I note there is some backlash from Brexiteers about last week's debate in parliament on the customs union. They're suspicious that it is being used as a wedge to keep us in the single market and eventually, in the EU itself. And of course, they are to an extent right to be suspicious. Brexiteers claim that worries about being out of the customs union are overblown and in particular, with the growing use of electronic technology, customs procedures can be managed by traders without the need for border checks.
They point that it is "simply" necessary to fill in form EUR1 to make a declaration about Rules of Origin to make sure any preferential rates of duty only apply to goods made in the UK, or to a minimum percentage of it. For example, cars have to have a minimum local content of 55%, I believe. In the debate, Yvette Cooper said many exporters were worried about having to make these declarations and to remake them whenever they change their suppliers from one country to another.
Needless to say, as we remainers probably overstate problems, Brexiteers understate them.
Using form EUR1, the manufacturer has to breakdown the percentage of the goods being exported to the EU that come from countries other than the UK. On the surface it looks quite simple. But if you are a manufacturer, with complex supply chains involving countries outside the EU, and a complex product like a car perhaps, with thousands of parts, it probably doesn't look so easy. And not only do you have to work out the percentage by value of each part, you have to keep it up to date, and keep it in mind when changing suppliers, if you get close to the limit.
And for companies who don't export themselves, they may also find themselves drawn in to the problem if they're a supplier to a company that does.
We are not good at exporting anyway. The idea that breaking away from the customs union will increase our exports is to my way of thinking simply not credible. It's far more likely to reduce them as companies that export now to the EU, simply give up.
