A no deal Brexit would mean UK wine businesses have to ‘jump through hoops to import wine into the UK’ thanks to the introduction of new forms and laboratory test demands, says the Wine and Spirit Trade Association (WSTA).
Miles Beale, Chief Executive, WSTA, said: “The reality is that if we leave the EU without a deal wine businesses, big and small, will be facing a catalogue of extra costs which will ultimately be passed onto the British consumer.”
Red tape warning
The UK is set to leave the EU on March 29. If a deal is reached, this will put mechanisms in place for a transition period. Without a deal, however, the UK will ‘crash out’ of the EU.
Pressure is mounting on the government to set out a clear path forward. Prime Minister Theresa May's Brexit deal was rejected by MPs last month; and MPs are due to vote on a revised deal on March 12.
The WSTA has been campaigning for the government to find a deal, and its ‘Don’t bottle it’ campaign has already highlighted the threats from a no-deal scenario - such as the uncertainty created for business, issues over cash flow, staff shortages and delays of products at the border.
It has now written to members of parliament Michael Gove, Liam Fox and Philip Hammond to highlight mounting costs facing the UK wine industry, particularly with regards to the potential of extra red tape from a no deal Brexit.
The WSTA says that the combination of additional forms, wine duty hikes, wine tariffs and rising inflation will likely mean a rise in price for consumers.
'Real blow to exporters and importers alike'
Around 55% of the wine drunk in the UK is imported from Europe. The industry is largely made up of small winemakers and independent merchants, which feel the pressure of extra paperwork more acutely.
Wine entering the EU must be accompanied by a VI-1 form. If Britain leaves the EU without a deal, an estimated 500,000 new VI-1 forms - all accompanied by a lab test - will be required for wine that enters the UK from Europe.
Wine from the UK which is destined for the EU will also have to use a VI-1 form, adding around 150,000 forms.
It costs in the region of £20 for each two-page document, which has to be filled out by hand.
“The additional form filling and laboratory tests required for a no deal scenario will come as a real blow to exporters and importers alike. Wine inspectors will find themselves drowning in paperwork and - unless they can double their workforce - wine consignments are going to be held up by unnecessary additional red tape".
Miles Beale, WSTA.
In addition, wine inspectors will feel the pressure of the extra paperwork, argues the WSTA.
“Every handwritten VI-1 form will have to be scrutinised and stamped before wine from Europe is allowed into the UK.
“It is estimated that it would take 12 full time wine inspectors a whole year to process the half a million new VI-1 forms expected to mount up after a no deal Brexit. This does not take into account the other work carried out by Wine Standards who currently consist of a team of six regional inspectors.”
A no deal Brexit would mean that the UK would lose the EU’s Excise Movement Control System (EMCS), which tracks alcohol coming in out of the country with electronic documentation. This would ‘likely to see ports descend into chaos’, says the WSTA.
Whitehall officials are holding emergency meetings to discuss the rise in paperwork - which is predicted to ‘treble their workload overnight’, according to the WSTA.