UK-EU Customs Union

Lord Elliott of Mickle Fell Excerpts

Thursday 29th January 2026 Lords Chamber

[Lord Elliott of Mickle Fell (Con)]

My Lords, we have had four excellent maiden speeches today, and this is my first speech on Britain’s relationship with the European Union, so I should begin by declaring an interest—my previous position as chief executive of the Vote Leave campaign, and therefore perhaps as the person most responsible in the Chamber today for our having this debate.

I am reminded about my role in Brexit every time I walk into Parliament. Behind the security post inside Peers Entrance is a copy of my 1,032-page book on the subject, Change, or Go, which I co-authored with my noble friend Lord Moynihan of Chelsea, in 2015. Other copies on the Parliamentary Estate can be found propping up computer monitors, or even literally being used as doorstops. On the subject of today’s debate, Change, or Go included a long section on what was referred to in those days as the Turkish option—membership of the EU’s customs union. After briefly touching on trade, I would like to highlight the regulatory implications of Britain joining a UK-EU customs union for tech and the life sciences.

On trade policy, it is clear that the Government would need to abandon the trade deals they have negotiated. Speaking in Davos last week, the Chancellor said:

“We can’t go back in time and since we’ve left the EU we have done trade deals with India, with the US, with South Korea, and obviously you would lose the benefit of some of those trade deals if you were to re-enter a customs union”.


Unlike some of the speakers on the Labour Benches, I agree with Rachel Reeves. We should keep control of our trade policy.

Secondly, there is the regulatory impact on our thriving tech and AI sector—the largest in Europe—which is worth some $1.2 trillion. As the economist Douglas McWilliams, author of The Flat White Economy, said:

“We have the most successful tech sector in Europe. The reason why is we are outside the Digital Markets Act, the Digital Services Act, and the AI Act, which are three European acts which heavily constrain tech growth in the EU”.


The Prime Minister agrees with this point. When he launched the Government’s AI opportunities action plan, Keir Starmer said:

“I know there are different approaches around the world. But we are now in control of our regulatory regime … so we will go our own way on this.”


Were we to join a customs union and have a deal similar to Turkey’s, we would not be allowed to do that. Article 9 and the second clause of Article 54 would prevent us going our own way on tech and AI.

Finally, there is the impact this would have on our world-leading life sciences sector. The head of the MHRA told the “Today” programme recently that clinical trial applications rose by 9% last year. Inside a UK-EU customs union we would lose the benefits of the international recognition procedure, which enables it to take advantage of approvals by their equivalents in Switzerland, Japan, Canada and Australia. We would also have to row back on the landmark pharmaceuticals deal with the US, which the Government achieved just last December. This success is a direct result of regulatory decisions we have made since Brexit. Why would we chase away world-leading trials and potentially harm the most vulnerable patients in society? There are many other areas of government policy that I could have spoken about: education, farming and housebuilding, to name just three.

What the noble Lord, Lord Newby, is proposing, would open up a regulatory Pandora’s box on a plethora of policy areas that the Government would be wise to avoid. Unless those advocating a UK-EU customs union outline what it would mean for all the many issues raised in today’s debate, it will be clear to this House and to the public that they simply do not have a credible plan.