No deal is not an option

Could food, medicines and petrol run out in the event of a no deal scenario? The short answer is yes, absolutely. It only takes a small disruption to sophisticated supply chains for things to grind to a halt.

Leaving the EU without a deal means becoming a third country overnight. The status of having no formal trade relations. The UK would not exist as an entity anywhere inside the EU legal framework. We would be subject to third country customs controls without any of the single market product approvals or valid certification.

If you don’t have the valid paperwork for your goods to circulate freely in the market then you have to find a named importer and have your products re-certified inside the EU – at considerable cost. Some classes of foodstuffs must be diverted to border inspection posts.

So that means if we go from single market members to being a third country then overnight the ports back up, Operation Stack goes into effect and lorries are sat on the motorway for days. That takes trucks and drivers out of circulation. The normal flow of supply chains is interrupted.

Remember this works both ways for trucks coming in and out of the country. Meanwhile companies by law have to file declarations which our current system is not designed to cope with. For some suppliers there will be no point in trucks even leaving the depot.

With roads jammed with trucks, supply chains collapsing very rapidly we see rumours of shortages which leads to panic buying. It happens every time we get even a dusting of snow where Tesco runs out of bread and loo roll even if there is no actual shortage.

Those of you old enough to remember the fuel strikes will remember how perilously close the country came to grinding to a complete halt. This would be the same with fuel lorries trapped in traffic. The way the EU legal system works is that if there is no paperwork and there’s no tick in the box then there is no trade.

All the while keep in mind that we will have been ejected from the treaty system governing airways and flight-plans, and without legally valid flight-plans then aircraft are grounded. All rights in the EU airline market are rescinded.

There is nothing in WTO rules that compels the EU to breach its own rules even in an emergency. Driving licences wouldn’t be valid, nor would qualifications so there would be no mutual recognition of conformity assessment. Veterinary inspectors, drivers and pilots would be disqualified.

This is not “remoaner” speculation. Our own findings at The Leave Alliance paint a pretty grim picture of the WTO Option. This is a simple matter of law. If we have no formal relations with the EU then trade simply does not happen.

Longer term, as a third country, the costs of delays, inspections and re-registration make UK business uncompetitive in the EU. Costs go up, contracts are lost, deadlines are missed, tariffs kick in. This is what it means to be outside the European Economic Area.

All of this has been made clear in the EU’s Notices to Stakeholders. These are formal notifications based on the current law. This is no scaremongering or diplomatic threat. This is the business end of the EU.

We don’t know how long it would take to get the trucks rolling again. We’d have to revert to paper declarations because the current IT is not set to cope with the volumes of declarations nor is it mapped to a third country regime.

There are mid-term fixes in the form of bilateral agreements but these would take time and since the UK will have left without paying, the EU would not be in a rush to do us any favours. It will take years to rebuild a functioning customs and regulatory system.

In the meantime businesses cannot afford to wait. Suppliers to EU assembly lines will have no choice but to relocate. Delays will naturally mean production slowdowns and all the secondary suppliers will take the hit.

Trade is more than just movement of goods and there are far bigger worries than tariffs. By leaving without a deal all the otherwise manageable problems of exit happen overnight without the capacity to cope with them. We would be in very serious trouble.

Frictionless trade does not happen by accident. It is the product of thirty years of technical and regulatory collaboration and the result of several strands of agreements on everything from fishing to aviation. Without formal status in the system then UK trade collapses.

Additionally, it’s not just the immediate effects we must consider. It’s the ripple effect that passes through every supply chain, every regulatory system and anything that depends on licencing, certification and approvals. Nearly all of it has an EU dimension.

Without alternative arrangements a lot of our insurances become invalid, contracts voided and work will grind to a halt an major infrastructure programmes. It will simply be illegal to operate without valid insurances.

So deep and comprehensive is EU integration that there is no escaping the regulatory gravity of the EU without serious and lasting harm. It is therefore not remotely realistic to suggest that things can function without a formal framework for trade. Leaving without a deal simply is not an option.

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8 comments

  1. StevenReply

    We WON’T get a deal UNDER ANY CIRCUMSTANCES. This is because the EU is, as an organisation, TOTALLY DEDICATED to ‘the project’ of ever greater integration and the eventual construction of SINGLE STATE covering the whole of the present EU. Thus, even if it results in damage to their economies, if they can make the process of us leaving as tortuous and as troublesome as possible TO DETER OTHERS from doing this then they will do so. THEY HAVE NO INTEREST IN A DEAL FOR THIS REASON AND THAT WON’T EVER CHANGE.

    The choice for us is to EITHER respect the referendum result and become a ‘third country’ ie a REAL INDEPENDENT, SELF-GOVERNING COUNTRY once again that Ted Heath and his CRIMINAL CREW threw away in 1972 and this WILL BE AS A RESULT OF LEAVING WITHOUT A DEAL or to cancel Brexit entirely.

    The EU is a thuggish organisation and they are continually throwing-out EVERY suggestion the British government has made to remove the obstacles to leaving ie their obstinate behavior over the Irish border. Indeed the latest incident of this happened just today.

  2. Jason BReply

    Agree Steve, we are being brought to our knees for an over riding purpose. I dread to think what will come if this nation suddenly seized up. We have as a nation by the influence of the lefties need to turn back to past good fundamentals, (example : we have the increase of the broken family unit – something has gone amiss) We need folk such as Jacob Rees Mogg to restore both a moral up lift and a belief we can be a self governing nation without the EU.. The two go together.

  3. StevenReply

    If it were me, I would threaten the other EU countries with a trade war to try and make them see sense and realise we ACTUALLY VOTED TO LEAVE so they negociate a trade deal with us. 80% tariffs or more on Porsches, BMWs, Volkswagens and French Champagne and wines may concentrate their minds but this won’t happen because Teresa Maybe/Mayhem IS a REMAINER and she is a member of party that is ultra-fanatical about this concept of free and open trade even when, as it so often is, detrimental to BRITISH NATIONAL INTERESTS. It’s high time we upped the ante and got tough.

  4. John HartReply

    Our legislators will soon have a choice between a Traitors’ Brexit and No Deal. We need to get behind No Deal and stop fantasizing about other arrangements, which fantasies just waste energy that could be used to avert abject national disaster. No Deal is the future. We are just going to have to cope.

  5. Phil JonesReply

    Totally agree, Steven. Leaving without a deal is in fact THE ONLY OPTION. How can a organization having LEAVE in its name not recognize that?!!

  6. Ken WorthyReply

    Ridiculous article – Ken Clarke would have been proud of it.
    There might be no grand overarching deal, but that doesn’t mean that a host of other protocols and agreements couldn’t be signed – they don’t need to be wrapped into a big overall agreement. EU businesses and voters would be very badly affected if the Commission just let everything go to hell because Britain wouldn’t submit. Other countries would also be badly affected. The member states would never let the Commission take matters that far.

  7. Petrina HoldsworthReply

    Sadly what Peter North is stating is essentailly correct in my view.
    Had we been trading with the EU for years under WTO rules we would have ironed out many of the problems over the years.
    It isn`t that WTO rules are unworkable they just need time . Now we don`t have it.
    .It is true that both sides would suffer if we went over “the cliff edge” but Barnier was banking on us blinking first . Our present governement hasn`t just blinked it has suffered from a very apparent nervous twitch!
    I think that we all know that the final deal is going to be a botch job.
    Maybe our old friend Boris is right, maybe we should have put Trump in to do the deal.

  8. Pingback: Separating the wood from the trees - Campaign for an Independent BritainCampaign for an Independent Britain

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