Bow Group's Daniel Hannan claims that staying in the customs Union would damage the UK

Brexit remains on track — just. The United Kingdom, ministers have decided, probably won't stay in a version of the EU's customs union after all.

Some Eurosceptics had been complaining that keeping the customs union would mean 'staying in the EU in all but name', but the reality is far grimmer. 

Allowing the EU to dictate our trade policy while giving up any say over it would make us worse off than now. It would render Brexit not just pointless, but harmful.

Yesterday, members of the key Cabinet Brexit committee wisely refused to endorse any form of customs union. Good for them. 

This was something of a signal moment, proof there is a resolve at the very top of the party to stand up for Britain's interests. 

Although it might seem like a compromise, the customs union is nothing of the kind. Many of the MPs and peers pushing the idea know perfectly well how damaging and unworkable it would be. 

Their objective is not to find a better outcome, but to weaken our negotiating position in the hope of derailing Brexit.

The first part of that aim, at any rate, has so far been working a treat. Brussels has hardened its position in response to what it sees as British feebleness.

Theresa May and her ministers keep saying that they want Britain to be the EU's 'best friend' and 'closest ally'. Far from reciprocating, Eurocrats respond by sneering, scolding and hectoring.

They want a punishment clause in the exit agreement, giving them a right to sanction the UK. They want a customs border between Great Britain and Northern Ireland. 


Those Remainers are doing it in two ways. First, they have passed an amendment in the House of Lords that would formally delay our departure.

Second, they are manoeuvring to keep us in some form of customs union after we leave — even worse than not leaving, since we would effectively remain in with no veto. The Brussels fonctionnaires can't believe their luck.

Few Remainers admit that these tactics are designed to keep us in the EU. Yet that is their only possible motive.

Let's consider the two proposals in turn. The House of Lords amendment says, in effect, that if Parliament doesn't like the final deal, it should have the power to require us to stay in the EU until it gets an outcome it is happy with.




David Davis and Boris Johnson (pictured left and right in Downing Street today) are hoping to join forces with Michael Gove Liam Fox to kill off the customs partnership proposal

Most of the Lords pushing this idea were on their best behaviour during the debate. 

They didn't admit that they were seeking to capsize Brexit, talking instead of the importance of parliamentary sovereignty — rather a novel concept to many of them, who had spent their careers until now jeering at sovereignty as a Victorian hang-up.

One or two, though, let the cat out of the bag, talking openly of trying to block Britain's departure.

Think, for a moment, of what will happen if their amendment stands. Why would Brussels offer acceptable departure terms? Why would it even hold serious discussions when it could rely on Britain's Europhile politicians to halt Brexit?

We'd be the pitiable country that had tried, and failed, to leave, trapped indefinitely in a grim departure lounge.



The Prime Minister (pictured in Downing Street today) met with her Brexit 'war cabinet' today after sixty Eurosceptic Tory MPs backed a 30-page report savaging the plan

The situation could be prolonged until some future pro-EU government withdrew our notice to quit, marking our final and total humiliation.

Even if Tory whips succeed in overturning that amendment, the customs union threat still hangs over us, and it is the deadlier of the two.

It is important to understand quite how serious the danger is. Staying in the customs union is not a middle way. It is not like having a medium burger because 52 per cent of voters wanted it well done and 48 per cent wanted it rare. 

Quitting the EU while keeping the customs union is like binning the burger and eating the napkin.

I'm all for compromises that reflect the narrowness of the vote in the referendum: staying in some EU programmes, replicating chunks of the Single Market through domestic legislation, perhaps rejoining the European Free Trade Association alongside old allies Iceland, Liechtenstein, Norway and Switzerland.

But the customs union is not such a compromise. Staying in would give Brussels 100 per cent control of our trade policy.

In fact, it's even worse than that: a customs union would oblige us to match the EU's concessions vis-à-vis third countries, but those countries would have to reciprocate only with the remaining EU 27, not with Britain. 

As Barry Gardiner, Labour's trade spokesman, put it before his party's cynical U-turn: 'The EU could do a deal with another country — let's say America — which we would be bound by in the UK. 

We would have to accept the liberalisation of our markets. Why would America give us that access when it's got all the liberalisation of our markets it wants?'

Quite. Why would any country accept such terms?

Norway is as close to the EU as a non-member can be, and exports more than twice as much per head to the EU as we do. Y

Yet almost no one in Norway wants to join the customs union. How odd to see British parliamentarians demanding worse terms than Norway.



Amber Rudd was thought to have been backing Mrs May ahead of a crunch showdown on the customs union in the Brexit 'war Cabinet' sub-committee (pictured together in February). But it is unclear where Mr Javid will fall on the issue

In theory, the 'customs partnership' would have allowed Britain to negotiate its own trade deals. 

The UK would apply EU tariffs to goods entering its territory, and then offer rebates if they were not destined for EU territory.

In practice, it wouldn't work. It may be illegal under World Trade Organisation rules, and it will be years before it is technologically feasible.

Even if it were possible to track every consignment entering the UK to see whether there was onward shipment to an EU state, why would any country want to sign a trade deal with us? 

Having to pay full EU tariffs at our border and then claim a rebate back is hardly an appealing prospect. 

We'd face all the costs of running this complex system, with little chance of global trade deals.

If our civil servants are able to find a way around these problems — if they genuinely could find a scheme that would give us regulatory and commercial autonomy while avoiding customs checks with the EU — I'd be delighted.

The original article can be found at -

Saturday, May 5, 2018