UK-based organic food companies will face further obstacles to trade with EU countries when a ban on re-exporting organic products to the bloc comes into force on 1 January.
While the UK-EU trade deal allows the export of UK organic products to the EU until 2024, equivalency arrangements will no longer cover the re-export of re-labelled or re-packaged imported organic products to the EU.
As a member of the EU, the UK operated to the same rules as the rest of the bloc on organic. Following the end of the Brexit transition period in December 2020, a temporary extension of previous arrangements was agreed by the EC, which recognised UK organic certification (operated by the UK’s six organic control bodies, or OCBs).
Earlier this year the Commission proposed that the EU should cease to recognise the UK OCBs (including the Soil Association and OF&G). This measure has now been approved by Member States and becomes effective on 1 January. As a result, countrywide equivalency terms will apply, meaning that the UK organic sector will be bound by national trade arrangements negotiated with Europe.
While the UK-EU trade deal (TCA) allows UK firms to export organic products “grown, produced or processed in the UK or imported into Britain and then processed”, products that are imported into the UK for re-export are considered ‘out of scope’ and will be ineligible for export to the EU from January.
“WE CURRENTLY SEE NO WAY FOR GB BUSINESSES TO EXPORT TO THE EU, EEA OR NI ANY ORGANIC FOOD MATERIAL THAT’S NOT GROWN OR PROCESSED IN THE UK FROM JANUARY 1. THAT LEAVES NO TIME FOR BUSINESSES TO ADAPT”
One well placed organic sector specialist told Natural Newsdesk that up to one quarter of current UK organic export documents would fall into the out of scope category.
UK certification bodies, which lobbied EC representatives to reconsider removing UK OCBs and warned the Commission about the impact on wider organic trade of UK OCBs losing their status, are hugely frustrated by latest developments.
Lee Holdstock, senior business development and trade development manager at the Soil Association told Natural Newsdesk that reaction from the UK organic sector was “a combination of dismay and frustration”. He said: “We currently see no way for GB businesses to export to the EU, EEA or NI any organic food material that’s not grown or processed in the UK from January 1. That leaves businesses no time to adapt. It’s a really disappointing outcome. And it’s going to have a significant impact on trade.”
Holdstock added: “We still have yet understand how on earth the government agreed a TCA which has an organic acceptance or equivalency agreement, which all seems to relate to origins (as opposed to organic status). All in all this is a failure of the UK government to grasp the details of the trade deals, and the only way it can be resolved is through rapid but informed dialogue between the UK and the EU.”
Roger Kerr, chief executive of Organic Farmers & Growers (OF&G), warned that that the situation would “undoubtedly lead to increased complexity and costs for British businesses who have traditionally traded with countries in the European Union”.
He told Natural Newsdesk: “Through discussions with our European colleagues and Defra it appears that the EU Commission does not currently have the appetite to address the significant impacts on UK/EU trade of ‘out of scope’ products that will be impacted by the removal of UK Organic Control Bodies in Annex IV.
“At this point we believe there isn’t a route to legal recourse available. However, once the reciprocal trade issue begins to impact on European organic businesses in the middle of next year with the imposition of COIs by the UK Government, OF&G is hopeful that avenues to address this issue will open up.
In the long-term, there are benefits to accommodating the movement of ‘out of scope’ products for all parties. In the meantime, we’ll continue to liaise with Defra who are keen to maintain a dialogue and ultimately resolve the issue with the EU Commission.”
Some warn that the situation could become even worse from 1 July (2022) when the UK will start to apply full import controls for goods being imported from the EU to the UK. One organic industry insiders told Natural Newsdesk: “If in July GB starts insisting on its own COIs, in other words, if we adopt the same position, and there is a reversal of restrictions on movement, that could quickly lead to a shortage of raw ingredients for UK manufacturers”.