European Union ambassadors agreed to draft tariff rates that will be applied to the quota of imported goods after Britain leaves the EU. In order to become European Union Law, the TRQ schedule will need to get an approval from the European Parliament. As per the statement of EU, the bloc will apply to the quotas of imported goods after Britain leaves the EU.
The UK, currently being a member of the EU follows the common external tariff rules laid down by WTO for the European Union. Hence post Brexit, UK will set it’s own TRQ schedule. The UK may quote the existing tariff for some goods, however, it needs to draft new tariff rates for goods that are covered under TRQ’s category. The Tariff Rate Quota is a tariff which is implied on imported goods. It applies to a particular quantity of import goods and when the import goods’ quantity exceeds TRQ than it gets subjected to a higher tariff.
The Tariff Rate Quotas were set as the demand of the members of the European Union. Hence, the current TRQ’s for industrial, fish and agricultural were formed on the basis of the United Kingdom being an important part of the EU market. Hence the Quotas were set as the demands of 28 EU states. Therefore, the same set of TRQ’s could not be applied to the UK, post-Brexit.
Depending on the past trade facts, the existing import quantities would be divided among the EU and the UK.
In order to set new Tariff Rate Quota for various products, the EU needs to get into a negotiation process with WTO partners.
However, “the EU needs to be able to proceed unilaterally to the dividing up of the tariff rate quotas for the period between the UK’s withdrawal from the EU and the conclusion of a final agreement within the WTO,” the statement said.