The coatings industry has cautiously welcomed the new Brexit deal, but expressed significant concerns about border delays and separating from European chemical regulations in the event of a “no deal” or harder Brexit. The British Coatings Federation (BCF), the industry body, recently ran a major survey on its members’ Brexit concerns.
The new Brexit Withdrawal Agreement and political declaration provide some reassurances with its free trade agreement, but BCF warns that regulatory alignment is key for a thriving coatings industry. 82% of BCF members have expressed concerns over new UK chemical regulations, which will be needed in the event the UK does not have access to the European Chemicals Agency.
Other major concerns included the cost and availability of raw materials, and tariff and non-tariff costs relating to additional bureaucracy and administrative costs related to a harder or No Deal Brexit. When asked about longer term impacts, the number one issue was being treated as a third country by ECHA, therefore requiring the UK to have its own duplicate system to register chemicals. Other additional impacts listed were the possibility of reduction of trade with the EU, the UK being a less attractive manufacturing base, and additional costs of doing business.
Over 90% of respondents want to see tariff-free access to the EU market and free movement of goods. 88% of respondents want the UK to stay within EU REACH and the EU regulatory framework, and 83% want to see regulatory equivalence between the UK and the EU for chemicals.
Tom Bowtell, Chief Executive of the British Coatings Federation, said:
“The new Withdrawal Agreement and political declaration go some way towards providing the industry with certainty regarding the UK’s future relationship with the EU. However, our major concerns regarding regulatory alignment going forward are still there.
The UK coatings industry has made significant preparations ahead of a “no deal” Brexit, with 88% of members stating that they have already done some planning in the event of a no deal Brexit. These preparations have taken various forms, with 79% building inventory of raw materials and 60% of respondents discussing contingency plans with logistics suppliers. As the industry body, we have been providing members with updated information regarding UK versions of regulations and plans for procedures at the border. “
Ellen Daniels, Head of Public Affairs and Policy at the British Coatings Federation, said:
“Members are overwhelmingly worried about a “no deal” Brexit, with 95% expressing varying levels of concern. However, we are pleased that the industry has been proactively preparing as much as possible for every eventuality, as 61% say they are somewhat confident that their supply chains can adapt to a no deal Brexit, and 15% are very confident. We will continue to work with members, government and the wider chemicals industry to ensure our members are as prepared as possible in the event of a “no deal” Brexit, which we hope can still be avoided.”