Brexit negotiations: UK says it may seek 'temporary' customs union with EU

London: Britain might seek to remain in a customs union with the European Union for a time to avoid border chaos after leaving the bloc, the government's Brexit department said on Tuesday.

The Department for Exiting the European Union said there could be "a temporary customs union between the UK and the EU" to help businesses make the transition to life outside the EU.

Brexit Secretary David Davis said the transition period could last about two years.

File image of David Davis. AP

File image of David Davis. AP

In the long term, the department said, a "customs partnership" could eliminate the need for a border for goods travelling between Britain and the EU. Alternately, it suggested "a highly streamlined customs arrangement" could be set up, using technology to ease border procedures.

The proposal — one of a series intended to disprove allegations that Britain is underprepared for Brexit — drew a cool response from Brussels.

"To be in and out of the Customs Union and 'invisible borders' is a fantasy," tweeted Guy Verhofstadt, the European Parliament's Brexit coordinator.

Some British businesses have accused the government of being vague about whether there will be economic barriers with the EU after Brexit in March 2019. The persistent uncertainty — 14 months after Britain voted to leave the EU — is weighing on the economy.

Trade Secretary Liam Fox and Treasury chief Philip Hammond wrote in the Sunday Telegraph that in 2019 Britain will leave both the EU's single market in goods and services and its customs union.

The single market ensures tariff-less trade in goods and services and is linked closely by the EU with other rights, such as the right of EU citizens to cross borders. The customs union allows goods to move within the EU without checks, but also imposes tariffs on imports from outside the EU. That would prevent Britain striking new free trade deals while it remains inside the arrangement.

The British proposal says the UK should be free to negotiate new trade relationships during the transition period, something EU officials are likely to find problematic.

Scottish First Minister Nicola Sturgeon, who favours Britain's staying in the single market and customs union, accused the government on Twitter of having a "daft 'have cake and eat it' approach".

The customs proposals are the first in a series of papers covering thorny issues in the negotiations, which are due to resume in Brussels at the end of this month. Another, on the status of the border between Northern Ireland and the Republic of Ireland, is due to be published this week.

Updated Date: Aug 15, 2017 18:33 PM

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