House of Lords European Affairs Committee finds trade deal will reduce costs for the UK fish processing industry, which employs around 18,000 people across the UK, almost three quarters based in Scotland, East Yorkshire and northern Lincolnshire.
On Monday, The House of Lords European Affairs Committee published a report on the Free Trade Agreement between Iceland, The Principality of Liechtenstein and the Kingdom of Norway and the UK.
The House of Lords is the second chamber of UK Parliament. It plays a crucial role in examining bills, questioning government action and investigating public policy.
This Free Trade Agreement (FTA) replaces the temporary arrangements agreed with Norway and Iceland at the end of the transition period.
As well as maintaining the arrangements in place before Brexit, the report highlights extra potential benefits in the new deal to the fisheries sector.
Norway has agreed to cut certain tariffs for imports of UK fish feed from 10.5% to zero, thereby achieving annual savings of some £4.1 million.
Rules of Origin
The feed plants in the UK supply primarily Scotland and Ireland, but can also deliver to Iceland, the Faroe Islands and Norway.
Attached to the Free Trade Agreement is an Annex on Rules of Origin.
This provides that if businesses in the UK import raw materials from Norway or Iceland, process them and use them in the manufacture of another product, and then re-export that product to Norway or Iceland, it will be deemed to have originated in the UK, thus benefiting from a zero tariff. The same rules will apply to goods manufactured in Norway or Iceland incorporating materials of UK origin.
Successful conclusions of negotiations
These measure would not only benefit businesses in Norway and Iceland, but would also reduce costs for the UK fish processing industry, which employs around 18,000 people across the UK, almost three quarters based in Scotland, East Yorkshire and northern Lincolnshire.
Lord Kinnoull, Chair of the Committee, said:
“We welcome the Government’s successful conclusions of negotiations on a Free Trade Agreement with Norway, Iceland and Liechtenstein and the speed with which agreement was reached.
“While the agreement is in part an exercise in restoring the position and seeking to avoid the imposition of new barriers to trade, rather than in removing existing barriers, its impact upon trade in goods and services could be significant particularly in the long term.
“We do however continue to have concerns about the timing and level of scrutiny and engagement for the free trade agreements that are being struck, especially in a deal involving two of the UK’s immediate neighbours in Iceland and Norway. It is of vital importance that Parliament at Westminster and the devolved legislatures have the opportunity to examine these agreements and feed into the negotiation process before it concludes.”
The Free Trade Agreement does not address access to fisheries or the allocation of quotas in UK, Norwegian and Icelandic waters. These issues were covered in respect of Norway, in the Framework Agreement on Fisheries, done at London on 30 September 2020, between the United Kingdom of Great Britain and Northern Ireland and the Kingdom of Norway.