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NEWS

14 November 2017

The UK Trade Bill 2017

Last week, the Trade Bill 2017 had its First Reading in the House of Commons. When introducing the Bill to Parliament, the Government claimed that it “will ensure the UK is ready for when we leave the EU, providing continuity for individuals, businesses, and international trading partners”.   The Bill in fact is a very modest one in its scope, amounting to only eight substantive clauses, and merely sets out a framework for the Government’s Transitional Adoption plan.  It refers to the implementation of existing EU Free Trade Agreements (FTAs) on exit day. But the Bill does not refer to the fact that a UK FTA will have to be entered into with the signatories to any EU FTAs, which will require their active agreement.

The Bill makes provision for (1) the implementation of the Agreement on Government Procurement (the GPA); (2) the implementation of any future international trade agreements; (3) the establishment of the Trade Remedies Authority; and (4) the collection and disclosure of information relating to trade.

The Bill proposes that the implementation of any future trade agreements will be done through regulations and contains Henry VIII clauses to empower Ministers to modify any primary legislation that is retained EU law. Whether those controversial clauses make it onto the statute book will be dependent on what happens to similar clauses in the EU (Withdrawal) Bill 2017 currently being debated in Parliament.

For procurement lawyers, it is now reasonably certain that at the very least there will be a UK procurement regime post Brexit modelled on the provisions of the GPA (on the assumption of course that all other signatories to the GPA agree to the UK’s accession, which in itself may not be straightforward to achieve). There is no indication in the Bill or its Explanatory Notes that this regime will be any different to the current EU procurement regime that itself is GPA compliant, but conversely there is no guarantee that it will not differ in certain respects. The GPA is a plurilateral agreement within the framework of the WTO, meaning that not all WTO members are parties to the Agreement. At present, the Agreement has 19 parties comprising 47 WTO members. Another 31 WTO members participate in the GPA Committee as observers. Out of these, 10 members are in the process of acceding to the Agreement.  The fundamental aim of the GPA is to mutually open government procurement markets among its parties. As a result of several rounds of negotiations, the GPA parties have opened procurement activities worth an estimated US$ 1.7 trillion annually to international competition (i.e. to suppliers from GPA parties offering goods, services or construction services).

The Bill reflects the Government’s view that the UK will need to accede in its own right to the GPA (which the UK currently participates in by virtue of its EU membership). The Bill anticipates regulations implementing the GPA (whether the current GPA as amended on 29 March 2012, or any subsequent version) coming into force on the day the UK accedes to it.

The role of the Trade Remedies Authority is, at least in this Bill, envisaged solely to be advisory: it will provide the Secretary of State with “such advice, support and assistance as the Secretary of State requests” in connection with the conduct of an international trade dispute.  However, the Explanatory Notes refer to wider powers of the TRA to carry out investigations, and impose and enforce trade remedy measures (i.e to protect UK industries from to counter injurious trade practices (such as dumping or subsidies). That role is currently performed by the European Commission on behalf of all Member States. These wider powers will be set out in a separate Bill (The Taxation (Cross-Border) Trade Bill) soon to be introduced to Parliament.

Sectors:
Commerce / Regulation