As Brexit draws nearer and with the likelihood of an unregulated exit still not off the table, EU-27 companies importing or selling food or cosmetics from Great Britain face liability risks if they continue to sell these goods after a No-Deal Brexit. As a result, UK companies exporting to EU-27 member states must find a way for their business partners to operate in a changed regulatory environment.
The good news is that if a No-Deal Brexit does occur, this does not mean that UK goods will have to be removed from EU shelves the morning after Britain acquires third-country status.
All goods delivered before the cut-off date will be deemed to have been placed on the market before the cut-off date and can in principle be sold without change.
UK products entering the EU market after that date, however, face significant procedural changes. To be distributed legally, food and cosmetics will need responsible companies based in the EU.
For every UK food product imported into the EU, this dealer will become the food business operator responsible for the safety of the product. As the first point of contact for supervisory authorities, this dealer will have to fulfil notification duties and must be identified on product packaging.
For cosmetics, the EU-based importer, as the responsible person, must report the products to the European Commission and maintain a product-information file for each individual article.
All these duties and responsibilities will apply to goods purchased from the UK under a purchase contract concluded after the cut-off date in the event of a No-Deal Brexit. The same procedure will apply for goods produced after the cut-off date even if there are different contractual arrangements.
If these duties are not fulfilled, supervisory authorities and competitors will be aware of it by the absence of a EU-27 company listed on the label. In short, if a product label lists a British company only, this will indicate that the product is not marketable in the EU-27.
This is not the only relevant change that will take place in labelling in the event of a No-Deal Brexit. In this situation, product labels will have to bear different information on the origin of the product since the item's status will change from "EU" to "non-EU". This will apply to cosmetics and to food products with organic certification. According to the Food Labelling Regulation, in the event of a Hard Brexit, new rules will apply for listing the country of origin or place of origin.
If labelling is changed appropriately after the cut-off date to indicate that a product satisfies legal requirements at the national and EU levels regarding the safety of ingredients and contained substances, this item will be marketable in the EU.
There will, however, be exceptions. For example, the use of the EU organic logo on products produced in third countries requires that certain prerequisites are met that will not automatically be given should a Hard Brexit take place.
Furthermore, the body overseeing the organic logo cannot be based in a third country. Hence, even if the organic food product originates in France, a British control body cannot attest to its status as an organic product meeting EU specifications. As a result, the item will lose its EU marketability.
Similarly, goods will lose their marketability after a Hard Brexit if they contain genetically modified ingredients that have been solely approved by a UK-based authority.
For food products containing ingredients falling under the Novel Food Regulation, the question remains whether a history of consumption in Great Britain will be relevant for denying its novelty in the European market. Manufacturers and dealers of these products should seek expert opinions on these matters and make all necessary preparations.