Product Safety and Metrology etc. (Amendment etc.) (UK (NI) Indication) (EU Exit) Regulations 2020

Lord Callanan Excerpts

Friday 27th November 2020 Lords Chamber

Moved by

[Lord Callanan]

That the draft Regulations laid before the House on 13 October be approved.

Relevant document: 32nd Report from the Secondary Legislation Scrutiny Committee (special attention drawn to the instrument)

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

My Lords, this SI is one of a series of SIs that amend the previously laid 2019 regulations. Those original regulations, the Product Safety and Metrology etc. (Amendment etc.) (EU Exit) Regulations 2019, were drafted in the event that a deal was not agreed and will need to be amended before coming into force at the end of the transition period.

The SI we are debating today is needed to take account of the withdrawal agreement, in particular the requirements of the Northern Ireland protocol. This amending instrument—the sixth in the series—will do a number of things to complete the picture on how goods from the EU and from Northern Ireland will be treated on the market in Great Britain and provide businesses with certainty about these arrangements.

The aim of the original product safety and metrology EU exit regulations 2019 was to bring the existing EU system of essential requirements, standards and conformity assessment into our domestic law. It made some changes that are needed by virtue of the UK leaving the EU—regardless of any deal—while retaining the fundamental elements of the product safety and metrology regulatory regime.

As I am sure noble Lords will recognise, the UK product safety and legal metrology system is among the strongest in the world. Alongside the original EU exit regulation, which left that framework largely unchanged, this amending SI will ensure that we continue to have a robust product safety framework in place to prevent unsafe and non-compliant products, whether that is toys, cosmetics, lifts or machinery, entering the UK market. Specifically, this SI will allow for continued acceptance of CE-marked goods into the market of Great Britain for 12 months, before making the new UKCA mark mandatory from January 2022. It will introduce a number of transitional arrangements to help minimise costs to economic operators and give them time to prepare. It will provide for unfettered access for Northern Ireland to the rest of the United Kingdom, and introduce and implement the UKNI marking for certain goods on the Northern Ireland market.

By making these amendments, this SI will ensure that the UK is able to provide continued robust protection to UK consumers, giving confidence that only safe and compliant products can be placed on the market, maintaining a robust product safety and legal metrology framework from the end of the transition period. There will, of course, be interest in what the new UK regulatory regime will look like going forward. This SI does not set out what that future regime will look like; it sets out the building blocks that will be a matter for future consultation and future legislation. On this matter, I will simply say that the Government are committed to ensuring that consumers are protected from unsafe products and we will look to deliver a future product safety regime that is simple, flexible and fit for the opportunities ahead of us.

What does this SI do? It does a number of things to complete the picture of how goods from the EU and from Northern Ireland will be treated on the market in Great Britain, as follows. It provides greater legal certainty about the date by which companies need to comply with new regulatory requirements for the market in Great Britain, specifying that the new UKCA marking will become mandatory from the start of 2022. It amends domestic legislation to take account of the withdrawal agreement, implementing the Northern Ireland protocol with respect to product safety and legal metrology. On the protocol, this SI provides for unfettered access to the rest of the United Kingdom market for qualifying Northern Ireland goods, subject to product safety and metrology legislation.

This SI will introduce and implement the UKNI marking, which will accompany the CE marking for certain goods when placed on the market in Northern Ireland. This includes the introduction of an appropriate set of sanctions should the UKNI marking be missing or misused, in line with the penalties that apply when other product safety rules are broken. I shall address each of these areas in more detail, starting with the GB regulatory arrangements.

In respect of amending domestic legislation, this SI will ensure that provisions in previous EU exit legislation are updated to reflect the Government’s approach to phasing in new GB regulatory requirements. The previous product safety EU exit SI introduced a domestic regulatory regime, with the UKCA marking replacing EU conformity markings, including the CE marking, alongside a system of UK approved bodies to replace EU notified bodies. That system will come into force at the end of the transition period. This original SI also set out that goods meeting the EU’s requirements, including the CE marking, could still be accepted in Great Britain, in order to give businesses time to prepare. However, the original SI did not put a specific end date on how long the CE and other conformity markings could continue to be accepted. Now that we have greater certainty, due to the withdrawal agreement and the end date for the transition period, this amending SI now introduces a 12-month end point for goods in scope of this instrument.

We now have a clear date for independently approving goods for sale in our market, rather than relying on the EU. We believe that this will give businesses clarity on when they should be ready for the new regime. However, we do appreciate that business will still need time to prepare, so we have also gone further than the original SI by increasing the number of easements for businesses. This includes offering the option to affix the UKCA marking on to products using labels, or on accompanying documentation, rather than on to each individual product. This will be allowed from the end of the transition period for 24 months and will help to reduce costs to businesses for retrospectively changing their marking and labelling mid-production. It will also allow new UK importers of products into Great Britain—those from the EEA and Switzerland—to place their contact details on accompanying documents, again for a period of 24 months from the end of the transition period—which is an increase on the 18 months’ timeframe established in the original SI. This measure will give businesses more time to implement the labelling requirements for the GB regime, again saving them time and money.

This SI will also ensure that all GB authorised representatives must be based in the United Kingdom from the end of the transition period, helping to ensure that any legal entity that has been authorised to act on behalf of the manufacturer can be held accountable here in the UK.

Turning to the issue of unfettered access, the Government committed to legislating by 1 January 2021 to guarantee unfettered access for qualifying Northern Ireland goods to the rest of the United Kingdom market. That commitment is intended to be delivered through both primary and secondary legislation, with the Government having already laid a draft affirmative SI to define qualifying Northern Ireland goods. This SI references that definition in order to implement unfettered access provisions with respect to product safety and legal metrology. The changes made by this SI will be interdependent with other required protocol work—for example, to establish a Northern Ireland-facing product safety and legal metrology system. This SI must be in place to ensure all aspects work coherently from day one.

Finally, I turn to the UKNI marking, which noble Lords will find as an illustration in Schedule 1 to the instrument. This SI makes provisions in respect of two aspects of the UKNI marking: its introduction and the implementation of the product marking requirements in respect of the Northern Ireland protocol. It sets out the design of the marking and implements the approach to sanctions should the marking be missing or misused.

The UKNI marking will be used alongside the CE marking to indicate that a UK-based conformity assessment body has undertaken third-party testing against EU requirements and approved it for placing on the Northern Ireland market. This will also mean that such products cannot be put on the market in the EU. This is a vital part of the operation of the protocol. Not proceeding with this legislation would mean not fully implementing the protocol, causing businesses uncertainty about the UKNI marking and what exactly they must do to comply after the end of the transition period.

In conclusion, this SI will retain a regulatory framework that business is familiar with, alongside delivering important updated elements of the product safety and legal metrology regime in both Great Britain and Northern Ireland to implement the requirements in the withdrawal agreement of the Northern Ireland protocol. I can reassure noble Lords that we have engaged with Northern Ireland colleagues on the changes this SI makes and ensured that they have been kept fully informed of its progress. It ensures that provisions in previous EU exit legislation are updated to reflect this Government’s approach to allowing goods in the scope of this SI to continue to be accepted on to the Great Britain market, having followed EU rules for 12 months after the end of the transition period, and it forms part of the legislation to deliver unfettered access for qualifying Northern Ireland goods to the rest of the UK market.

The safety of individuals, families and communities is a top priority for the Government. As I am sure noble Lords will recognise, it is essential that the UK continue to have a robust product safety framework in place to protect consumers and prevent unsafe and non-compliant products entering the UK market. I therefore commend these regulations to the House.

--- Later in debate ---

[Lord Callanan (Con)]

My Lords, I thank all noble Lords for their valuable contributions to this debate on what is a complicated issue, as a number of noble Lords have accepted. I have set out today the importance of this SI for completing the picture on how goods from the EU and from Northern Ireland will be treated on the market in Great Britain. This will provide businesses with certainty about the arrangements in place at the end of the transition period, and easements to give them some more time to prepare. It will do so in the following ways.

It will allow for the continued acceptance of CE marked goods in the scope of this SI on the market of Great Britain for 12 months after the transition period, before making the new UKCA mark mandatory from January 2022. It will introduce transitional arrangements to help minimise costs to economic operators arising from any uncertainty and give them time to prepare by clarifying the obligations they are required to comply with at the end of the transition period. It will provide unfettered access for Northern Ireland to the rest of the UK, which means no new regulatory checks or additional approvals for Northern Ireland businesses to place qualifying Northern Ireland goods on the Great Britain market. It will also, by setting out the rules in relation to the UK(NI) marking, provide clarity for businesses wishing to supply products to the Northern Ireland market that use UK-based conformity assessment bodies.

Along with the business easements that this SI introduces, a number of other steps have been taken to help businesses get ready for the end of the transition period. These include the rollout of an ambitious series of events, including sector-specific webinars and business adviser training sessions, giving the most up-to-date information on general readiness actions to be taken. The Office for Product Safety & Standards has also published a suite of sector guides, explaining product by product the changes made and how businesses need to comply.

In supporting this SI, we will ensure that the UK is able to continue to provide robust protection to consumers, ensuring that only safe and compliant products can be placed on the market. Without it, we risk disruption and confusion for businesses and enforcement authorities.

Turning to some of the specific questions that were raised, I can reassure my noble friend Lord Moylan that I was not involved in the design of the UKNI logo—which is probably to everybody’s benefit. However, it is intended to be easy to print and to read, and I can assure my noble friend that we discussed the design extensively with a range of manufacturers to ensure that they can apply it if they need to. It was delivered in close consultation with businesses, which rejected a number of alternative options that were put to them.

I can assure my noble friend Lady McIntosh, the noble Baroness, Lady Bakewell, and the noble Lord, Lord Foulkes, that we have engaged extensively with businesses on these regulations. We held informal discussions with over 4,000 businesses, including manufacturers, trade associations and industry representatives, by means of a series of structured interviews.

A number of noble Lords, including the noble Lords, Lord Dodds and Lord Empey, raised the issue of the Northern Ireland protocol and unfettered access. This instrument deals with unfettered access arrangements for certain manufactured goods such as toys and gas appliances. Together with other statutory instruments, as well as the UK Internal Market Bill, this instrument will guarantee unfettered access for qualifying Northern Ireland goods to the rest of the UK market. Highly regulated goods, including cosmetics, which can pose a more serious risk to consumers and the environment, will be subject to some minor transparency requirements that ensure that the GB regulator has the necessary information to protect UK consumers and the environment.

The noble Baroness, Lady Ritchie, and the noble Lord, Lord Dodds, also raised the issue of whether products tested in Great Britain can be sold in Northern Ireland. The UK Government are clear that, as set out in the text of the protocol, Article 7 allows for assessments, registrations, certificates, approvals and authorisations issued or carried out by the competent authorities in the United Kingdom or by bodies established in the United Kingdom to be valid in Northern Ireland. The EU’s technical notice on industrial goods states that only bodies in Northern Ireland carry out this activity. Let us be clear that we do not agree with this interpretation.

My noble friends Lord Lilley and Lady McIntosh, and the noble Baroness, Lady Bakewell, raised the issue of recognition. Obviously, the final free trade agreement is not yet agreed, but we have proposed a comprehensive mutual recognition agreement with the EU to recognise each other’s conformity assessment test results, which would mean that UK testing houses could test against EU rules and affix the relevant CE mark, although this is still a matter for negotiation. However, as I said, the UK Government are clear that, as set out in the text of the protocol, Article 7 allows for assessments, registrations, certificates, approvals and authorisations issued or carried out by the competent authorities of the UK or by bodies established in the UK to be valid in Northern Ireland.

The noble Lord, Lord Foulkes, showed a worrying interest in the subject of pyrotechnics, which should be extremely alarming for those of us on the Government Front Bench. I can tell him that we have allowed approved bodies on pyrotechnics to be based outside the UK from 1 January 2021 because, as the noble Baroness, Lady Bakewell, pointed out, currently there is no UK-approved body in the UK. It should be noted that any approved body requirements need to be approved by the Secretary of State.

My noble friend Lady McIntosh addressed the impact assessment. I can tell her that the withdrawal agreement Act sets out an impact assessment on the provisions governing the UK’s exit from the EU, including the terms of the Northern Ireland protocol. This SI is the detailed implementation of that policy, which has already been assessed by that impact assessment, so no new burdens need to be assessed.

In response to the question from the noble Baroness, Lady Ritchie, about UKNI indication and misuse penalties, the UK has high levels of product safety to protect the public from potentially dangerous products. When our market surveillance authorities find that a business has misused a product conformity marking, such as the UKNI, our starting position will be to help businesses to understand and comply with the rules, unless it is a particularly serious breach of product safety. There will usually be a period of time for the business to correct the non-compliance before we take any action.

The noble Baronesses, Lady Bennett and Lady McIntosh, raised the subject of business readiness. Further guidance has since been published and more than 3,000 people have attended government webinars to help them to get ready for the end of the transition period, with 86% of those polled saying that they would take action to prepare their business as a direct result of these sessions. A second phase of webinars is running throughout November and December, covering key issues that could affect businesses in multiple sectors, including personal data and regulations on manufactured goods.

Coming back to the impact assessment, we have assessed the changes related to setting out the time limits to end recognition of the CE mark as below the de minimis threshold of £5 million per annum; an impact assessment is therefore not required, according to the Government’s better regulation framework. I say that to the noble Baroness, Lady McIntosh, and the noble Lord, Lord Bassam.

The noble Lord, Lord Empey, raised the subject of unfettered access if standards diverge between Great Britain and Northern Ireland. Under unfettered access qualifying, Northern Ireland goods can be placed on the Great Britain market without the need for further approvals. This means that goods that are valid on the Northern Ireland market will be valid on the market in the rest of the UK. We have been clear that unfettered access will not cover goods travelling directly from Ireland or the rest of the EU being imported into Great Britain. Northern Ireland businesses will need to label goods that are placed on the market in the rest of the UK with their own contact details, in common with UK businesses placing goods from outside the UK on the GB market.

I am running out of time. I have a number of other queries to respond to so I will be happy to write to noble Lords, with my apologies. With those comments, I commend these regulations to the House.

Motion agreed.