rule changes.

Temporary arrangements could allow trade deals to be negotiated with other countries while governments and businesses adjust to new arrangements.

However, reports suggested this would have to be negotiated during Brexit talks, with members of the EU's customs union barred from striking their own trade deals outside the bloc.

Critics dubbed the proposals "a fantasy" and said they did little to provide the certainty businesses have called for.

Mr Davis, writing for the City AM newspaper, said the UK's new customs arrangements "will need to facilitate the freest and most frictionless possible trade in goods between Britain and the EU".

Latest: British brexit proposals on customs must be close to status quo, Irish Chamber of Commerce

He said the Brtish government would seek to negotiate an interim period with the EU in order to avoid "unnecessary disruption".

"That would be a strong indicator to all our businesses and citizens that politicians on both sides are serious about finding a constructive outcome that works for all involved. Doing so is our shared duty," he said.

"The united desire to avoid unnecessary disruption or a disorderly exit for the United Kingdom from the European Union is a strong foundation for the negotiations."

Ministers have been warned about the strain ports could be put under if they face a big increase in bureaucracy for dealing with goods entering and leaving the country.

The proposals for new customs arrangements to allow trade with the EU are being outlined in the first of a series of "future partnership papers" being released by the Government.

Although negotiations on a new system are not scheduled to start for some time, the Government said setting out its aims showed the UK's "desire to ensure our exit from the EU is smooth, orderly and successful".

One option being put forward by Mr Davis for new arrangements would see the UK manage a new customs border with administration streamlined to the "fullest extent possible".

The Brexit Secretary will also float plans for a customs partnership with the EU that would negate the need for a customs border between the UK and the rest of the bloc.

A position paper on the fraught issue of the border between Northern Ireland and the Republic will be published on Wednesday, ahead of the third round of Brexit negotiations in Brussels at the end of the month.

Sir Keir Starmer, the shadow Brexit secretary, called the proposals "incoherent and inadequate" in response to pleas for certainty from British businesses.

"Instead, the Cabinet remain split on key issues and cannot decide between two very different but equally unachievable options," he said.

"The first proposal suggests 'a new customs border with the EU' could be introduced without disrupting trade; the second suggests a new borderless customs partnership could somehow be agreed while Britain also signs external trade deals.

"These fantastical and contradictory proposals provide no guidance for negotiators or certainty for businesses.

"The proposals also make it less likely that necessary transitional arrangements will be in place by March 2019."

It comes after Chancellor Philip Hammond and International Trade Secretary Liam Fox said the UK would pull out of both the single market and the customs union in 2019.

Labour former shadow chancellor Chris Leslie, a leading supporter of the Open Britain campaign group, said: "It looks like the new unified position in the Cabinet is to return the Government to the territory of wanting to have their cake and eat it.

"Ministers claim we can leave the customs union and yet still achieve 'the most frictionless customs agreement anywhere in the world' but with absolutely no detail about how such a miraculous new system will be achieved.

"It is a fantasy to pretend we can have the freest and most frictionless trade possible with our largest partner when the Government remain intent on pulling Britain out of the customs union."

Tom Brake, the Liberal Democrats Brexit spokesman, said the Government's "extreme Brexit will end up leaving Britain poorer".

He added: "Even if they were agreed to by the EU, these proposals will only delay the economic pain caused by leaving the customs union.

"We still face the prospect of more red tape for businesses, longer queues at our borders and higher prices for consumers once the transition comes to an end."

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