Brexit: "Geldings will be subject to an 11.5% tariff"

brexit

Now it's quietened down in Westminster, Zoe from PLMR has time to reflect how Brexit will affect the equine industry. 

It's all quiet down here in Westminster now that MPs have dispersed to all four corners of the UK for the summer recess.

While they're all away and the political calendar has significantly quietened down, now's a great time to update you on some of the wider implications Brexit might have on the equine sector. 

In my recent blogs, one of the main implications I've mentioned was EU citizens’ right to stay in the UK, which will have a big impact on the sector.

Yesterday, the Government announced that the freedom of movement between the UK and the EU will end in March 2019.

After that point, EU citizens moving to Britain will have to register in the short term, and a permanent policy will have to be implemented for the long term. This policy is as of yet unknown.

But there are, of course, more issues to consider. Here I'm going to look at issues facing the racing industry in particular, but these will also have implications for the wider equine sector.

racehorses

What it Brexit means for racing

In May, representatives across the British, Irish and French racing industries met in London with the EU’s chief Brexit negotiator Michel Barnier.

During this meeting, the racing industries presented a united front and discussed the key concerns it has about Brexit. 

Those of you who work in the racing industry, and indeed those who don't, will be aware of how inextricably linked the British and Irish racing industries are, and also to an important extent, the French racing industry too.

Indeed, it was reported in The Times last month that “two thirds of Ireland’s annual foal crop is exported” and 80% of those (circa 5,000 foals to the value of €250 million) goes to Britain.

However, once the UK leaves the EU, it's currently looking a whole lot harder for this cooperation to continue as is.

As I explained in one of my early blogs, this cooperation is encompassed as part of the Tripartite Agreement by which means that thoroughbred horses can travel freely between the three countries so long as they have an EU passport and are on a livestock database.

While this agreement predates the UK’s membership of the EU, by leaving the EU now, it's far less straightforward for the UK as a non-member to conduct bilateral agreements with members - i.e. Ireland and France.

This of course doesn't just have bureaucratic implications for the racing industry but for a number of aspects of the equine sector that involve the movement of horses.

horse-eating

A tariff on geldings and feed?

As far as we’re concerned, we're still currently heading for a hard Brexit.

This means not being a member of the single market and not being a member of the customs union.

I’ve written before about the potential of World Trade Organisation tariffs being imposed as a result, and frustratingly, at this point in time, it's still looking like these will be applied.

While pure breed animals will be exempt from these tariffs, geldings will be subject to an 11.5% tariff and as will feed and other equine products.

This will have ramifications for the whole equine industry, unless negotiations over the next two years lead to a soft Brexit whereby Britain remains in the single market.

Will anyone be able to afford horses? 

Speaking of money, there's the general issue of economic uncertainty that will affect all sectors.

It’s been a year since the referendum and we’re still not sure what Brexit will actually look like, and we won’t know for quite a while.

This uncertainty is likely to mean that people are tightening their belts and this could mean they spend less on riding lessons and trips to the races, for example.

As I've said before, the EU wants to agree the divorce proceedings first, before it starts talking about how any trading relationships between the UK and the EU will work post Brexit.

When the latter stage comes, sectors will be seeking to get to the fore of Government negotiations. It's the racing industry's goal that the equine sector will be there.

What was clear in the meeting with Michel Barnier, and what has been clear in the media coverage about the racing industry since the Brexit vote, is that the industry is not going to take this lying down.

It's true that at this very moment in time, the equine sector is not as high up on the Government’s priority list when it comes to Brexit negotiations as it would like to be - but the industry is determined to rally together and show politicians and key Brexit decision makers just how important racing and the equine sector is to Ireland and France in particular but also to the wider EU.

I'll keep you posted as this develops.