The European Union said it will not allow the United Kingdom to continue benefiting from its customs procedures and duty collection once it exits the EU customs union.
“The EU cannot — and will not — delegate the application of its customs policy and rules, VAT and excise duty collection to a nonmember, who would not be subject to the EU’s governance structures,” said Michel Barnier, the EU’s chief negotiator, on Thursday after a meeting with Dominic Raab, who is the U.K.’s secretary of state in charge of the country’s EU exit.
“Maintaining control of our money, law and borders also applies to the EU’s customs policy,” Barnier added. “Any customs arrangements or customs union — and I have always said that the EU is open to a customs union — must respect this principle.”
The U.K. government had proposed an arrangement to the EU that would essentially allow it to collect both British and EU duties on cross-border trade, even though the U.K. would no longer be a part of the EU customs union.
The U.K. is expected to leave the EU on March 29, 2019, but is still working out how customs oversight of trade will be managed after the split.
Raab and Barnier are expected to continue their discussions on how U.K. and European customs matters might be handled post-Brexit.
“A customs union, which would help to reduce friction at the border, would come with our Common Commercial Policy for goods,” Barnier said. “Any customs arrangement will also have to be workable and must protect EU and national revenue, without imposing additional costs on businesses and customs authorities. This is the framework within which we will work with the U.K. over the coming weeks.”