UK Internal Market Bill Becomes Law

UK Internal Market Bill Becomes Law

New laws to protect jobs and trade across the whole of the United Kingdom will come into force from 1 January 2021.

The UK Internal Market Act, which has received Royal Assent today, will protect businesses, jobs and livelihoods by ensuring there are no harmful new barriers to trade between all parts of the UK.

This means that from 1 January businesses can continue to trade seamlessly across all 4 parts of the UK, as they have done for centuries, and ensures the UK’s world-leading standards for consumers and workers are maintained, including for food and the environment.

The law will enable the government to boost the UK’s economic recovery, increase investment across the whole country, create new jobs and emerge stronger from the pandemic.

“Businesses and government have been crystal clear that we must protect the integrity of our internal market which has allowed us to trade freely between all 4 parts of the UK for centuries, as we seize new opportunities outside the confines of EU law,” Business Secretary Alok Sharma said. “Today’s law will ensure businesses can continue trading unhindered from 1 January, while upholding the UK’s world-leading standards in food, the environment and workers’ rights, protecting jobs and helping us build back better from the pandemic.”

The end of the transition period will see powers on a wide range of issues flow from the EU to the devolved administrations in Holyrood, Cardiff Bay and Stormont for the first time. This will provide power over more issues than they have ever had before, including over air quality, energy efficiency of buildings and elements of employment law, without removing any of their current powers.

The UK Internal Market Act establishes 2 principles (the Market Access Principles) that apply to goods and services, ensuring our shared internal market continues to operate effectively:

  • the principle of mutual recognition (MR) ensures regulations from one part of the UK are recognised across each of the others
  • the principle of non-discrimination (ND) supports companies trading in the UK, regardless of where in the UK they are based, by preventing unreasonably discriminatory regulation

The Office for the Internal Market (OIM) will monitor the running of the UK Internal Market. It will provide independent, technical advice to all four administrations and their legislatures and sit within the Competition and Markets Authority (CMA). The OIM will begin operation later in 2021 following the necessary appointments process that the Business Secretary will be able to begin from the New Year.

As we wrote earlier, the UK Internal Market Bill is a welcome move for Northern Ireland businesses. The bill was introduced on 9 September 2020 and will guarantee that, from the end of the Transition Period, companies can continue to trade with the rest of the UK. Provisions within the UKIM Bill will ensure that businesses based in Northern Ireland will have ‘unfettered access’ to the rest of the United Kingdom, as set out in the New Decade, New Approach agreement.

Image: Cardiff Bay, Wales, UK, 2019, by Stephen Davies / Adobe Stock

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Chris McCarthy is an Zurich-based researcher and adviser at a consulting firm specialising in global economy, policy and trade. As a journalist, Chris writes about the global issues that have the most profound impact on the business environment.