Davis ‘perfectly clear’ on customs union but EU still waiting to find out what UK wants

Smiling before the cameras after his meeting with Michel Barnier at Downing Street on Monday, Brexit secretary David Davis asserted that it was "perfectly clear" what Britain wanted after it leaves the EU's customs union.

Barnier, the EU’s chief negotiator, was having none of it, saying that he would not conduct a running commentary on the debate within the British government, adding that the EU hoped to find out in a few weeks what Britain wants.

After days of vituperation about the customs union from both wings of the Conservative Party, Downing Street on Monday sought to dampen the row. Britain would be leaving the customs union in order to pursue new trade deals around the world but it would seek a new customs arrangement or partnership with the EU.

In a paper published last year, the British government suggested that a “customs arrangement” would aim to continue some of the existing arrangements between the UK and the EU; put in place new “negotiated and potentially unilateral facilitations” to reduce and remove barriers to trade; and implement technology-based solutions to make it easier to comply with customs procedures.

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“This approach involves utilising the UK’s existing tried and trusted third country processes for UK-EU trade, building on EU and international precedents, and developing new innovative facilitations to deliver as frictionless a customs border as possible,” the paper said.

A “customs partnership” would involve “aligning our approach to the customs border in a way that removes the need for a UK-EU customs border”. This could involve the UK mirroring the EU’s requirements for imports from the rest of the world where their final destination is the EU.

“This is of course unprecedented as an approach and could be challenging to implement and we will look to explore the principles of this with business and the EU,” the paper acknowledged.

As Barnier said on Monday, the EU believes that Britain leaving the customs union will inevitably introduce barriers to trade. It is also unclear how Britain's proposals are consistent with its guarantee to avoiding a hard border on the island of Ireland.

Britain will remain in the customs union and the single market during the transition period that will follow its withdrawal from the EU in March 2019. Some ministers believe the country could remain in the customs union for a year or two longer, until new infrastructure is built at ports and before any new international trade deals are ready for implementation.

For hard Brexiteers, however, the customs union is about more than trade and economics. It goes to the heart of the government’s approach to leaving the EU and whether Brexit should be seen as a problem to be managed or an opportunity to be embraced.