SWA backs Theresa May’s Brexit deal

6th December, 2018 by Melita Kiely

The Scotch Whisky Association (SWA) has stated its support for UK prime minister Theresa May’s Brexit deal and warned MPs that rejecting the proposals will create “considerable uncertainty”.

Brexit Spirits Europe

The SWA said it supports UK prime minister Theresa May’s Brexit deal

The UK is due to leave European Union on 29 March 2019. UK and EU officials agreed the draft text of a Brexit withdrawal agreement in November. However, the agreement must also be backed by the UK parliament for it to come into effect.

The agreement includes a transition period until December 2020, which the SWA said is “essential” to allow “adequate time” for the Scotch whisky industry to prepare for any changes in how the UK trades with the EU and global markets as a result of Brexit.

Other Brexit issues addressed in the withdrawal agreement include continued reciprocal protection for UK geographical indications (GI) in the UK; EU excise movement and control system (EMCS) until the end of the transition period; the UK continuing to benefit from EU free trade agreements (FTA); and provisions to provide legal certainty that EU citizens can continue working in the UK and vice versa.

Though the agreement is intended as a “starting point” for future negotiations, the SWA said the “general direction of the document is encouraging”.

In a statement, the SWA said: “On balance, the draft withdrawal agreement and accompanying political declaration on the future UK-EU relationship stand up well against the Scotch whisky industry’s Brexit priorities.

“The SWA therefore supports approval of the two negotiated texts by the UK and European parliaments.

“If the deal is rejected this will create considerable uncertainty for the industry and greatly increase the potential of a no deal Brexit in March 2019.”

The SWA also highlighted the risks it foresees in the case of a ‘no deal’ Brexit scenario.

The trade body noted higher tariffs on glass, cereals and machinery that could lead to higher production costs for the Scotch whisky industry; changes to customs and excise procedures for trade with the EU due to losing access to the EMCS; and changes to labels which could cost around £1.6 million (US$2m) a year.

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