Daily Archives: March 26, 2021

A pedestrian passes skyscrapers in the City of London.

Photographer: Jason Alden/Bloomberg

Photographer: Jason Alden/Bloomberg

Britain and the European Union took their first step since Brexit to cooperate on financial services, agreeing on a new forum to discuss market regulation.

The move could help finance firms in the City of London to eventually win back some access to the single market they lost when the U.K. left the EU.

The two sides have agreed a memorandum of understanding on financial services, the U.K. Treasury said in a statement. The content and substance of the deal has been finalized, and the two sides are now working on the formal process of validation.

Technical discussions on the text have now been concluded, the press release says, adding that formal steps need to be undertaken on both sides before the MoU can be signed but it is expected that this can be done expeditiously.

The memorandum sets out a framework for regulatory cooperation and a joint forum for discussing rules and procedures as well as the sharing of information. It is separate from any decision on equivalence, a series of unilateral rulings that each side can make that offer market access to financial services.

The pound rose 0.6% to a session-high $1.3812 immediately after Bloomberg reported the news earlier.

Its a positive for sure, said Jordan Rochester, currency strategist at Nomura International Plc. The market had come to expect further standoffs on financial regulation and the details still need to be sorted out.

Since Brexit took effect at the beginning of 2021, London-based financial firms have been largely unable to operate in the bloc, forcing banks like JPMorgan Chase & Co. and Goldman Sachs Group Inc. to move billions of dollars in assets and thousands of staff to the continent. The trade agreement signed by the two sides last year largely sidelined the finance industry, and the EU has said since that its in no rush to grant equivalence findings that would restore British firms trading rights.

Brussels has fretted that the U.K. is veering from EU standards, taking it further away from equivalent status. The lack of agreement has put Londons decades-long dominance of European finance under threat and left many U.K.-based finance firms that wish to do business inside the EU saddled -- perhaps indefinitely -- with the added complexity and cost of supporting operations in both the U.K. and the bloc.

Read more about Brexits impact on the City of London

While the MOU process is entirely separate to equivalence, some EU officials have said that securing a common framework around certain financial services rules could help unlock some limited equivalence decisions allowing U.K. firms access to the wider EU market.

We know we would want to make progress after the MOU around some issues, Mairead McGuinness, the blocs commissioner for financial services told journalists this month, while warning that divergence would hamper any equivalence rulings.

How Equivalence Holds Key to Post-Brexit Banking

An earlier draft of the agreement seen by Bloomberg says the U.K. Chancellor of the Exchequer and the European Commissions top financial services official should meet twice a year to discuss regulation. It also says the forums activities include:

With assistance by Alex Morales, Greg Ritchie, Silla Brush, and Aoife White

(Updates with U.K. Treasury statement in third and fourth paragraph.)

Before it's here, it's on the Bloomberg Terminal.

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Brexit: UK, EU Reach Post-Brexit Agreement on Financial Regulation - Bloomberg

The UK and EU have already begun to diverge in the way they oversee financial markets as hopes the two will reach a broad agreement on supervisory equivalence in the wake of Brexit fades.

Britain has outlined tweaks to areas including the rules surrounding equity, fixed income and commodities trading just months after the end of the Brexit transition period on December 31.

The subtle rule changes strike at the contrasting philosophies between the EU and UK on how markets should be regulated.

Among the potential changes, the UK plans to scrap caps on the amount of trading done in dark pools, private venues where investors can trade shares without signalling their plans to the rest of the market in advance.

It is also weighing changes to how much information is provided publicly both before and after the completion of trades in the stock and bond market, and to remove limits on the amount of commodities contracts traders can hold.

The EUs priority is to develop a more harmonised internal capital market. By contrast UK politicians view Brexit as the chance to return to restore powers and discretion to regulators and exchanges, lost by layers of detailed and prescriptive EU rulemaking.

UK politicians want to give watchdogs greater leeway to write technical policy; exchanges and trading venues may also have greater freedoms in policing their users and products, according to a Lords Committee reviewing the future of UK-EU relations.

The UK was always an outlier in Europe, said Kay Swinburne, vice-chair of financial services at KPMG and a former member of the European parliament.

Swinburne drew a comparison with the US system: In the US, self-regulatory organisations take on a lot more responsibility rather than relying on the regulator. The EU has never believed a financial market infrastructure is suitable to be self-regulated, she added.

Alignment between Britain and the EU is largely dependent on the EU recognising the UKs standards as equivalent. With the UK looking to diverge, the EU has approved only two temporary permits, which grant UK institutions more direct access to customers in the bloc.

But politicians and business executives attachment to the framework is waning and its value diminishing with every passing week. You cant have divergence and equivalence, said Mairead McGuinness, the EUs financial services chief, on Tuesday.

If youd asked us in the early autumn wed have said that equivalence is vitally important for every area and need to be sorted but things have developed. Equivalence has a short shelf life, said Baroness Rita Donaghy, chair of a House of Lords committee reviewing the future of UK-EU relations.

She urged the UK to strike a close relationship with the EU but admitted: The atmosphere at the moment is rather cool, and that doesnt help.

European rulemaking was often a balancing act between Britain, France and Germany. Now that the UK has departed, the EU is going back to its bank-based system and Britain will have much more flexibilityto adapt its rules than the EU, said Karel Lannoo, chief executive of European think-tank CEPS.

It reminds me of the [wholesale] changes we have gone through the last 30 years. The UK had a diverse, very much self-regulatory system before the single market started, he noted.

Nevertheless, the UKs new system may leave parliament with less ability to scrutinise rules and hold regulators accountable, Baroness Donaghy warned. Government and regulators now hold significant power in setting financial services regulation.

Still, while the UK and EU are likely to go separate ways on important parts of financial rulemaking, there are also areas where they may overlap.

This year both London and Brussels will change unsuccessful parts of the mammoth banking and markets legislation designed to improve the financial system after the 2008 crisis, such as Mifid II, Solvency II for insurers and CRR, which covers bank capital.

The EU may also mimic the UKs plans on failed trades and both are looking at the rules to boost competition in Europes futures markets. The so-called open access regime allows investors to use a clearing house of their choice but they have repeatedly been delayed.

Even then, there may be nuanced but important differences. In a series of quick fixes to Mifid II, Brussels has raised the cap on the amount of commodities contracts traders can hold, to 300,000 lots per trader.

But the UK is looking to go further because its markets, which include Brent crude oil futures, are much bigger and more global, according to three people familiar with the governments thinking.

Under consideration are plans to let exchanges manage traders who hold large positions. The exchange would also decide limits to the size of blocks of trades that are agreed privately, away from the market.

A talking shop, to enhance regulatory co-operation and compatibility between London and Brussels, is expected to be finalised by the end of the month.

But the accord is likely to be rare common ground as each side uses Brexit as a chance to strike out and tailor regulation of major markets like equities, futures and fixed income to their own philosophies. As McGuinness noted on the EUs equivalence decisions: Theres no rush.

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UK and EU begin diverging on financial regulation after Brexit - Financial Times

The UK Government and EU Commission trumpeted their Brexit trade deal, struck at the end of December, as comprehensive, the biggest yet. But a closer inspection of the EU-UK Trade and Cooperation Agreement (TCA) renders these statements largely illusory for the pharma sector. While pharma companies grapple with the effects of Brexit, there are undoubtedly a number of ways that the TCA benefits the sector, while leaving significant issues unanswered. Andrew Shindler takes stock of the deal and considers potential future difficulties.

Surprisingly, although the TCA is voluminous at 1250 pages, it is not comprehensive for most regulated industries. Its main substance claims to cover trade, but the only sectors with specific provisions are transport, fisheries, energy and aviation. Medicinal products are mentioned only in passing. Medical devices do not feature at all.

The most important rule is on trade in goods. This rule applies across all sectors and enshrines the fundamental principle allowing goods that originate in one market to be exported to the other without tax, duty or quota. This applies equally to medicinal products and medical devices as to any other type of goods.

However, given the importance of origin, businesses now need to check their supply chains against detailed origination criteria to determine whether their products or devices qualify as tax and duty-free. As an example, merely repackaging or relabeling goods in the UK which have been imported from a third country, is insufficient.

Even where products do originate in the UK or EU, thus qualifying for tax and duty-free status, this does not mean they can cross the border without friction. The system requires customs formalities, including a statement of origin. Exporters must keep copies of records proving origination for four years and importers must also keep records in most cases.

This general rule on exporting and importing goods free of tax, duty and tariff is significant in enabling the continuing flow of medicines and medical devices between the EU and the UK. However, for the reasons described below, it remains an imperfect solution for the pharma sector.

Intellectual property regimes remain largely parallel

Intellectual property underpins the pharma sector. Fortunately, the UK and EU recognise its importance in the TCA which has a dedicated IP chapter, affirming their commitment to TRIPS. TRIPS maintains minimum standards, such as making patents available for medicinal products and medical devices and a minimum 20 year patent term.

SPCs are preserved in both legal systems by a provision that the EU and UK are required to grant additional periods of protection for medicinal products after patent expiry to recognise the delay in obtaining marketing authorisations (MAs). The IP chapter of the TCA has specific provisions on SPCs and data/market exclusivity. Although, the length of the period is left to the parties to determine, the EU will simply retain its current SPC regulation, which broadly provides a maximum five-year extension, plus an additional six months where there is sufficient paediatric data. Meanwhile, the UK has introduced a parallel system with the same periods, although a UK medicine could end up with a shorter extension because the period starts on the earlier of the EU MA and the UK MA.

The EU and UK must also protect regulatory data submitted to obtain MAs against disclosure to third parties, unless protected against unfair use or there is an overriding public interest in disclosure. The protection extends to rejecting third party regulatory submissions and preventing third parties from marketing products which rely on that data without the applicants consent.

As with SPCs, the period of protection is left to the parties to determine, but both the EU and the UK will maintain the existing 8+2+1 regime.

The Medicinal Products Annex

The TCA mentions medicinal products only fleetingly in its main body, but contains a specific Medicinal Products Annex. Unfortunately, this is thin gruel. Although potentially wide in scope, covering marketed human and veterinary products, advanced therapy products, APIs and investigational products, and with lofty objectives, its only concrete provisions for businesses relate to good manufacturing practice (GMP).

The GMP provisions require the EU and UK to recognise the others manufacturing facility inspections and accept its GMP documents. However, each party can still conduct its own inspections and can suspend recognition in certain circumstances. The parties must notify each other of material change in their GMP requirements and can terminate the mutual recognition arrangements if they consider the others changed requirements inadequate, after further discussion.

The rest of the Annex is confined to high level regulatory cooperation. Even here, the obligation is weak, generally only to endeavour to take the steps described, such as consulting the other on proposals that change its technical regulations and cooperating in promoting internationally agreed scientific and technical guidelines.

The Annex applies only to products, and not to medical devices.

UK medicines are now subject to testing and certification by an EU qualified person on export to the EU on a batch-by-batch basis and a UKCA mark will be required to market medical devices in the UK this will not be recognised in the EU where a CE mark will still be required.

Mind the gap

The sizeable gap in the TCA is the EU and UKs failure to agree on mutual recognition of conformity assessments, approval bodies, product markings or labelling, other than the very limited provisions on GMP.

Mutual recognition which would have involved each party recognising the others certifications as complying with its own standards. Without it, medicinal products and medical devices must be shown to meet the requirements of both separate markets, if they are to be sold there. Pharmaceutical, biotech and medical device companies must therefore now comply with two distinct regulatory regimes, which may diverge increasingly over time, to market their products in both the UK and the EU.

To take two practical examples, which make this process onerous for businesses:

The UK has unilaterally offered transitional provisions that will smooth some imports in the short term. It will continue to accept EU batch-testing until the end of 2022 and CE marked devices until 30 June 2023. These do not apply in reverse. There are also grace periods of up to 12 months, depending on the class, for registering devices for the new UKCA mark.

Further changes on the horizon

The TCA includes a chapter titled Technical Barriers to Trade. Aimed primarily at regulatory cooperation in relation to new standards, this does not solve the problem described above, although it may have a mitigating effect on regulatory divergence.

This chapter also requires the UK and EU to cooperate on market surveillance and product safety, including regular information exchange, co-operative enforcement and coordinated product recalls.

While it is to be hoped that these provisions will limit divergence in standards, the obligations are loose and there is no guarantee that the UK and the EU will follow the same path. Indeed, on 11 February the UK Government passed the Medicines and Medical Devices Act 2021, giving it sweeping powers to amend existing regulations.

For the pharma and device sector, the TCA is a mixed blessing. While its general rule allowing products across the border without tax, duty or quota is of huge importance, the glaring omission of mutual recognition considerably weakens that benefit. Whether the provisions on cooperation will mitigate this weakness or merely serve as a face mask for regulatory divergence remains to be seen.

About the author

Andrew Shindler is partner of Commerce and Technology at Locke Lord (UK) LLP. Andrew has broad experience over thirty years working in the life sciences and other sectors. He specialises in commercial transactions, including licensing and R&D agreements, manufacturing and distribution arrangements, joint ventures and spin outs. Andrew is also an expert on GDPR. He has led award-winning commercial teams, notably Commercial Law Firm of the Year and Corporate Team of the Year Mid Market.

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The Brexit deal; shot in the arm or kick in the teeth for the pharma sector? - - pharmaphorum

Mar 27th 2021

SINCE BECOMING prime minister in July 2019, Boris Johnson has often referred to EU countries as our friends and partners. Many of his fans believed that, once Brexit was done, a more co-operative relationship between the two would be possible. Even those who criticised Mr Johnsons December trade deal for its thinness hoped closer collaboration on issues ranging from the environment to foreign policy would allow Britain and the EU to build on it. Yet three months on, the relationship seems scratchier than ever.

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The year began badly with bigger barriers to trade than many exporters had expected. Covid-19 and stockpiling in the run-up to Brexit make the figures harder to analyse. But in January goods exports to the EU were down by over 40% from December, whereas they rose marginally to non-EU markets. For fish and shellfish, exports fell by a massive 83%; for food and drink, by 75%. Services exports are also likely to have dived.

Covid-19 vaccine wars now cast another shadow. For much of 2020 the story was of Britains slower response than the EUs to the pandemic. This year it has turned into one of British nimbleness in rolling out vaccines, against the EUs woeful sluggishness. Indeed, many Brexiteers trumpet this as proof that they were right to want to leave the bloc.

The government has been careful not to crow over its success with vaccines, and has shown restraint in the face of the EUs vaccine nationalism. Frances Emmanuel Macron cast doubt on the effectiveness of the vaccine produced by AstraZeneca, an Anglo-Swedish firm, and a groundless scare over blood clots, which encouraged vaccine resistance, led many European countries briefly to suspend its use. At the same time, EU leaders complained about AstraZenecas failure to deliver contracted doses. The European Commission is now taking powers to control vaccine exports, including to Britain; though on March 24th, in an attempt to defuse the row, the two sides issued a joint statement saying they were working together to create a win-win situation.

Differences over vaccines may be resolved more easily than those over Northern Ireland. Under the Northern Ireland protocol that is included in Britains withdrawal treaty with the EU, the province remains in effect part of the European single market and customs union. Although Mr Johnson has often denied it, this necessarily entails border and customs controls for goods moving between the province and the rest of the United Kingdom. The resulting obstacles have hindered trade between the two, notably of anything that falls under the regulations covering food, drink and plants, and are threatening the Good Friday Agreement that brought peace to Northern Ireland.

Unionists, including Northern Irelands first minister, Arlene Foster, hate the protocol because the border in the Irish Sea widens the gap between these two parts of the United Kingdom. They want it scrapped. But if the protocol went, a hard border would be needed between north and south to protect the single market. Not only would this be near-impossible to police; it would also antagonise republicans, who would dislike the land border as much as unionists dislike the sea border.

The government remains keen to soften the harshest effects of the protocol. But negotiations in the joint committee supervising it have faltered since Lord Frost, who has replaced Michael Gove as British minister in charge, unilaterally extended grace periods for the application of some controls. The EU has initiated legal action against Britain for this apparent breach of the withdrawal treaty, which follows one first proposed in the internal market bill last September. Lord Frost retorts that the EU itself briefly considered breaching the treaty over vaccine exports in January. With such cavalier behaviour on both sides, trust is in short supply.

One possible solution to the Northern Ireland conundrum would be for Britain to align formally with the EUs veterinary and food-safety standards, thus minimising checks on food, drink and plants travelling between Great Britain and Northern Ireland while helping British exports to the EU. Simon Hoare, Tory chairman of the Commons Northern Ireland committee, claims it would solve 80% of the regulatory problems associated with the protocol, but the government is reluctant, partly because of its instinctive aversion to red tape and partly because it thinks that accepting EU food standards would scupper the chances of a free-trade deal with America. Yet if it does not come up with a solution, a US trade deal is scuppered anyway: President Joe Biden and Congress are clear that any breach of the Northern Ireland protocol would kill it.

Inevitably, in the wake of Brexit, there are other niggles. The European Parliament is deferring its ratification of the December trade deal. Britain is refusing to accord full diplomatic status to the EUs ambassador in London. Still, most Britons want to get on with their big neighbour. A poll this week by Ipsos MORI for the Brussels-based EU-UK forum found 78% of respondents in favour of close relations. However, only 41% expect them. The attitudes of both sides do not give much ground for hope.

The EUs vaccine mess has made it pricklier. That will pass, but one of its main concerns will not: it believes that, if Brexit were seen as a success, it might encourage others to follow suit. That is a reasonable fear; but in Britain, its failure to take into account Northern Irelands particular characteristics looks insensitive.

Mr Johnson takes the view that, in the long term, loosening ties with a chronically slow-growing continent and looking instead across the Atlantic and to Asia is the best way of ensuring Britains future prosperity. In the meantime, keeping a greater distance also makes it easier to blame problems arising from Brexit on European red tape and protectionism. Those wanting a closer relationship across the channel are likely to be disappointed.

Dig deeper

All our stories relating to the pandemic and the vaccines can be found on our coronavirus hub. You can also listen to The Jab, our new podcast on the race between injections and infections, and find trackers showing the global roll-out of vaccines, excess deaths by country and the viruss spread across Europe and America. For more coverage of matters relating specifically to Brexit, visit our Brexit hub.

This article appeared in the Britain section of the print edition under the headline "Cross-channel conflict"

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Hopes of a better post-Brexit relationship with the EU are fading - The Economist

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This article is part of the special report Brexit and the City.

The City of London is an integral part of Britains economic engine: As a global financial services hub, it made up almost 7 percent of Britains economic activity in 2019.

With the U.K.s departure from the EU, effective from January, some have raised alarm bells that this lucrative industry could take a big hit. Already, thousands of U.K.-based jobs and trillions of pounds worth of trades have moved across the Channel.

This shift is largely down to the fact that the U.K. has left the blocs single market and needs special permission to offer financial services to EU companies permission it does not yet have.

But if these losses look dramatic on paper, theyare unlikely to make much of a dent in Londons status as a leader in financial services.

Heres a breakdown of what is changing or not as a result of Brexit.

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Europe's Brexit dividend is a small one - POLITICO.eu

Brexit, the United Kingdoms official exit from the European Union after nearly half a century, has brought new challenges for the biopharmaceutical industry and, for those based in the United Kingdom, the potential for regulatory reforms that enhance their business opportunities, according to Maria Manley, LLM, a London-based partner with Sidley Austin and a widely respected expert on the life sciences.

In an interview with The Center for Biosimilars, Manley discussed the complex regulatory and business restructuring adaptation to the new Brexit landscape, the significance for biosimilars producers, and the British governments goals for this new arrangement.

A lot of pharmaceutical companies had to make significant changes to the way they were operating in the United Kingdom and in the European Union, she said. For example, companies that wanted to continue marketing their products in the European Union had to make sure the corporate entities holding European marketing authorization for products were properly domiciled, so they had to transfer their marketing authorization from the UK entity into an EU entity. Packaging labels had to be changed, too, and clinical trials had to be managed differently, among other changes.

No Tariffs or Quotas

Although it was costly and complicated for the corporate sector, Brexit meant certain advantages also. It led to a free trade agreement with no tariffs and no quotas, and an accord was reached on product certification and good manufacturing practice (GMP) inspection between the United Kingdom and European Union. The acceptance of natural recognition of GMP inspection and certification are obviously very important to the industry because they avoid duplication and extensive cost, she said.

What still represents a problem for companies that do business across national boundaries is the Northern Ireland Protocol, a subsection of Brexit that allowed Northern Ireland, which is part of the United Kingdom, to continue following some EU rules. This affected the movement and border checks of goods from Great Britain into Ireland. Two sets of legislation apply: one to what we call Great Britain [Wales, England, Scotland], and another one to Northern Ireland, and this is a complete nightmare to the industry, Manley said.

Despite the stress and complexity of Brexit, there has been minimal effect on the supply of drugs, and this is partly because the United Kingdom has temporarily acknowledged marketing authorizations previously granted to drugs in the European Union, which makes it possible for continued distribution in the United Kingdom. Affected companies have a period of 1 year to submit the essential [clinical/regulatory] baseline data to the regulatory body, the Health Research Authority, and to establish a presence in the United Kingdom if they didnt have it, and that is until January 2023, Manley said.

Life Sciences Investment

Protecting the interests of the pharmaceutical sector in the United Kingdom was paramount because not only do patients need continuity of quality health care, but the life sciences sector in the United Kingdom employs 260,000 individuals and contributes $41 billion annually to the local economy, Manley said. Having been an essential EU partner for so many years, the United Kingdom needs to make sure that they offer a legal environment that stimulates both innovation and also investment.

There remains close alignment between the UK and EU regulatory systems for biological products, according to Manley. However, the United Kingdom and its Medicines and Healthcare products Regulatory Agency (MHRA) have simplified the legal framework for biologics and biosimilars companies to apply for marketing authorization. In the United Kingdom, the new guidance and legislation make animal toxicology studies unnecessary for biologics developers, as these studies are rarely considered necessary, and comparative clinical efficacy studies will not be required unless there are very good reasons for doing them.

The new approval pathway for biologics is designed around accelerating the progress to market for experimental innovative medicines, and further, the United Kingdom has signaled that regulators would be eager and willing to accept real world evidence in support of regulatory submissions. Thats quite an interesting new pathway, because it also involves other stakeholders who are crucial for having effective market access, which are the payers and other entities we have in the United Kingdom who assess the cost-effectiveness of a product, Manley said.

The "Rolling Review"

Another feature of Britains now-independent medicines approval process is the rolling review that UK regulators employed to do a controversially rapid assessment of the Pfizer/BioNTech COVID-19 vaccine (Comirnaty) in 2020. UK countries became the first in the world to begin vaccinations with Comirnaty, and in defense of the rapid approval process, UK regulators insisted that it never got ahead of the availability of confirmatory data.

Rolling review is meant to reduce the risk of failure at the final stage and to ensure that the application is moving as fast as possible and addressing any potential issue that the regulators may have, Manley said. This review is available for any new active substance, including biosimilars and other biologics.

Also defining the UK system of approvals is the Accelerated Access Collaborative (ACC), which is a multistakeholder partnership (patients, industry, payers, regulators) to speed up patient access to innovative new treatments. This was established prior to Brexit, but the ACC is now the umbrella organization for support of UK health innovation, particularly focusing on medicinal products, including biologics and biosimilars, Manley said.

Although challenging for the United Kingdom, separating its medical products regulation from the European Unions has engendered optimism that systems are in place to spur investment and enable Britain to retain the position of one of the best life sciences platforms in the world, and this involved the United Kingdom listening to what the industry was saying about its difficulties, Manley said.

Theyve been extremely good in realizing that if the market of the European Union was going to be challenging, the rest of the world was available. Were looking toward being more global, trying to avoid duplication, reducing the time for procedures, and making it very attractive to the industry. We also have a pool of technologywhether genomics, artificial intelligence, or first class scientistswhich is there to stimulate this innovation. And obviously, if were successful with this, there would be more drug development investment in the United Kingdom.

A key development that sets the United Kingdom apart from the European Union is the way Britain has responded to an EU stance that the market for medicine is not sufficiently competitive and doesnt fully address the needs of patients for access and affordability. In Europe, fears are rising that pricing and other data disclosure requirements will be broadened and intellectual property rights diminished. The United Kingdom via the trade and cooperation agreement (TCA) established for Brexit has styled itself as a haven from these potential changes.

There is concern by the industry that the market exclusivities for orphan drugs and pediatrics medicines which are currently in place may change and may be reduced by the European Commission in the years to come, while the United Kingdom has made sure, in the negotiation of the TCA, that companies get the possibility to depart from Europe, in the sense that they keep a very high level of protection of those rights, Manley said. The United Kingdom has also confirmed that they want to protect the confidential nature of commercial pricing discussions with companies.

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The Brexit Rollout From the Biosimilars Perspective - The Center for Biosimilars

By James Coombes26/03/2021

It has been three months since the UK left the EU, yet the worrying reality is that thousands of firms are still struggling to adapt to the new requirements for importing and exporting.

And while its encouraging to see that the government has decided to delay checks on imports from the EU, its also further evidence that the impact of Brexit continues to rage on.

There are examples of this disruption on a daily basis. Companies are experiencing long delays at ports while many are seeing perishable goods go to waste. The financial fallout is huge; some businesses face the very real threat of going under. The extra workload and the extra stress caused by the additional requirements is almost certainly harming peoples wellbeing.

Part of the problem here is that those responsible for managing these requirements have largely been left unsupported, on the assumption that eventually they will adjust to the extra processes. This couldnt be further from the truth.

Understanding and actioning customs information alone demands hundreds if not thousands of employee-hours which could otherwise be spent on improving customer service, reducing costs or identifying new areas for growth.

In total, it is estimated businesses will need to process an extra 200 million customs declarations every year, compared with roughly 55 million before Brexit. To put this into context, a seafood exporter now has to fill in 71 pages of documents for just one lorry of fish. These outdated and cumbersome processes are plainly causing significant delays and disruption in our supply chains.

Perhaps most worrying is the fact that this isnt even the full Brexit effect. Further customs requirements will come into force later in the year, requiring any business importing animal products, live animals or plants to wade through even more documentation.

For stressed and overburdened workers throughout the supply chain, this could be the final straw. They are already faced with rising monotonous tasks on a daily basis, and we have heard of business owners who are on the verge of a breakdown due to the sheer volume of paperwork required.

Without some sort of further, extensive trade agreement, this problem of excessive bureaucracy isnt going to go away. And while the most sensible approach would be to work towards the introduction of a global standard for all documents, the reality is that, in the current highly fragmented market, no single party holds the power or permission to dictate a new, singular digital standard.

In the interim, many firms will attempt to hire more people to deal with the increase in processes and procedures easier said than done when the supply chain industry is facing a serious skills shortage. Last year, the government announced its intention to recruit 50,000 customs agents to help process the extra forms. To date, just 10,000 have been recruited.

Were certainly seeing more of our customers looking to recruit people to take on some of the heavy lifting. One of the freight forwarders we work with has been forced to hire 40% more staff since the start of the year. Even if other firms follow suit, its uncertain whether this will be enough to handle the extra restrictions when they come into force.

It is time for a different approach.

We must look to help businesses address the burden of managing customs transactions in a more sustainable, less resource-intensive way. Better technology is needed to handle the processing of paperwork which, quite frankly, remains stuck in the dark ages. The bill of lading, for example, dates as far back as the late 1300s, and yet is still widely used in transporting goods worldwide today. This is in addition to the invoices, air waybills, certificates of origin, packing lists, arrival notices, customs declarations and export health certificates required for processing cross-border transactions.

Businesses cant be expected to just get on with it alone. Its time we acknowledged the archaic processes that still exist in the supply chain and seek out new and creative ways to overcome them. Yes, the new customs processes are vital, but they can be made far easier and stress-free for example, using technology to automate monotonous tasks and, crucially, give organisations powerful intelligence which they can use to improve operations and drive growth.

With the Brexit burden set to increase, and no sign of an extended trade deal on the horizon, this has to be the moment to embrace technology and alleviate the operational burden that sits heavy on the shoulders of our supply chain workers giving them precious time back to actually enjoy their jobs and, quite frankly, put their skills to better use.

This is guest post by James Coombes, chief executive of vector.ai

Mr Coombes is an entrepreneur and trade and commodities finance professional who founded vector.ai in response to the operational challenges in the supply chain, and is helping firms process the mountain of Brexit paperwork.

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Technology is key to cutting through the reels of post-Brexit red tape - theloadstar.com

LARNE, Northern Ireland (Reuters) - The deep anger among some pro-British unionists in Northern Ireland over post-Brexit trade barriers that cut it off from the rest of the United Kingdom is emblazoned along the road from Belfast to the mainly Protestant port town of Larne.

A sign reading 'EU hands off Ulster' is seen affixed to a lamp post in the Port of Larne, Northern Ireland, March 6, 2021. REUTERS/Clodagh Kilcoyne

Posters demanding No Irish Sea Border, Scrap NI Protocol and EU Hands Off Ulster cover much of the 35-km (20-mile) route, their opposition to the new trading arrangements emphasised by the flying of Britains Union Jack flag every few lampposts.

A dispute between Britain and the European Union over the implementation of the so-called Northern Ireland protocol - designed to prevent a hard Irish border - has raised fears that the outrage it has caused among some caught in the middle could spill over into violent protest in the coming months.

The only thing that gets any results in this country is violence or the threat of violence, said Alex, a 72-year-old Larne resident who described himself as a proper unionist. He declined to give his surname.

We are part of the United Kingdom, we were born British, we live British and we will die British.

The British-run region remains deeply split along sectarian lines, 23 years after a peace deal largely ended three decades of bloodshed. Many Catholic nationalists aspire to unification with Ireland while Protestant unionists want to stay in the UK.

Preserving that delicate peace without allowing the United Kingdom a back door into the EUs single market via the border between Northern Ireland and EU-member Ireland was one of the most difficult issues of nearly four years of tortuous talks on the terms of Britains exit from the bloc.

The protocol aimed to solve this by keeping Northern Ireland in both the UKs customs territory and the EUs single market.

However, the subsequent disruption at Northern Irish ports to trade in everyday goods such as cheese originating in Britain since the UK left the EUs orbit on Dec. 31 mean the matter is far from settled.

Unionists say that, in its effort to avoid border checks between Northern Ireland and EU member Ireland and so allay nationalist concerns, the Brexit deal has instead cut them off from the rest of the UK with an effective border in the Irish Sea.

STRENGTH OF FEELING

Many unionists say they feel part of their identity is being erased.

This month, Northern Irish loyalist paramilitary groups - who killed Catholics during the years of violence in what they saw as retaliation for Irish Republican Army (IRA) aggression - said they were temporarily withdrawing support for the 1998 Belfast Agreement, also known as the Good Friday Agreement.

While they pledged peaceful and democratic opposition to the Brexit deal, the groups, which include the outlawed Ulster Volunteer Force, Ulster Defence Association and Red Hand Commando, warned British Prime Minister Boris Johnson in a letter not to underestimate the strength of feeling.

David Campbell, chairman of the Loyalist Communities Council, which represents the views of loyalist paramilitaries, said a Pandoras box of protest and political crisis would be opened unless the EU agreed to significant changes to the deal.

He said unionist anger was running at the highest level since the 1985 Anglo-Irish agreement, which gave Dublin a consultative role in Northern Irish affairs and prompted mass protests and a rise in loyalist violence.

The current leaderships of the loyalist organisations are under extreme pressure from, lets just say, the young Turks who perhaps see an opportunity to go to war on their terms, he told Reuters.

Britain acknowledged the depth of feeling on Friday, when Northern Ireland Secretary Brandon Lewis said unionist disillusionment with the deal could put the province in quite a dangerous place in terms of stability.

The loyalist groups statement needs to be taken seriously, said Billy Hutchinson, a former Ulster Volunteer Force (UVF) prisoner who is now the leader of the Progressive Unionist Party (PUP), a small loyalist political party with links to the UVF.

While Northern Ireland voted 56%-44% to remain in the EU in the 2016 referendum, many unionists, who largely backed Brexit, thought it would enhance their Britishness, according to Hutchinson.

Johnsons government had pledged there would be no new barriers to trade within the UK.

If there hadnt been a pandemic, Im absolutely confident that people would have gone on the streets, said Hutchinson, who served 15 years in prison for the murder of two Catholic half-brothers in the 1970s.

If the political parties on the unionist side dont try to head that off by giving them some sort of hope, some sort of leadership, then you will have violence.

Few believe the region will return to the bombings and tit-for-tat killings of the Troubles, the period that left more than 3,600 people dead. The loyalist groups, though not formally parties to the 1998 accord, endorsed the peace deal and decommissioned their weapons in the years that followed.

However, a repeat of the 2013 protests, when petrol bombs and guns returned to the streets of Belfast after a vote by local councillors to end a century-old tradition of flying Britains flag from City Hall, is seen as a distinct possibility.

Although the unionist anger is aimed mainly at London, outnumbered nationalists in towns such as Larne fear they could be the target if demonstrations turn ugly, according to James McKeown, a local councillor for the largest pro-Irish party, Sinn Fein, formerly the IRAs political ally.

McKeown grew up in Larne but in 1998 his family were told by police to leave after their home was repeatedly shot at and petrol bombed. He moved to nearby Carnlough, a picturesque, mainly Catholic village where the Irish flag flies in the harbour.

Unfortunately in towns like Larne, there is always that element of tension. Has it heightened it? Yes it has, McKeown said. There are a lot of people on both sides of the community apprehensive and fearful about where we could go from here.

Reporting by Padraic Halpin; Editing by Alex Richardson

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Brexit reality stokes fears for the peace in Northern Ireland - Reuters

Nearly three months into the post-Brexit era, over half of UK businesses say they have faced disruption.

According to new polling from YouGov shared exclusively with Sky News, that figure rises to 80% among firms that do a "moderate" or "large" amount of trade with the EU.

The survey of 2,046 businesses found that large organisations were more likely to have been affected than SMEs (small and medium enterprises).

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Three-quarters of all firms that reported having experienced disruption said they expected the impact to last a long time.

The Brexit withdrawal agreement came into force on 1 January.

While it agreed that there would be no tariffs or quotas on goods traded between the EU and the UK, businesses now face customs procedures at the border and safety checks on some goods.

Although the worst predictions of border description have been avoided, firms have had to adjust to new costs and delays, which for some has resulted in a drop-off in orders - all while dealing with the impact of the pandemic.

The survey found that just over half of businesses (52%) had faced disruption, with one in eight (13%) saying it had been a large amount.

A further one in six (17%) say the impact has been moderate, with a fifth reporting a small amount of disturbance (22%).

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The impact was greater among those that do a "moderate" or "large" amount of trade with the EU.

Two in five respondents were in this category - and of this group, 80% said they had faced problems, 72% said the problems were substantial and 60% said they expected the situation to get worse.

Attitudes were mixed among the businesses polled in relation to whether Brexit will affect them negatively overall. While 46% say it would, about a third (36%) say it won't have an impact and 12% believe it will benefit them.

Bearmach is one of many UK businesses that has been affected.

The south Wales-based business exports car parts suitable for Land Rovers to 130 countries around the world, with between 25% to 30% of its business done with the EU-based customers.

"We're about 20% down," director Stuart Truckel explained.

"The EU customers understand now that there is additional cost, but still with the delay of getting the goods they're more nervous about placing orders due to those delays.

"There's an appetite still to buy from us, but there's a nervousness."

"For example, one of our Spanish customers this morning, we've had to chase because he's still waiting for a shipment from the second week of February."

Exports to the EU from Britain have been subject to customs controls since 1 January, but the government has implemented a phased approach on EU imports to give hauliers and businesses more time to adapt.

That introduction of import checks has been delayed a further six months to January 2022, with the government blaming the extra pressure caused by the pandemic.

According to the YouGov research, the COVID-19 is having an impact on more businesses than Brexit.

Seven in ten surveyed (71%) say the pandemic will affect them negatively.

Only one in seven (14%) say it will not have any consequences for their company, while 12% believe it will be beneficial.

Most companies impacted by both the pandemic and Brexit expect that the former will matter in the short-term, while the implications from the latter will be lengthy.

While 47% of those negatively impacted by COVID-19 said they thought it would have a long-term impact, that number rises to 73% for those negatively impacted by Brexit.

"From my experience so far, in the first three months, it does get better day by day," Mr Truckel said.

"Do I think we'll be back to normal in three months' time? No I don't, but I do think we should be close to where we were pre-Brexit by the end of the year."

He added that managing Brexit on top of the pandemic this year has been "very, very stressful".

Speaking on behalf of the government in the House of Commons on Thursday, Penny Mordaunt MP, the paymaster general, said she was sorry to hear businesses are still having difficulties.

But she added: "Frictionless trade would have required regulatory alignment with the EU, which would have undermined our own autonomy in that area and our sovereignty as an independent trading nation.

"That was not a price that we were prepared to pay.

"However, we do recognise that these are ongoing difficulties.

"We will be bringing forward further practical measures to address these issues and to provide business with more support."

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More than half of UK firms have faced disruption due to Brexit, poll finds - Sky News

Having spent almost five years living in Brexit Britain, the tabloids' hostility towards the EU comes as no surprise to me. However, I was surprised to discover the theories surrounding the suspension of the AstraZeneca vaccine, in which European countries are accused of deliberately punishing the UK.

Even pro-European friends sent me messages exasperated at the 'short-sightedness' and 'dirty tactics' of the Europeans, blinded by a hatred of the 'Oxford jab'.

But where did the belief that the suspension of the AstraZeneca vaccine was about Brexit come from?

One explanation highlights the tabloid-constructed narratives which have massive influence over public opinion, where isolated quotes by European officials were used to suit ideological agendas.

One such quote was given by Nicola Magrini, the head of the Italian medicine regulator, in which he describes the suspension as a 'political' choice on the 15 March.

On 16 March, the Daily Mail explained Magrini's comments with reference to an anonymous Conservative MP who claimed that "Brexit sulk" motivated the decision.

One day later, the same quote is used to substantiate the argument that a hypothetical 'Heidelberg' or 'Toulouse' vaccine would not have received the same treatment as the Oxford vaccine.

Finally, on 18 March, Magrini's comments are transformed into "Italy admit[ing] the decision was a political one", reinforcing the narrative of European attacks on the UK as 'smokescreen' to hide their own failings.

The Sun also picked up on Magrini's comments. On the 17 March, the quote was placed directly under a "Brexit Sulk'" subheading with no context and separate from the rest of Magrini's statement.

Immediately after, unrelated comments by the French Europe minister about separate supply issues with AstraZeneca were used to create the false impression that the French government admitted the suspension was both political and Brexit related.

A closer look at the events, however, shows that instead of a conspiracy the decision was old-fashioned bureaucratic caution.

The main protagonist in this narrative is the Paul-Ehrlich Institute, the German independent body in charge of monitoring vaccinations equivalent to the Medical and Heathcare Products Regulatory Agency (MHRA) in the UK.

After identifying blood clots from people who had taken the vaccine, the institute advised the government to suspend AstraZeneca vaccinations until further investigations had been completed, a heavily-criticised move.

Angela Merkel's coalition in Berlin faced a conundrum.

Ignoring the advice would have made them vulnerable to accusations of disregarding their own independent experts as well as lowering trust in the AstraZeneca vaccine further.

On the other hand, suspending vaccinations would slow down an already-mismanaged vaccine rollout and do little to shore up confidence in the safety of the 'Oxford' jab. The latter option was, again, viewed as the more cautious one.

Soon after, Germany's decision to suspend vaccinations was replicated by other European countries.

Importantly, Magrini's comments about "political" choice was a critique of European governments giving in to the pressure from their constituents who were worried about the safety of the AstraZeneca vaccine, not because of a political agenda to punish the UK.

In the end, the Paul Ehrlich institute caused a chain reaction, culminating in an outcome that has hampered European vaccine rollouts.

The implication that the German government cares more about punishing the UK for Brexit than vaccinating its own population is false.

If the Daily Mail and Sun are correct, the German government would have had to pressure its own independent regulators to manufacture fears over blood clots and then use these as an excuse to halt AstraZeneca vaccinations - for a week - to attack the UK.

Furthermore, the supposed benefit of the suspension for Germany is elusive.

Damaging the reputation of a British-Swedish pharma company does little to reduce the evident success the UK has had in vaccinating its population.

Instead, scrutiny of the contrasting vaccination outcomes was actually reinforced by the suspension.

Meanwhile, the downside of the move is obvious. Pressuring an independent regulator would risk a much greater political scandal than any MP corruption affair currently embroiling the CDU.

Slow vaccine rollouts have seriously harmed the German government in the polls and the AstraZeneca suspension has certainly not helped.

Is it plausible that the German government is so obsessed with harming the UK that it plunged its own vaccination rollout into chaos?

The alternative explanation - an overly cautious regulator putting the government in a difficult position - is much less exciting, but much more likely.

The British tabloids' obsession with framing every relevant decision made in the EU as a hostile act to constrain the UK's post-Brexit ascendancy hurts UK-EU relations.

With the end of the Brexit negotiations, those who value good relations need to continue challenging the same false narratives - peddled for ideological reasons - which caused the Brexit mess to begin with.

Just because Brexit has happened does not make them any less damaging.

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Brexit, tabloid 'sulks', and AstraZeneca - EUobserver