Brexit red tape puts brakes on UK innovation and EU sales | Manufacturing sector

British inventions are being brought to market overseas because new Brexit safety certification rules mean they can’t be sold in the UK.

Trade bodies and entrepreneurs have blamed the government’s decision to stop accepting the European Union’s CE mark and instead create a new UK Conformity Assessed (UKCA) mark showing that a product is safe.

When the new system is in place, it means a manufacturer will need to pass one set of tests for the EU and another for the UK, creating extra layers of red tape. But some things cannot yet be tested because the UK has no facilities to test building products including glue, sealants and glass, or some medical supplies.

An entrepreneur in the UK told the Observer that he had not been able to have a medical device certified in the UK or EU and so had set up a company in the US, where the product will be manufactured and sold. Medical industry sources said British companies were also setting up divisions in Japan.

The change from CE to UKCA was meant to happen last year but was delayed and will now come into effect on 31 December 2022 at midnight, European time. But ministers further delayed compulsory UKCA markings for electrical products like iPhones, so CE markings can still be used until 2025.

Then, last week, the Medicines and Healthcare products Regulatory Agency announced that it was recommending a delay until July 2024 for medical products.

Yet some sectors will still face a cliff edge on New Year’s Day, and the Construction Leadership Council, representing the building industry, wrote to new business secretary Grant Shapps and new housing secretary Michael Gove last week, warning them that plans for new homes, schools and hospitals were being affected. “Approximately 28% of products are imported, and half of [those] from the EU, and therefore these products are also affected,” the letter states. “As a result, many global manufacturers now regard the UK as just too difficult to do business with, which has resulted in products being withdrawn – impacting on the UK’s ability to deliver completed projects.”

The new UKCA logo.
The new UKCA marking will come into effect on 31 December 2022.

One of the letter’s authors, Peter Caplehorn, chief executive of the Construction Products Association, said: “This is affecting inward investment [and] innovation. Products are under continuous development and, from the turn of the year, if any product is substantially changed or upgraded, then it will need recertification.

“We’ve got one testing facility in the UK [for] radiators. And they’ve done an analysis on the amount of radiators that they put through their system. If they have to retest all of them, it would take 75 years.”

Steve Lee, director of diagnostics regulation for the Association of British Healthtech Industries (ABHI), said the MHRA’s delay would be helpful, but the uncertainty was already causing serious problems. “People are not seeing the UK or the EU as a place to innovate and bring new products to market,” he said. “People are looking at other jurisdictions because the regulatory landscape is so uncertain.”

A major change to EU legislation means that manufacturers face a similar problem in Europe. The changes – introduced after scandals relating to ruptured breast implants and metal-on-metal hip implants – have also caused a backlog in medical device testing in the EU. One in 10 of the UK’s medical device manufacturers has stopped attempting to innovate, according to an ABHI survey of its members.

Around 600,000 medical products – from syringes and surgical instruments to HIV tests and prosthetic hips – are used in the UK, but ABHI members reported in a survey this month that one in five will be taken off the market in the next five years. Two-thirds expect new devices will be delayed in coming to the UK. “Almost certainly there will be products which are either temporarily or permanently unavailable for use in the UK,” Lee said.

The British Chambers of Commerce (BCC) said there was more uncertainty arising from the government’s decision to allow CE-marked products in Northern Ireland, which has no trade barriers with the EU.

“By the end of 2025, CE-marked products made in Northern Ireland will be able to circulate in Britain, but those from the EU, Switzerland or Turkey won’t,” said William Bain, the BCC’s head of trade policy. “How will they differentiate between products made in Northern Ireland and those that are imported into Northern Ireland and then sent over to Great Britain? All of that needs to be resolved, and it’s causing great uncertainty.”

Manufacturers represented by Make UK want ministers to phase in regulations, and three quarters want the CE mark to continue to be recognised. If UK regulations diverge substantially, two identical cars for the UK and EU might need to be made with hundreds of different components.

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