The UK's export licensing authority has published a new Open General Export Licence for the export of dual use goods to the EU which will come into force on 29 March 2019 in event of a no deal Brexit.
UK businesses that hold an existing OGEL and businesses that will require an OGEL after Brexit (i.e. because they are currently exporting dual use goods into the EU) can register now for the new OGEL.
UK publishes no deal export licence for dual use products
On 1 February 2019, the Export Control Joint Unit (("ECJU") - the UK's export licensing authority - published a new Open General Export Licence ("OGEL") for the export of dual use goods to the EU. The OGEL is intended to come into force at 11pm, 29 March in the event that there is no Brexit deal.
"Nothing has changed"?
The OGEL follows the guidance on the export of controlled goods if there is no Brexit deal that was first issued by the Department for International Trade in August. Council Regulation (EC) 428/2009, currently governs the scope of export authorisations (among other things) for dual use goods across the EU, including the UK. This Regulation will be preserved as applying in UK law, as part of the new species of 'Retained EU Law' created by the EU (Withdrawal) Act 2018). As such, the UK's post-Brexit export controls regime will, in the short-term, continue to follow the EU framework.
However, the retention of the EU framework will not prevent a change in the way UK exporters operate. This is because the transfer of goods to the EU from the UK will become an 'export' post-Brexit, triggering the need for export licences in relation to controlled goods.
Exporters of dual use goods - that is, goods that may have both a military and non-military application - will therefore require authorisation in order to export goods into the EU, as well as to the rest of the world.
More importantly, OGELs for the export of dual use goods from the EU will cease to cover the UK in a no deal Brexit. Consequently, exporters will need to obtain a new authorisation from either the UK authorities (if they are exporting from the UK) or the relevant EU Member State (if they are exporting from the EU to the UK).
What if there is a deal?
The Withdrawal Agreement, agreed by the Prime Minister and the EU in November 2018, commits the UK and EU to an 'implementation period' whereby the UK would in effect be treated as an EU member for the purposes of the EU export control regime until 31 December 2020. The relationship between the UK and EU export control regimes after the end of the implementation period is not addressed in the political declaration on the future UK-EU trading relationship. This means there is still uncertainty as to the mutual recognition or otherwise of OGELs from 1 January 2021.
It is still uncertain whether the Withdrawal Agreement will be ratified by the UK Parliament. The publication of the OGEL provides some certainty to business as to the process for exporting dual-use goods from 29 March in the event that the Withdrawal Agreement is not ratified.
What should business do now?
UK businesses that hold an existing OGEL and businesses that will require an OGEL after Brexit (i.e. because they are currently exporting dual use goods into the EU) are able to register to use the new OGEL before it comes into force.
Registration is possible via SPIRE, the ECJU's licensing system. As part of the application process, businesses will need to confirm to the ECJU where records of exports will be retained between now and Brexit day.
For assistance in registration for the new licence, please contact a member of our EU, Trade & Competition team.