Protectionism: Export restrictions hit EU manufacturers

Aside from the export of sensitive (military / dual use) goods, manufacturers have faced very few hurdles to export products out of the European Union (EU). However, the EU looks to be one of the first major economies to adopt trade measures to stem sales of products to overseas customers in the interest of the protection of public health during the COVID-19 crisis.

With effect from 15 March 2020, the export of Personal Protective Equipment, which covers equipment such as masks, protective spectacles and visors, face shields, mouth-nose protection and protective garments, will be subject to obtaining an authorisation from the EU Member State of export. The initial restriction is set to last for six weeks but this could be extended by the European Commission with relative ease. We understand that the UK will be treated as a Member State for the purposes of the export restrictions and will therefore not be treated as a third country for export purposes. The European Commission is providing support to Member States to adopt a process for establishing processes to enable authorisation application and review.

Article XX of the World Trade Organization's General Agreement on Tariffs and Trade, to which the EU is a signatory on behalf of the Member States, allows for deviation from the rules and principles of non-discriminatory measures against third countries and/ or restriction of free trade in a number of exceptional circumstances. These circumstances include the protection of human health.

UK and EU exporters should consider what further export restrictions may be introduced in the coming weeks. Measures could foreseeably extend to medical equipment, consumer healthcare products and food. Therefore supply chain planning and reviewing agreements with non EU customers is vital to understand the risk landscape.

Download a copy of the EU Commission Regulation discussed above.