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Brexit and the Equine Sector

31/01/17
Brexit and the Equine Sector
Brexit and the Equine Sector

This month, the UK’s Prime Minister made her much anticipated speech on the UK’s exit from the EU, and finally spelt out what ‘Brexit means Brexit’ means for her government:

• Britain will leave the Single Market and seek the greatest possible access with a fully-reciprocal free trade deal with the EU

• If a UK arrangement with the EU Customs Union cannot also allow UK trade deals with other countries, then the UK will not associate with the EU Customs Union

• Seek a mutual guarantee of the rights of EU nationals in Britain, and Britons living in Europe, as soon as possible          

• Have a phased process of implementation of new arrangements outside the EU from 2019

• Most of the body of existing EU law will be converted into British law to give maximum certainty

• Ireland will have a common travel area between UK and Irish republic while protecting the integrity of the UK’s immigration system
                     
Whilst all of these measures had been implied in previous announcements from the UK Government over recent months, by making them explicit in her speech, May has provided clarity and enabled forward planning for organisations across the UK, EU and beyond.

Brexit will have, and is already having, far reaching consequences for all sectors, and PLMR’s Brexit Unit, in collaboration with Ireland’s Transatlantic Public Affairs, is pleased to provide the following analysis of key implications on the UK’s equine sector.

Trade

Leaving the Single Market, and quite possibly the EU’s Customs Union, means the UK’s trading relationships are most likely to be conducted under default tariffs of the World Trade Organisation (WTO). These tariffs, which may be adjusted in line with respective country’s trade levels, can apply to horses and equine-derived products, as well as feed and other equine related products.

There are no WTO tariffs on ‘pure-bred breeding animals’, so for these horses, tariffs should not be an issue. However, for racing or sporting animals that are geldings, or crossbreds, it is possible that the standard WTO tariff of up to 11.5% will apply, as will other rates to equine-derived products, feed and other equine-related products.

The terms of any UK-EU reciprocal free trade deal, and other international deals, will be very important. Here, it would appear that as the balance of live equine trade is in the EU’s favour, and those countries will want a deal with the UK. Perhaps more importantly, over recent years, tariff levels, especially for non-agricultural produce, have fallen and non-tariff barriers have become more important. Some of these are examined below.

Movement of Horses

The current straightforward requirements for the movement of horses within the EU will no longer automatically include the UK. Transport between the EU and the UK may be restricted to a relatively limited set of designated Border Inspection Posts. For example, Dublin is the only such sea route in Ireland, and this includes for horse, equine semen, ova and embryos.

Inspections and health certification is the default requirement for third country animal movements into the EU, and so could be re-introduced around equine movement where the UK is concerned.

The best hope for a relatively seamless transition on the movement of horses between the post-Brexit UK and the EU would be for the EU and UK to agree their mutual interest in the UK’s existing identical rules remaining “equivalent” to the same EU regime.

Identification, Animal Health and Breeding Legislation

With most existing EU law being converted into British law, the current equine identification, animal health and breeding legislation will remain in place. The UK will adopt the new EU identification and breeding regulations, which it must do since these will be in force before the UK leaves the EU, and this gives short to medium term certainty. Much more uncertain is the implications of the total review of all EU Animal Health laws now underway and due for implementation in 2021 - after the UK has left the EU. These laws cover significant areas such as disease control, animal movement control, and animal identification.

Again, given the current balance of trade in live animals, there is mutual interest in UK’s existing identical rules remaining “equivalent” to the same EU regime. However if, over time, the UK develops free trade agreements with countries outside the EU, it may be that the complete adoption of EU Animal Health laws no longer suits the UK. For example, a simpler approach for horse identification may emerge, reducing the burden for individual owners but still supporting the needs of racing, breeding and competition.

Equine Welfare

Most equine welfare legislation in the UK is implemented via the domestic Animal Welfare Act. Key exceptions are welfare in transport and slaughterhouse rules, which will certainly not be diluted, and will be transposed from EU into UK law.  Given the different perspective of some EU states, where the horse is an agricultural and even food animal, this is an area where divergence is quite possible over the longer term.

Ireland

There is a special relationship between the UK and Ireland with regard to horses, equine products and equine professionals. As for trade overall, and the agricultural sector more specifically, the balance of trade and movement of people is in Ireland’s favour. This balance, and the maintenance of a common travel area between the UK and Irish republic, should help retain much of the status quo, but the UK must realise that Ireland will be looking over the UK to the EU to a far greater extent than before. In the meantime, the UK should be considering a modern UK-Irish relationship that benefits both states – Ireland will be very important to the UK as an English-speaking interlocutor with the EU.

Common Agricultural Policy

British withdrawal from the EU will end its participation in the Common Agricultural Policy (CAP). There is relatively small proportion of horse breeders in the UK who currently benefit from the CAP. Nonetheless, they are at risk of losing that support, and their focus should be on emphasising the importance of their acreage of untilled permanent grassland as part of the rural environment.

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