The overall process for trading between Northern Ireland and non-EU countries will continue broadly as it does today. Further guidance is available:
The UK Government will negotiate and deliver trade deals on behalf of the whole United Kingdom. This means that Northern Ireland will benefit from any free trade agreements (FTAs) the UK makes.
Case study: NI whiskey manufacturer
Whiskey produced on the island of Ireland benefits from protection under the EU’s Geographical Indications scheme, and this will continue to be the case for whiskey produced in Northern Ireland after the transition period for as long as the Northern Ireland Protocol remains in force. Such goods will need to meet rules of origin established by UK FTAs.
Geographical indications are protected names or descriptions on a product which identify it as originating from and having a quality or reputation attributable to a particular region or place. Geographical indication status protects those products from imitation and the name cannot be used to describe a similar product. We recognise the strong regional and cultural importance and identity of GIs which resonates amongst UK consumers. We know that people want to support their local producers, local culture and local economies and people identify with the products that are made where they live.
Rules of origin are also important to whiskey manufacturers in NI. The preferential rules of origin that apply to a given product are agreed between partner countries and included in their FTA. Rules of origin can therefore vary depending on what the country of import will be. Some examples of what these rules might look like include:
- Whiskey manufactured from goods other than those contained within chapter 22.07 and 22.08 (undenatured ethyl alcohol of a strength >80% and <80% respectively) can be considered as originating in the UK (UK-South Korea FTA)
- Whiskey wherein the value of non-originating ingredients does not exceed 15% of the value of the finished good (UK-Morocco FTA)
Provided that Northern Irish whiskey meets the product specific rule (PSR) under the applicable FTA, it will be considered originating in the UK. Under continuity agreements signed to date, we have also agreed with partner countries to treat EU content as also originating when incorporated in goods traded with one another provided sufficient processing rules are also met.
The UK has signed trade continuity agreements with 48 countries, as of 31 January 2020, to replicate the effects of existing EU trade agreements, ensuring continuity for UK businesses following the transition period. This includes agreements with South Korea, Switzerland, and the Southern Africa Customs Union and Mozambique (SACUM) trade bloc, and overall accounts for £110 billion of UK trade in 2018.
Beverage exports to South Korea and Switzerland were worth £3.2m and £0.9m respectively in 2019. Exports to the EU were worth £233.7m, and to the US were worth £65m.
Source: The statistics used here do not estimate the value or impact of the trade agreements themselves. They provide, for context, the overall value of the UK’s trade with countries covered by these agreements. Data covers the period 2018; Office for National Statistics (ONS) statistics on UK total trade: all countries, non-seasonally adjusted October to December 2019.
Northern Ireland businesses will form part of the UK’s domestic industry for the purposes of trade remedy investigations and will benefit from the UK’s independent trade policy. Trade remedies measures are a policy tool used to provide a safety net to protect domestic industries against injury caused by unfair trading practices, such as dumping or subsidies, or unforeseen surges in imports. They usually take the form of an increase of duty on imports of specific products following an investigation. Under the Protocol, UK trade remedies will apply to all goods from the rest of the world entering Northern Ireland other than those ‘at risk’ of entering the EU. The UK’s Trade Remedies Authority, when established, will be able to ensure that the trade remedy measures it determines are appropriate for the whole of the UK, including Northern Ireland.
More broadly, the principal change that will apply to such movements will concern the system by which tariffs are applied for goods imported from outside the EU, which will form part of the UK-EU Joint Committee decision on ‘at risk’ goods. The UK’s tariff regime will apply, with Northern Ireland traders benefitting from the application of FTAs struck by the United Kingdom with third countries other than where a good is at a genuine and substantial risk of moving into the EU within the terms of the Joint Committee decision. Further guidance will be provided on the specific operation of this regime in the light of that Joint Committee decision.
In order to avoid new burdens for traders in engaging with this system, Northern Ireland businesses importing goods into Northern Ireland from third countries will be eligible for the Trader Support Service.