Conformity Assessment (Mutual Recognition Agreements) and Weights and Measures (Intoxicating Liquor) (Amendment) Regulations 2021

Lord Callanan Excerpts

Tuesday 15th June 2021 Grand Committee

Moved by

[Lord Callanan]

That the Grand Committee do consider the Conformity Assessment (Mutual Recognition Agreements) and Weights and Measures (Intoxicating Liquor) (Amendment) Regulations 2021.

Relevant document: 2nd Report from the Secondary Legislation Scrutiny Committee

[The Parliamentary Under-Secretary of State, Department for Business, Energy and Industrial Strategy (Lord Callanan) (Con)]

My Lords, I beg to move that these regulations, which were laid before the House on 12 May 2021, be approved.

The statutory instrument we are debating today implements important aspects of international trade agreements within the Government’s trade continuity programme, ensuring continuity for UK businesses. This includes certain mutual recognition agreements that have been signed with the USA, Australia and New Zealand along with a free trade agreement with Korea that contains relevant conformity assessment provisions. The UK-Japan Comprehensive Economic Partnership Agreement and the UK-Canada Trade Continuity Agreement also include protocols on the mutual recognition of conformity assessment. From hereon in, I will refer to the mutual recognition elements of all of these agreements as MRAs.

These MRAs support trade in goods between the UK and its partners by reducing technical barriers to trade. Importantly, they do so in a way that protects the UK’s robust product safety system. The UK’s product safety legislation requires certain products to be assessed to ensure that they meet requirements in that legislation; sometimes, this assessment is required to be done by third parties. MRAs can reduce barriers by allowing this conformity assessment to be undertaken by a body based in the UK for export to the relevant country. We make the same arrangements for our partners under the agreement so that procedures carried out by recognised overseas CABs are accepted for our domestic regulations.

This SI also implements one aspect of the UK’s free trade agreements in the broader trade continuity programme. As part of the UK-Japan Comprehensive Economic Partnership Agreement, we will give greater flexibility to importers of a traditional Japanese spirit called single-distilled Shōchū. The SI amends specified quantity requirements applying in Great Britain so that bottles of single-distilled Shōchū may be placed on the market in Great Britain in one of the traditional Japanese bottle sizes of 900 millilitres.

Let me now address each of these areas in more detail, starting with the measures we are taking both to recognise overseas bodies and to appoint UK bodies under these MRAs before moving on to the measures we are taking for single-distilled Shōchū bottle sizes.

To begin, let me address provisions for goods in scope of the UK’s MRAs that are assessed by UK conformity assessment bodies for export overseas. This SI provides for the Secretary of State to designate CABs as competent to assess that certain goods comply with the regulatory requirements of our partners under the MRAs as set out in a schedule to the SI.

For example, this means that where a UK-based CAB would like to be recognised by the Australian authorities as capable to assess goods under Australian machinery requirements, the body can apply to UKAS, the United Kingdom Accreditation Service, to be accredited as fit to test against those Australian requirements. The Secretary of State may then designate the body under the UK’s MRA with Australia to assess machinery for export to Australia. As a result, a UK manufacturer that uses the services of that UK CAB can now use the same body to do its accreditation for the Australian market and does not need to identify and start contracting with a CAB actually operating in Australia. Therefore, manufacturers are able to place products on the Australian market more cost-effectively, potentially passing those savings on to consumers.

I now move on to consider provisions for goods coming into the UK. Under the MRAs, the UK recognises the results of conformity assessment procedures carried out by recognised overseas CABs against domestic regulations. This SI makes it clear that assessments carried out by a recognised body based in one of our partner countries should be treated as equivalent to those carried out by a UK-approved body when relevant products are sold in Great Britain. These regulations do not change the detail of the requirements for third-party assessment, nor do they amend any requirements related to a product’s specifications. This means that the UK will maintain its robust product safety protections while continuing to reduce barriers to trade with our partners. The benefits are potentially significant here: trade with our MRA partners in radio equipment alone amounted to nearly £2 billion in 2019, although, of course, not all of these products will have required conformity assessment by a third party.

The regulations also provide for the Secretary of State to create a register of CABs that the UK recognises under the MRAs, defined as MRA bodies. This is communicated via the UK Market CAB database, a publicly available resource that can be used by businesses and regulators to verify quickly the status of CABs. These regulations also provide for Canadian accreditation bodies recognised by the UK under the UK-Canada Trade Continuity Agreement to be listed on the Government’s website.

This SI also provides that the Secretary of State, or a person authorised to act on their behalf, may disclose information to the other party to an MRA where required by an MRA. For example, we may communicate information regarding goods from the USA which have been suspended by UK enforcement authorities, as part of our co-operation commitments in the MRA with the USA. Disclosure will be made in accordance with data protection legislation.

This SI provides for a product known as single-distilled Shōchū, a spirit which is single distilled, produced by pot still and bottled in Japan, to be placed on the market in Great Britain in an additional bottle size, 900 millilitres. Prior to the UK-Japan Comprehensive Economic Partnership Agreement, single-distilled Shōchū bottled in Japan had been permitted in Great Britain, but only in quantities of 720 millilitres or 1,800 millilitres, in addition to the usual specified quantities for prepacked spirits. Providing for sale of this traditional bottle size was very important to Japan during negotiations of the UK-Japan Comprehensive Economic Partnership Agreement. This artisanal product is already on sale across the UK in other bottle sizes, so this change should not have a significant impact on consumers in Great Britain.

I shall now speak to the territorial scope of these regulations. For some provisions, the regulations will make amendments for Great Britain only, while others extend to the whole of the UK. Regulations 4 and 5, relating to recognition of conformity assessment by relevant overseas CABs, extend to Great Britain only. Northern Ireland will continue to recognise the results of conformity assessment procedures done under the mutual recognition agreements between the EU and the relevant third country. This is in accordance with the terms of the Northern Ireland protocol to the withdrawal agreement. Regulation 6, relating to the Secretary of State’s power to designate UK-based bodies under these agreements, will extend to the whole of the UK. CABs across the UK can therefore be designated under the MRAs.

Regulation 7, relating to information sharing, will also extend to the whole of the UK, to enable the Secretary of State to share relevant information required under the MRAs. Regulations 8 and 9, amending the permitted bottle sizes for single-distilled Shōchū, extends to Great Britain only. In accordance with the Northern Ireland protocol, single-distilled Shōchū will continue to be permitted on the Northern Ireland market in 720-millilitre and 1,800-millilitre bottle sizes, in addition to the usual specified quantities for prepacked spirits.

In conclusion, we are introducing these regulations to give effect to provisions which keep our barriers to trade low with some of our significant trading partners. As I have said, we do this while preserving our robust protections for product safety, as a responsible Government. This SI will provide certainty on the UK’s approach to recognising and designating CABs for certain products under the MRAs, as well as making necessary amendments to allow the 900-millilitre bottle size of single-distilled Shōchū to be placed on the market in Great Britain. I therefore commend these regulations to the House.

--- Later in debate ---

[Lord Callanan (Con)]

My Lords, first, I thank both noble Lords for their valuable contributions to this debate.

It is clear from what I said initially and from the contributions that this SI will maintain our robust product safety framework at the same time as reducing barriers to trade with some of our key trading partners. It does this by providing for the recognition in Great Britain of overseas conformity assessments for certain products under an MRA, while overseas bodies will be recognised in Northern Ireland under their country’s MRA with the EU; providing for the Secretary of State to designate UK CABs to assess against the requirements of our trading partners for certain products under an MRA; and amending rules in Great Britain to allow a traditional Japanese spirit to be imported in a 900-millilitre bottle size. In supporting this SI, we keep our trade restrictions low so that our manufacturers and consumers benefit from arrangements to minimise the duplication of conformity assessments.

My noble friend Lord Lansley noted with regard to Part 3 of the regulations, on Shōchū, that that amendment has been delayed beyond 30 March. As he pointed out, we let the relevant Japanese Ministries know that we were unable to implement the obligation by 31 March. As a fellow parliamentary democracy, Japan understood that it was important that the UK Parliament be able to appropriately debate the Trade Bill before we could introduce that provision. On my noble friend’s question about the distinction between Great Britain and Northern Ireland, he is correct that 5 gō bottles of 900 millilitres may be placed on the market only in Great Britain. I can tell my noble friend that there is express provision in the UK-Japan CEPA that applies in the event of inconsistency between the CEPA and the Northern Ireland protocol.

The noble Lord, Lord Lennie, asked whether changes in accreditation policy would affect Northern Ireland trade. The Secretary of State will consider the UK body’s competence against the partner country’s legislative, regulatory and administrative requirements. In making this judgment, he will of course consider the expert advice of the UK’s national accreditation body. The Trade Act provides for product safety and labour recognition, et cetera, and are they captured, to answer his other question. He noted that there are specifications in the Trade Act, and this SI maintains UK statutory protection. Where the specified regulations relate to protection of human health, human life, animal health or environmental protection, foreign CABs must assess against our existing domestic requirements. This is in accordance with our previous approach to MRAs.

The noble Lord also asked whether the UK could take a different approach to conformity assessments in future. In relation to MRAs, this SI is all about providing continuity for businesses. The UK is able to make its own policy decisions on conformity assessment and accreditation now that we have left the EU. Any future changes would be based on the UK’s best interests, with due consideration, of course, of any impact on the UK’s internal market. The noble Lord asked about the trade and co-operation agreement with the EU. Despite the UK ask, the EU-UK deal did not include an MRA. This is regrettable and will result in an extra cost to trade. As he noted, the UK sought such an agreement, but we were unable to secure it there.

I hope that that answers all noble Lords’ questions on this legislation, and I therefore commend these draft regulations to the Committee.

Motion agreed.