A proposed agricultural agreement between the UK and European Union will reduce some trade barriers but leave British exporters facing continued bureaucratic costs, the House of Lords European affairs committee heard Tuesday. The sanitary and phytosanitary deal, while eliminating certain physical checks, stops short of removing customs, VAT, and security declarations that add expense and complexity to cross-Channel commerce.
The agreement would end physical inspections of farm produce and eliminate the need for veterinary certificates, which currently cost £200 each. It could also remove requirements to label food as "Not for EU," which William Bain, head of trade policy at the British Chambers of Commerce, described as "a significant problem" for wholesalers and distributors. For Scottish langoustine and oyster exporters, the deal could restore direct access to European markets that was lost when border checks reduced seafood shelf life, making it impossible to deliver fresh catch to Paris restaurants within a day as they did before Brexit.
The Regulatory Trade-Off
Labour's strategy for reducing food export barriers requires what experts call "dynamic alignment"—automatically applying all future EU rules and regulations for farm produce. The UK is negotiating acceptance of 76 laws either passed in Brussels or from which Britain has already diverged in the agricultural food sector. This approach effectively cedes regulatory authority to the EU in exchange for smoother border crossings.
Shanker Singham, chair of the Growth Commission and former adviser to MPs on Brexit arrangements for Northern Ireland, told peers the government had alternative options. He pointed to "mutual recognition" of food standards, similar to the system supporting trade between New Zealand and the UK, which would eliminate the need for dynamic alignment while still facilitating commerce.
Unused Negotiating Leverage
Singham highlighted a significant trade imbalance favoring British negotiators: approximately 23% of the EU's global agrifood exports go to the UK, with "much less" flowing the opposite direction. This disparity stems partly from the EU implementing all Brexit border controls immediately, causing up to 20,000 British businesses to stop exporting to the bloc. The UK, by contrast, never applied controls with equal rigor, eventually opting for random inspections on fresh food.
"The interesting thing here is that the UK government hasn't really used the leverage it has," Singham said. He suggested Britain could pursue mutual recognition arrangements like those between New Zealand and Australia, where both sides recognize each other's standards without surrendering regulatory sovereignty. "If you don't ask, you don't get," he told peers. "One has to be very, very careful when one is giving away one's own regulatory authority in any area."
Sam Lowe, head of trade and market access practice at Flint Global, defended dynamic alignment by noting that "physical inspections would pretty much disappear," something a mutual recognition deal would not guarantee. He characterized the UK's position as seeking EU recognition of British dynamic alignment to achieve better treatment for exporters. "The EU exporters have an advantage because the UK recognises their rules. So what we are actually doing is asking them to give us something back on that," Lowe said.
Bain emphasized that while the SPS agreement would have a "modest" impact on the UK economy overall, it would be significant for affected sectors, particularly Scottish seafood exporters who lost lucrative European markets when Brexit border procedures made their perishable products unviable for export.
Why This Matters:
The proposed agreement represents a fundamental choice about Britain's post-Brexit regulatory independence. Dynamic alignment with EU agricultural rules offers administrative convenience for exporters but permanently subordinates UK food standards to Brussels decision-making without British input. The trade imbalance—with the EU sending far more agrifood to Britain than it receives—suggests the UK holds stronger negotiating cards than the government has deployed. Alternative approaches like mutual recognition could preserve regulatory sovereignty while facilitating commerce, but require assertive negotiation. For businesses, the persistence of customs and VAT paperwork means Brexit's administrative burden continues regardless of the SPS deal, maintaining costs that particularly burden small and medium enterprises. The £200-per-certificate veterinary cost elimination helps, but doesn't address the broader structural expenses of post-Brexit trade that caused 20,000 firms to abandon European markets.