The business minister Kevin Hollinrake had exciting news for British businesses on Tuesday. The government was, he said, “tackling red tape, cutting burdens for business and creating certainty for firms”.
It sounded like just the kind of benefit Brexit was meant to bring in its wake.
Yet the particular tangle of “red tape” Hollinrake was promising to snip away was one of the government’s own making: a new UK standards system for consumer products, from toys to fireworks.
The idea was that instead of complying with the long-familiar CE mark, showing that a product conforms to the EU’s safety rules, businesses selling into the UK market alone could instead apply for a homegrown red, white and blue equivalent – the UKCA.
Ministers had already repeatedly postponed the date at which UKCA was meant to replace CE in the British market. Now it has been delayed indefinitely.
Firms that want to switch to the UKCA for products sold into the domestic market alone will still be able to do so – but the CE mark will also remain valid here.
The move has delighted business groups, which had been lobbying hard against the prospect of firms that sell into the much larger EU market having to carry out two separate sets of safety tests, with two separate regulatory bodies.
A survey by the British Chambers of Commerce (BCC) in 2021 found that just 8% of businesses were in favour of scrapping the CE mark by the start of this year, as was then the plan. One firm told the BCC this week it had spent a six-figure sum preparing to comply with the UKCA – but was still relieved it could now revert to the CE system.
Having belatedly conceded the point, the government announced – apparently without irony – that by allowing businesses to continue following rules made in Brussels, it was cutting their costs and freeing them up to boost economic growth.
That wasn’t quite the message pushed by the Brexiters during the referendum campaign, when they frequently cited Brussels bureaucracy as a drag on British businesses’ dynamism.
“Divergence” – the ability of the UK government to devise its own light-touch regulations – lay at the heart of the ideological struggle that split the Conservatives over Brexit and delivered Boris Johnson the premiership.
Theresa May’s ill-fated Chequers plan of 2018 included a joint EU-UK “rulebook” for key products, including manufactured goods. Johnson used a barnstorming party conference speech that year to warn that this approach would trap British businesses in “the tractor beam of Brussels”.
Yet given the size of the EU market, and its geographical proximity to the UK (a point memorably only grasped by Brexiter Dominic Raab two years after the vote), the power of that tractor beam over many of Britain’s exporters was always likely to remain significant.
Of course, the EU is not the only game in town – there are many faster-growing markets, and the government is keen to persuade exporters to look further afield. And in some areas, such as farming subsidies, Brexit has freed the UK to go its own way.
But with goods in particular, which still need to be physically transported to the end customer, geography really does matter – and many exporters are keen to continue selling into the vast market of the EU.
For now, the new UKCA regime replicates the CE mark anyway, rather than introducing less onerous post-Brexit standards. Indeed, the “level playing field” commitments that formed part of the trade and cooperation agreement should prevent any deregulatory free-for-all.
But while both remain valid that leaves exporters with little incentive to dump the CE mark and switch to the UKCA.
In practice, that is likely to leave many businesses complying with EU rules both at home and abroad – albeit out of choice – instead of the glorious “divergence” that Johnson and his pals believed they had won.
And over the years ahead, as EU regulations evolve and change, that may well revive an old question, in a new form: why are we complying with all these rules that we now don’t have any say in?
• The image accompanying this article was changed on 1 August 2023 to one of a CE mark that adheres more closely to EU guidance on how it should be reproduced.
