By: Benjamin Glick

Register_Doing Bus in UK FlyerAlthough products may pass certain safety and regulatory prerequisites in the U.S., doing so is not sufficient for manufacturers to export to the European Union.

Goods entering Europe must undergo a separate screening process to comply with EU regulations. Once they do they acquire a Conformité Européene (CE) mark and given approval to enter the 28-member trading bloc.

Access to such a large market has made the trouble of attaining the mark a worthwhile investment for U.S. exporters because it grants access to large economies such as Germany, France, and the United Kingdom.

However, on 29 March 2017 Prime Minister of the United Kingdom, Theresa May, triggered Article 50 of the Lisbon Treaty, which begins the process of the UK leaving the European Union.

European Union law requires a two-year grace period before it takes effect so little will change until March 2019, but among much more complicated and sensitive political implications is the state of the CE mark and imported product verification in the United Kingdom.

In the 24 months leading up to the break, current CE marking procedures will remain the same, but whether the UK will choose to undergo a structured withdrawal from the European Union (“soft Brexit”) or a sudden and un-provisioned break (“hard Brexit”) may set the tone for how the UK will choose to adhere to European trade regulations.

This has caused a great deal of alarm within the UK, causing business intelligence firm Dun & Bradstreet to lower its risk rating to “deteriorating” following Brexit in 2016 and once again in March 2017 when Article 50 was triggered.

Much of the anxiety surrounding Brexit is caused by the uncertainty it has created for the UK’s short and long term future. And while no country has ever left the EU, examples do exist of how European countries can continue successfully outside its membership.

Currently, Iceland, Norway, and Switzerland are European countries that have never joined the EU but abide by European law in order to sell their products in the Single Market, and their example may be how UK-EU trade is conducted.

Accounting for over 500 million consumers and 21 million small and medium-sized enterprises, the European Single Market is one of the most populated and wealthiest economic regions in the world, so it is unlikely the UK will jeopardize its trade relations with it by needlessly altering EU standards.

According to Conformance, an independent CE marking consulting group, the greatest change that will likely occur is in regards to the EU’s strong environmental requirements.

All conformity markings will continue to apply in the UK until it has officially separated from the EU. However, if the UK wishes to continue trading with EU countries it will likely keep most EU regulations in place.

While UK and EU trade requirements will clearly diverge in the long run, the British Standards Institution (BSI) which will have greater authority once Brexit has taken effect will remain a voting member of the European Committee for Standardisation (CEN) and uphold UK-EU trade harmonization.

For experienced exporters, it will likely mean dealing with different agencies, but they will also likely have similar requirements. However, due to adhering to two different agencies for access to the UK and EU member states, it means Europe as a whole will be more difficult to enter.

Yet, despite its growing complexities, Europe holds a large and prosperous market that will retain its value to exporters well into the future.

Join us Monday, August 14, 2017, in Grand Rapids, Michigan to learn more about Doing Business in the United Kingdom during a half-day conference underwritten by the Michigan Economic Development Corporation. More details on this event and registration can be found at VAGTC.ORG.

About the Contributor

Benjamin Glick is a student assistant at the Van Andel Global Trade Center. He has written for the Grand Valley State University student newspaper, The Lanthorn, and is double-majoring in English literature and journalism. Click here to read more from Benjamin