UK hopeful of EU deal on 'Made in Europe' trade rules

Brussels is in the process of updating its trade regulations to favor European producers, a move that has raised concerns in London about potential exclusion of UK businesses. The UK has requested assurances that British producers will not be impacted, but the EU has indicated that such guarantees cannot be provided while the rules are still navigating the bloc's legislative process.

However, the UK believes that its existing Brexit trade agreement, the Trade and Cooperation Agreement (TCA), could serve as a mechanism to compel Brussels to reconsider if a new accord is not reached. Falconer emphasized that the TCA provides significant protections for both parties and that hindering the UK's industrial base would not enhance European competitiveness.

Supporting this view, internal legal advice within the EU Council, according to documents seen by POLITICO, suggests that the proposed Industrial Accelerator Act could potentially contravene the EU's international trade agreements. Falconer indicated that the UK desires a straightforward arrangement where its goods are recognized as originating from the Union under the new act.

Discussions are ongoing, with the upcoming UK-EU summit expected to address several key areas, including agri-foods, youth visas, and emissions trading, and potentially serve as a platform for further negotiations on trade rules. Falconer declined to speculate on whether an agreement on 'Made in Europe' was a prerequisite for success at the summit, citing diplomatic protocol.

Falconer also refuted reports that the EU was demanding the UK increase tariffs on Chinese cars in exchange for guarantees on the 'Made in Europe' rules, stating such conversations were not taking place. A potential compromise might involve a political declaration at the summit, according to EU officials.

In parallel, Prime Minister Andy Burnham has suggested the UK might consider rejoining the EU, or at least its customs union or single market. Falconer confirmed he would be discussing future UK-EU relationship options with European partners during his visit to Strasbourg, where he met with Trade Commissioner Maroš Šefčovič and European Parliament President Roberta Metsola. The European Parliament is reportedly pushing for a stricter stance on the 'Made in Europe' rules.