2026-07-21
A new briefing from the House of Commons Library says the tariff-free trade terms in the U.K.-EU Trade and Cooperation Agreement still depend on a basic condition that many businesses continue to find difficult in practice: goods must meet rules of origin requirements to qualify for 0 tariffs and no quotas.
The paper, published Monday, lays out the customs framework that has governed trade with the European Union since the U.K. left the EU customs union, single market and VAT area. It says the agreement has removed tariffs and quotas only for goods that can be shown to be “originating” in the U.K. or the EU, either because they were wholly obtained there or because they were substantially transformed in one or both markets.
That distinction matters for companies that move food and drink across the Channel, including importers and exporters of wine, beer and spirits. In those categories, costs can turn on whether a product is correctly classified and whether traders can document origin well enough to claim preferential treatment. If they cannot, duties or VAT may be charged differently than expected, which can affect margins.
The Library notes that rules of origin are designed to stop goods made in third countries from being routed through the U.K. or the EU simply to avoid tariffs that would otherwise apply. That means businesses re-exporting products from outside Europe with little or no further processing may still face tariffs when selling into EU member states or bringing goods into Britain under certain circumstances.
The briefing says compliance is product-specific and can be burdensome. Some businesses either cannot claim the zero-tariff preference available under the agreement or choose not to do so. Even so, use of those preferences remains high overall. In 2024, 83% of goods exported from Great Britain to the EU27 used preferential rates where available, according to the figures cited in the paper. For agricultural exports from Great Britain to the EU27, the preference utilization rate was nearly 93%. The lowest rates included textiles at 57% and footwear and headgear at 24%.
The document also sets out how customs procedures have expanded since Brexit. Customs declarations are now required for all goods imported into Great Britain, while exporters must also comply with safety and security rules and any licensing or certification requirements that apply to specific products. The Library warns that incorrect commodity codes or inaccurate recording of origin in customs declarations can lead to the wrong amount of tax or duty being charged.
For beverage traders, that can be especially relevant where supply chains involve imported bulk wine, bottled spirits using non-U.K. ingredients, or mixed consignments moving through distribution hubs. The legal tariff headline may be 0, but access to that rate depends on paperwork and product treatment rather than on destination alone.
The briefing says the EU introduced full customs controls on Jan. 1, 2021. The U.K., by contrast, phased in border controls on imports from the EU over several years and postponed full checks more than once. Its Border Target Operating Model, first published in August 2023, set out a risk-based system for imports into Great Britain of live animals, products of animal origin, plants and plant products from all countries, including the EU.
Under that model, agrifood goods are subject to identity and physical checks based on biosecurity, public health and food safety risks. The remaining post-Brexit controls included health certification and sanitary and phytosanitary checks on agrifoods, physical SPS inspections at designated Border Control Posts and safety and security declarations used by border authorities to assess risk.
The government had also planned to digitize border formalities through a Single Trade Window, described as a single digital gateway for most border requirements. But in November 2024 it said work on that system would be paused during 2025-26 while future border requirements and user needs were reviewed.
The paper points to another possible change ahead for food and drink trade. Following a U.K.-EU summit in May 2025, both sides began negotiating an SPS agreement on agricultural products, food and drink that would create a common SPS area. Government guidance cited by the Library says such an agreement would remove most export certification and reduce routine border controls for many agrifood products.
If completed as planned, the agreement could ease trade in products affected by post-Brexit restrictions and reduce friction for parts of the drinks supply chain tied to agricultural inputs or food regulation. The guidance indicates that the government wants the deal to take effect in mid-2027, though timing and detailed requirements remain subject to negotiations.
For now, existing controls remain important. Since Jan. 31, 2024, businesses have had to pre-notify imports of animals, certain plants and plant products, and high-risk food and feed. Certain high-risk animal and plant products require health certificates and checks. From April 30, 2024, documentary and physical checks on EU imports were gradually introduced at Border Control Posts, focusing on medium-risk goods and those with the highest biosecurity risk.
To cover SPS inspection costs, businesses must pay a common user charge on imports of various categories of animal and plant products entering Great Britain through Dover or the Eurotunnel. The government has also postponed physical checks on medium-risk fruit and vegetable imports from the EU until Jan. 31, 2027 while SPS talks continue.
The Library says businesses trading with the EU are responsible for making customs declarations on all goods imported into or exported from the U.K., checking whether special licensing or certification rules apply, classifying goods correctly and keeping records of origin. Since Jan. 31, 2025, entry summary declarations have also been required for EU imports into the U.K., while exports to the EU must include U.K. safety and security information and meet EU import safety requirements.
The paper stresses that these processes can be complex enough that many firms use customs intermediaries to complete paperwork on their behalf. It directs traders to HMRC guidance on proving originating status and claiming reduced customs duty rates in U.K.-EU trade, as well as HMRC’s tariff tool for checking applicable duties and VAT rates.
For drinks companies trading between Britain and Europe, the message is practical rather than political: tariff-free access exists under the agreement, but only when origin rules are met and documented correctly. In sectors where margins are often tight and consignments can include products sourced from several countries, customs errors can quickly become a cost issue at the border.