The Northern Ireland Protocol came into effect with the UK’s official withdrawal from the EU on 1st January 2021 after a gruelling four years of negotiation.
The delicate nature of the Protocol stems from the necessity to preserve the Good Friday Agreement of 1998, which established a cooperative cross-border trading relationship between the Republic of Ireland and Northern Ireland. In order to maintain the EU’s customs union, the Northern Ireland Protocol places a trading border between Northern Ireland and Great Britain, while maintaining its free border with the Republic of Ireland, and by extension, the EU itself.
Northern Ireland is now in the unique position whereby it has a foot in both camps: unfettered access to the EU market, and free trade with the UK, giving it a potential long-term competitive advantage.
However, in the short term, there are industries that have faced increased pressure as a result of stricter border regulation on controlled goods. The biggest bone of contention lies in food produce, particularly dairy and meat, which are considered high-risk goods by the EU, and require added checks at the border.
The pharmaceutical industry is also struggling with the red-tape surrounding safety checks, and separate licensing for use in Northern Ireland. This is a supply chain issue that could, according to Mark Samuels, CEO of British Generic Manufacturers Association, see manufacturers withdrawing medicines currently supplied to the region.
The aerospace industry has hit a similar wall, with competition being at threat as a result of tariffs on materials imported from Great Britain which are classed as being ‘at risk’ by the EU.
IoD surveys have continually shown that of all the obstacles businesses have tackled during the transition period so far, customs difficulties have certainly been the most challenging.
Although the UK’s unilateral decision to extend waiver periods to 6 months on certain border controls ignited a legal backlash from Brussels, it is encouraging to see that talks are taking place between EU Vice President Maros Sefĉoviĉ and UK counterpart Lord Frost that might stimulate greater flexibility on both sides, and ease tensions.
For directors, the priority in Northern Ireland is to make the Northern Ireland Protocol work for business. From a practical perspective, businesses can take advantage of the support available to them via the Trader Support Service, or such business representative organisations as the IoD, in order to make the best out of the situation.
IoD’s Moving goods from Great Britain to Northern Ireland Explainer:
'Moving Goods from Great Britain to Northern Ireland' Explainer | Institute of Directors | IoD
Trader Support Service:
Home - Trader Support Service
HMRC guide to trading with Northern Ireland
Trading and moving goods in and out of Northern Ireland - GOV.UK (www.gov.uk)