Yesterday morning, the WSTA (Wine and Spirits Trade Association) and Liv-ex hosted a webinar on Post-Brexit trading for fine wine merchants.
The webinar gave an update on the current situation in the context of Covid-19 and explained what will change on the 1st January 2021. It also explained what members of the trade can do to prepare and how together we can make trading easier.
What will change on the 1st January 2021?
As it stands the UK Government is planning to impose anti-competitive and highly protectionist rules that do not serve the interests of the UK wine trade or consumers. The rules rolled over from EU law will impose the same restrictions on the UK trade that the EU imposes on third party countries.
These rules are designed to protect the interests of wine producers in the EU. They will do nothing to advance the UK’s position as the leading hub in the global wine trade and will increase prices and limit choice for UK consumers.
Some of the key changes wine businesses will face come January include:
- Wine import certificates (VI-1s), which require laboratory analysis for every wine entering the UK
- New labelling requirements. All bottles will need to be labelled with the UK importer’s address
- A highly complex tariff schedule, which will raise minimal income but impose significant costs on wine businesses to administer
These new rules are not being imposed on us by the EU, but by the UK Government.
The VI-1 form for example, would be particularly costly. The WSTA estimates that it will cost the industry £70m, with each individual form costing £330, and much more in lost revenue.
For more details on VI-1 forms and the WSTAs concerns, click here. WSTA members can find further information on their website here.
What are we doing to make trading easier Post-Brexit?
The WSTA has an ambitious proposal for the UK Government that we believe will remove these barriers to trade and expand the UK’s position as the world’s global hub for wine. Details of the proposal include:
- Zero tariffs on all wine imports, to reduce complexity around trading wine
- Minimal complexity in import/export requirements, including the abolition of the VI-1 import certification for wine
- Joining the World Wine Trade Group as soon as possible to promote mutual recognition as a platform for future free trade with the rest of the world
- Digital compliance with all regulations, for example online duty payments
- Support to promote our world-leading wine trade in global markets
These proposals are all possible with or without a deal with the EU. Our departure from the EU presents an opportunity for the UK to arrange its trading arrangements in a way that suits us and increases our trade. But to do this, we need your help.
What you can do to help the UK wine trade secure the best possible outcome?
- Sign up to the WSTA
The WSTA have already opened communication channels with the UK Government. They will help get our points across to the government and give us an understanding of the laws that we don’t already have. Simply put, without the WSTA’s help, UK merchants will not be ready come January, whatever the outcome. For more details, click here.
- Write to your local MP
We urge all Liv-ex members to write to Ministers and their MPs. Liv-ex’s James Miles has already written to Victoria Prentis at DEFRA (Department for Environment, Food and Rural Affairs). You can read a copy of his letter here. Anyone wishing to write their own letter, can find a template on the WSTA website here. If you are unsure who your MP is, you can check via the UK Parliament website, here.
It is important that we come together as a trade and work with our trade body – the WSTA – to ensure that we exit the transition period on the best possible terms.
We would also like to take this opportunity to assure Liv-ex members that we are working hard to ensure that whatever the outcome, fine wine trading on the exchange can continue with minimal disruption. We will be sharing more details on this in the coming months.
Liv-ex is the global marketplace for the wine trade, with over 475 members worldwide. We offer business services that span trading, data, fulfilment and automation technology to a diverse group of wine businesses – from ambitious start-ups to established merchants.
With our members’ help, Liv-ex continues to obsess about making the wine market more transparent, efficient and safe and removing barriers to trade.
For further details on the work Liv-ex is doing behind the scenes, Liv-ex members can contact their Account Managers.
For more information on yesterday’s webinar, please contact Jessica Parker ([email protected]).
