The European Commission announced in January 2018 that certificates issued by UK Notified Bodies will lose their validity immediately upon the UK’s withdrawal from the EU, in the absence of transitional arrangements. In my last post, I pointed to Commission guidance that certificates issued by a Notified Body should not lose their validity immediately in the event that it ceased operation, and asked why it was adopting a different approach with respect to UK Notified Bodies and Brexit. In this post, I describe the detailed arrangements that are currently in place to allow medical devices to continue to be marketed in the EU for a ‘grace period’ when a Notified Body ceases operation, and ask whether there is any good reason why similar arrangements should not be adopted in the event of a No Deal Brexit.
The European Commission has stated that, in the event of No Deal, product safety certificates issued by UK Notified Bodies (NBs) will become invalid for products placed on the EU-27 market after the withdrawal date:
In response, UK NBs have been seeking notified status in the EU-27 through a subsidiary or other arm of their company or organisation. In my last post, taking medical devices as an example, I examined how far this process has progressed. The largest UK medical devices NB, BSI, achieved notified status in the Netherlands in November 2018, and began transferring certificates across to its Dutch subsidiary. Lloyds Register and SGS UK are part way through the process, while UL UK do not appear to be making any such No Deal preparations.
While some manufacturers may have acted independently after the UK’s decision to leave the EU, and transferred to a different company already notified in the EU-27, it would appear from certificates currently available online that many have stayed with their UK NBs. As things stand, therefore, a No Deal withdrawal could result in an immediate loss of market access for many medical devices, with potentially serious consequences for recipients of medical services in the EU-27, and for manufacturers worldwide.
SGS, the world’s largest, Testing, Inspection and Certification company, have remained sanguine, describing the Commission’s position as ‘extreme’, and expressing confidence that the EU-27 will adopt a ‘more pragmatic position’ and allow UK NB certificates to continue to be recognised while they are being transferred to EU-27 bodies:
In this short post I:
i) show that EU product safety legislation does not contain provisions which specify the status of certificates issued prior to a denotification;
ii) argue that current Commission guidance indicates strongly that there should be no immediate loss of validity of such certificates.
I am responding to a claim made by Sam Lowe that new non-tariff barriers to trade would be ‘highly disruptive’ in the event of a No Deal Brexit. I am confining myself to those technical regulations which come under the WTO Technical Barriers to Trade (TBT) Agreement, rather than those covered by the WTO Agreement on Sanitary and Phytosanitary Measures. Like Lowe, I see three types of TBT barriers arising:
i) An EU ‘importer’ would be required (see part 2), who would have a responsibility to carry out checks that the manufacturer had carried out the necessary conformity procedures.
ii) UK ‘Notified Bodies’ will lose their notified status, and the certificates they have issued will lose their validity.
iii) UK exports to EU-27 would be subject to regulatory checks at the border.
In this post, I begin an examination of the difficulties that may arise in connection with UK Notified Bodies.
I am responding to a chapter by Sam Lowe on non-tariff barriers to trade in a report on the implications of trading on WTO terms in the event of a No Deal Brexit. I am confining myself to those technical regulations which come under the WTO Technical Barriers to Trade Agreement, rather than those covered by the WTO Agreement on Sanitary and Phytosanitary Measures. I began in Part 1 by addressing the question, raised in the chapter’s heading, as to whether regulatory divergence would give rise to technical barriers to trade. I argued that if the UK regulations diverged from the EU after Brexit, this could create challenges for manufacturers, wherever based, to overcome in producing goods that satisfied the new regulations. These differences in regulations could be considered to be barriers, or hurdles, to the UK market, but hardly to the EU-27 market.
On 6 December 2019, ‘The UK in a Changing Europe’, an ESRC-funded ‘Initiative‘ at King’s College London, published a report on the implications of trading under World Trade Organisation (WTO) rules (without a Free Trade Agreement or Customs Union with the EU) in the event of a no deal Brexit. Chapter 7, by Sam Lowe of the Centre for European Reform, concerns non-tariff barriers to trade under WTO trading: 1
My purpose here is to address Lowe’s first question:
I confine myself to those technical regulations which come under the WTO Technical Barriers to Trade Agreement, rather than those covered by the WTO Agreement on Sanitary and Phytosanitary Measures.
- As is customary, I use ‘WTO trading’ as a shorthand for trading under WTO rules without a GATT Article 24(8) customs union or free trade area. ↩
Introduction: why are Government ‘sources’ predicting failure?
On 4 November 2016, the day after the High Court had handed down its judgement that the Government ‘does not have power under the Crown’s prerogative to issue the Article 50 notification’, the Prime Minister’s spokesman said that ‘the focus of the government’ was on the Supreme Court appeal, and that they remained ‘confident of winning that case and proceeding with Article 50’.
On 7 November 2016, David Davis told Parliament that the Government disagreed with the High Court’s judgement, that their position remained that ‘triggering Article 50 is properly a matter for the Government using its prerogative powers’, and that they would therefore be appealing the judgement at the Supreme Court.
On 1 December 2016, John Finnis, Emeritus Professor in the Faculty of Law at Oxford University, in his Thomas More Lecture at Lincoln’s Inn Fields, four days before the Supreme Court hearings and therefore presumably on the basis of the Government’s written submission, said that ‘the principle of constitutional dualism at the intersection of international affairs with domestic law’ had ‘been presented much more clearly and fully’ than it had been to the High Court, intimating that he had not given up hope of a reversal of the decision.
I find it odd therefore that Government sources were reported by the Guardian on 11 January 2017 to be ‘convinced’ that ‘seven of the 11 judges will uphold the high court’s’ judgement. Why the defeatism?
In my penultimate post I recorded several instances when the Government, with support on occasion from the Opposition, undertook to make our EU membership a matter for decision by the British people in a referendum, calling that decision ‘the final say’, or ‘the final decision’. I pointed out that if the Supreme Court were to uphold the Judgement of the High Court, then the final decision would be made by Parliament, and the referendum would become, so to speak, the penultimate decision, and no longer the final one. Thus the Government would be obliged by the Courts to breach its commitment to the British people, which is a very serious matter.
I am pleased that Richard North has responded today to my series of posts on conformity assessment and the WTO option, which begin here. He claims, first of all, that I have made mistakes ‘relating to the activities of “notified bodies” and the continued recognition of UK bodies after a sudden withdrawal by the UK [from the EU].’
Status of UK Notified Bodies after Brexit
In part 2 of my series, in the section entitled ‘UK Notified Bodies after Brexit’, I explain why I think it ‘almost certain’ that, in the absence of an agreement on the mutual recognition of conformity assessment bodies, the UK Notified Bodies would lose their notified status. I conclude the section by stating that I will henceforth assume that to be the case for the sake of the analysis:
23 January 2013, Bloomberg: ‘this will be your decision’
David Cameron, in his Bloomberg speech of 23 January 2013 in which he announced a new Conservative Party policy to hold a referendum on the UK’s membership of the European Union, made it clear that the decision was to be made by the British people:
In my last post I traced the origins of the 1998 EU-US MRA on conformity assessment back to the Internal Market program of 1985-92 and its New Approach to product safety legislation. In accordance with the Community’s obligations under GATT, and the GATT Standards Code in particular, both the essential requirements that products had to meet, and the assessment procedures laid down to demonstrate their conformity with those requirements, were formally exactly the same for all products, whether imported or produced in Member States. The potential problem for third countries was that the third party conformity assessment bodies (CABs), whose involvement was necessary for some products, were designated by Member States and might naturally be expected to be established in the same Member State. Would it therefore be necessary for third country manufacturers to send their products to laboratories in the Community for type approval? And where the procedures required inspection of the manufacturing facilities and quality control systems, would inspectors have to come from Europe to carry them out, at considerable expense to the manufacturer?