EU Launches 4 Infringement Procedures Against the UK Over Northern Ireland Protocol
The European Commission opened four different infringement procedures against the U.K. over its alleged failure to comply with certain parts of the Northern Ireland Protocol. The commission launched the infringement proceedings following the UK's "unwillingness to engage in meaningful discussion" and the UK Parliament's "continued passage of the Northern Ireland Protocol Bill." The four infringement procedures are for failing to (1) comply with the customs requirements on the movement of goods from Northern Ireland to Great Britain, (2) "notify the transposition of EU legislation laying down general EU rules on excise duties," (3) notify the transfer of EU rules on exicse duties on alcohol and alcoholic beverages, and (4) implement EU rules on value added tax for e-commerce.
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The lattermost point concerns the Import One-Stop Shop, which is a scheme businesses have been able to use since July 1, 2021 to comply with VAT obligations on sales of imported goods. Through the platform, suppliers selling imported goods not valued over around $150 to EU buyers to pay the VAT via the tax authorities of a member state instead of having to register in every member state in which they sell. The UK has not implemented this platform for Northern Ireland.
As for the UK's failure to comply with certain customs requirements, the EU alleged that "this significantly increases the risk of smuggling via Northern Ireland." Traders can now circumvent EU restrictions on the export of goods to third countries as well as declare goods for export in the EU and keep them in the customs territory via Northern Ireland. The UK has failed to collect the relevant export declaration data for goods shipped from Northern Ireland to Great Britain, the commission said.
"Today's decision marks the beginning of formal infringement procedures, as set out in Article 12(4) of the Protocol, in conjunction with Article 258 of the Treaty on the Functioning of the European Union," the commission said. "The letters sent to the UK request its authorities to take swift remedial actions to restore compliance with the terms of the Protocol. The UK has two months to reply to the letters, after which the Commission stands ready to take further measures."