The United Kingdom left the European Union on 31st January 2020 without any agreement on future trading terms. Both sides agreed an 11-month transition period to give more time to thrash out a deal.
The so-called transition period ends on 1st January 2021 – 136 days away – and the people of the UK have no idea whether trade with the EU will be based on some kind of free trade agreement (FTA) or default World Trade Organization (WTO) rules.
The Construction Leadership Council (CLC) Brexit working group has been set up to produce business guidance to help the construction industry get ready and be prepared to maintain business continuity at the end of the transition period.
The group also intends to identify issues facing the construction industry, in the event of no agreement with the EU, that the government must address in the next 136 days.
The work of the group will be split into four workstreams covering:
• Movement of People: preparing for the new immigration rules, accessing alternative labour supply and reciprocal arrangements on skills and qualifications in new trade deals.This is chaired by Graham Watts, chief executive of the Construction Industry Council.
• Movement of Goods and Materials: preparing for the new customs regime, guidance on WTO rules in the event of no agreement with the EU and alternative sourcing opportunities in the rest of the world and the domestic market. This is chaired jointly by John Newcomb (Builders Merchant Federation) and Peter Caplehorn (Construction Products Association).
• Standards and Alignment: guidance on the Construction Products Regulation, EU notified bodies, CE marking, UK designated standards, UKCA marking and the longer term prospects of (de)harmonisation and (de)alignment.This is chaired by Peter Caplehorn (Construction Products Association).
• Data Adequacy: business awareness of the potential impact and mitigating actions on data flow in the event of no agreement with the EU and no decision by the European Commission on the UK’s ‘data adequacy’. This is chaired jointly by Mace legal director Amy Chapman and Tideway general counsel Celia Carlisle of (Tideway).
In addition, the existing workstreams of the CLC will also take on Brexit-readiness related work, helping to produce advice on procurement, contracts and other issues.
Last month CLC industry-side chair Andy Mitchell, the Thames Tideway chief, wrote to Alok Sharma, secretary of state for business, energy and industrial strategy, setting out his concerns. He said that the absence of information about future standards, tariffs and access to migrant labour put industry in a difficult position. [See our previous report here.]
Setting up the Brexit working group underlines these concerns.
The cause of British industry has not been helped by government U-turns, setting out new business requirements only to then scrap them; or maybe postpone them... no one yet knows which. For example, said Andy Mitchell, last year the government published the Construction Products (Amendment etc.) (EU Exit) Regulations 2019 to ensure regulatory alignment on exit day. But the government’s advice on the Construction Products Regulation in the event of a no deal was withdrawn earlier this year.
Andy Mitchell said today: “The CLC has a leading role to play in getting our business ready for the changes that will come at the end of the transition period. While businesses contend with the fallout from Covid-19 and adjust to the new ways of working, the clock continues to tick on reaching an agreement with the EU. Whether we reach an agreement or not, our relationship with our European neighbours and the rest of the world will change and we’ll be doing all we can to help the industry adapt, adjust and rise to meet the prime minister’s ‘build, build, build’ ambition.”
James Butcher, head of policy at the National Federation of Builders, is co-ordinating the Brexit working group. He said: “We’ve identified four key areas that we believe are critical for business continuity as we enter a new post-Brexit world. We will be publishing a suite of short guidance beginning in September that explains those changes and prepares businesses for what will happen both in terms of the changes we know about and in the event of no agreement. We’ll also be holding short online seminars in the autumn to explain and communicate the guidance produced.”
The Builders Merchants Federation (BMF) will co-chair the Movement of Goods and Materials workstream along with the Construction Products Association. The two organisations also co-chair the CLC's Product Availability Group, set up in the wake of Covid-19.
Britain’s construction machinery manufacturers are also agitated by all the uncertainty, not knowing what regulations they will have to observe come 1st January 2021 or whether they will even be able to comply. [See our separate report here.]