The United Kingdom could be sleepwalking into a legislative nightmare, which could upend its European Union (EU) Reset initiative, unless urgent action is taken, the British Chambers of Commerce (BCC) recently cautioned.<\/p>\n
The ‘EU Reset’ is a UK Labour government initiative launched in 2024 to mend relations with the EU after Brexit, focusing on a new strategic partnership, security and economic cooperation. It seeks to reduce trade friction, enhance defence and tackle migration without returning to the single market, customs union or freedom of movement.<\/p>\n
The EU is currently pursuing a \u2018Made in Europe\u2019 agenda that aims at protecting its industries from unfair international competition due to subsidies and tariffs. The EU\u2019s Anti-Coercion Instrument, its so called \u2018trade bazooka\u2019, is one aspect of this.<\/p>\n
The UK could be sleepwalking into a legislative nightmare, which could upend its EU Reset initiative, unless urgent action is taken, trade body BCC cautioned.
\nThe EU is pursuing a ‘Made in Europe’ agenda aimed at protecting its industries from unfair global competition due to subsidies and tariffs.
\nThis could squeeze UK firms and third-country suppliers out of supply chains, raising costs and bureaucracy.<\/p>\n
But among new proposals it is considering are content rules that mean up to 70 per cent of the components in the goods it makes must be of EU origin. It is also looking at new rules on sustainability, capping foreign direct investment and procurement.<\/p>\n
As the United Kingdom is now a third country supplier, this could squeeze British firms out of supply chains, increasing costs and bureaucracy, BCC said in a release.<\/p>\n
The next step in the proposals is the introduction of the Industrial Accelerator Act, expected soon.<\/p>\n
\u201cThere is a continuing debate between EU members as to how far it should push its Made In Europe agenda. But if a more extreme version is enacted, it would have a chilling effect on cross-border trade and cause chaos for EU based producers reliant on UK parts and components,\u201d said William Bain, BCC\u2019s head of trade policy.<\/p>\n
\u201cThe UK government is very much alive to this danger and dialogue is on-going, but this issue is not yet on the radar of enough firms, and its seriousness cannot be underestimated,\u201d he noted.<\/p>\n
\u201cWe would urge British companies to start speaking to their EU customers about this to make the case for continued supply chain integration and find out where they stand,\u201d he added.<\/p>\n
<\/p>\n
Fibre2Fashion News Desk (DS)<\/p>\n
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