New World Trade Organisation (WTO) rules are set to cut the cost of global trade by billions of pounds every year, it has been announced.
The Department for International Trade (DIT) – who helped broker the agreement – said the deal represents a massive win for service businesses in the UK.
Here’s what you need to know.
The UK is among 67 WTO members to have agreed to implement the Services Domestic Regulation, a deal that will cut red tape around licensing and qualifications.
The other signatories include the US, China, Russia, Japan, Germany, France and Canada.
According to reports, the agreement could reduce service trade costs by around seven per cent per year – around £113 billion annually.
The regulation will cover approximately 90 per cent of global services trade, meaning Britain – the second-largest services exporter – will be among the primary beneficiaries of the new rules.
The deal comes after Britain formally joined the WTO as an independent member last year, following its departure from the European Union.
Benefits for British businesses
The DIT said the new regime will make it easier for small and medium-sized enterprises (SMEs), as well as larger businesses, to “navigate foreign markets and obtain authorisation to export overseas”.
Examples of just some of the benefits include:
- Faster processing times for licensing applications
- The acceptance of electronic copies of qualifications
- An end to unreasonable and hidden fees.
“Historic deal” delivers trade rules “fit for the 21st century”
Commenting on the announcement, the Government said the “historic deal” delivers trade rules “fit for the 21st century”.
“As the world’s second largest services exporter, the UK is particularly aware of how important it is to cut red tape and get trade flowing to build back better from the pandemic,” said Secretary of State for International Trade Anne-Marie Trevelyan.
Miles Celic, Chief Executive Officer at TheCityUK, added: “This agreement will be celebrated by the UK’s financial and related professional services industry. It is an essential step towards removing the types of trade barriers most often experienced by services exporters.
“This necessary and innovative agreement will reduce costs for UK businesses, support women’s economic empowerment, and is a significant win for the WTO and wider multilateral economic cooperation.”
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The new regulations are set to come into force from 2023.
For help and advice with related matters, please get in touch with our team today.