In the event of a ‘No Deal’ Brexit, the requirements for placing certain goods on the UK and EU markets, including the requirement for conformity assessments and specified product labelling, will change. The Government has recently published guidance on placing manufactured goods on the UK and EU market, to assist in preparing for a No Deal Brexit. The guidance deals with harmonised goods and sets out what to expect when compared to the current position.
The Current Position
New Approach Directive Goods
Compliance marking is mandatory for all goods which are covered by the scope of the New Approach Directives. Applying the CE mark to goods confirms that they meet all relevant requirements set out in the applicable laws. Each directive specifies whether an authorised third party or ‘notified body’ must be involved in the conformity assessment procedure. Notified bodies are authorised by national authorities, officially approved by the European Commission and listed on the NANDO (New Approach Notified and Designated Organisations) database.
Under the ‘mutual recognition principle’, where there are no harmonised EU product requirements, member states must not prohibit the sale of goods that have already been lawfully sold in another member state. This is a broad principle that even applies to instances in which the member states may have conflicting requirements in relation to the same goods. It can be discarded in certain circumstances such as where public health, the environment or consumer safety are at risk, and where the measures taken can be shown to be proportionate.
Changes to New Approach Directive Goods
Marking of Goods Placed on the Market
Once the UK leaves the EU, goods offered for sale on the UK market for the first time which currently require a CE mark will need to bear the UK Conformity Assessed (UKCA) mark, a new conformity marking to indicate that goods comply with the relevant UK regulations. Any goods already purchased by the consumer can continue in circulation. There will be a transition period following Brexit in which goods which meet EU requirements and bear the CE mark, can be placed on the UK market. This means that products on shelves or in warehouses will not have to adopt the UKCA mark straight away. The government has confirmed that it will give businesses notice before this period ends.
The general rules applicable to the UKCA marking will mirror those applicable to the use of the CE marking. Government Guidance has indicated the circumstances in which it is needed and retained whilst specific legislation is needed to govern its use.
The UKCA mark will not be recognised in the EU, so UK manufacturers who wish to place their goods on the market in the EU will need to ensure that their goods bear the CE mark. Further, after exit day, products from the UK placed on the market in the EU bearing the CE mark will be likely to be considered as importers, which is not the case whilst being a member state. Distributors will then be obliged to verify that the manufacturer has taken the necessary steps to allow the product to be placed on the market, that the requisite documentation such as the EU Declaration of Conformity and the technical documentation is available upon request, and contact with the manufacturer could be needed at any time. The importer’s name and contact details should also be displayed on the product or packaging.
Changes to Conformity Assessments
As UK based ‘notified bodies’ are authorised to continue to assess product regulation under EU provisions, the current position is dependent upon the status of the UK as a member state of the EU. UK notified bodies will lose their status as EU recognised bodies upon Brexit. Recent Government Guidance makes clear that if the UK leaves the EU without a deal, the results of the conformity assessment carried out by UK conformity assessment bodies will no longer be recognised in the EU. This means brand owners must get products assessed and marked by an EU recognised conformity assessment body to sell them in the EU post-Brexit. You can also arrange for assessments to be transferred to an EU-recognised body before the UK leaves the EU.
At the moment there are ‘notified bodies’ which are located outside of the EU which can also test products, for example in the USA. Non-member states can certify to the same standard as those within the EU. The Member States, EFTA countries (EEA members) and other countries with which the EC has concluded Mutual Recognition Agreements which list the certified bodies that can authorise products that need third party verification prior to placing them on the market. We cannot see any evidence of this being negotiated as regards to the UK in advance of the EU exit day. This does not mean that it will not be finalised before Brexit completes, and if it does the notified bodies can continue on the same basis as they do now.
With the second most notified bodies in the world, the UK will want to continue to pass CE markings to enable the passage of goods for legal reasons (if prescribed by law) or for commercial reasons (it allows efficient review of standards). By way of further comfort, the UKAS website states:
“The European co-operation for Accreditation (EA) has confirmed that UKAS can continue as a member during the implementation period agreed until December 2020. EA has also agreed to give further consideration to changes to the membership criteria to ensure that UKAS can continue as a member body beyond this date. The agreement of the implementation period also provides certainty that the work of UK Notified Bodies will continue to be recognised during this time”.
Therefore, at least until December 2020 it appears as though the same process of accreditation for notified bodies will apply. If being dubious, you could say that this authorisation is also based in EU law, whereas the intention is made clear that the notified bodies shall continue to have an authority, whether granted by virtue of the relevant regulatory body’s indicated enforcement position, or by newly granted authority.
Changes to Non-Harmonised Goods
On exit day, the ‘mutual recognition principle’ will no longer apply in the UK. Those wishing to place goods onto the EU market must ensure that the goods comply with the national requirements of the first member state they are exported to.
Practical Implications for Businesses
The prospect of a ‘no-deal’ scenario creates uncertainty over the landscape of product compliance after EU exit day. Although many of the principles underpinning the regime will remain the same, businesses will encounter an extra layer of conformity whether placing goods on the EU market or importing goods into the UK.
Due to transitional periods, there will be time for businesses to deal with the implications of a ‘no-deal’ Brexit following exit day, however, the period and basis for which this will extend is currently unknown. It is crucial for businesses to put in place systems for the implementation of these changes as quickly as possible following exit day, to allow continuity in trade and avoid unnecessary disruption.
Article co-authored by the CMS Trainee Solicitor Kerry Nolan.