The Trade and Cooperation Agreement (TCA): What You Need to Know
The Trade and Cooperation Agreement (TCA) is a comprehensive trade agreement between the United Kingdom (UK) and the European Union (EU). It was signed on December 24, 2020, and came into effect on January 1, 2021, following the end of the Brexit transition period.
The TCA covers a wide range of topics, from trade in goods and services to fisheries and transport. Here are some of the key points to keep in mind:
Trade in Goods
Under the TCA, there are no tariffs or quotas on goods traded between the UK and the EU. However, there are rules of origin requirements, which means that goods must be made mostly in the UK or EU to qualify for tariff-free trade.
There are also new customs procedures and border controls in place, which have led to some disruption at ports on both sides of the English Channel. Businesses should be prepared for the additional paperwork and administrative burdens that come with trading with the EU.
Trade in Services
The TCA does not provide the same level of market access for services as it does for goods. In particular, there are limitations on the ability of UK service providers to operate in the EU, and vice versa.
However, the TCA does provide for some cooperation on regulatory issues, which should help to reduce barriers to trade in services over time. It also includes provisions on digital trade, which is becoming increasingly important in the modern economy.
The TCA includes a framework for the management of fisheries in UK and EU waters. Under the agreement, the UK will gradually regain control of its fishing waters over a five-and-a-half-year period, with quotas for EU fishing fleets being gradually reduced.
The TCA provides for continued air, road, and rail connectivity between the UK and the EU. However, there are new requirements for drivers and hauliers, which may lead to delays and additional costs.
The Trade and Cooperation Agreement (TCA) is a significant milestone in the UK`s relationship with the EU. While it provides for tariff-free trade in goods, there are new customs procedures and border controls to navigate, which have led to some disruption. Businesses should be aware of the additional paperwork and administrative burdens that come with trading with the EU and be prepared to adapt to the new trading environment.