On 18 February 2019, the Department for International Trade (DIT) announced the signing of the UK-Israel Trade and Partnership Agreement, which replicates the existing trading arrangements under the EU-Israel Association Agreement as far as possible. It will come into effect as soon as the implementation period ends in January 2021, or on 29 March 2019 if the UK leaves the EU without a deal. The trade continuity agreement simplifies trade and allows businesses to trade as freely as they do now, without any additional barriers or tariffs. The agreement will see British businesses and consumers benefitting from continued trade with Israel after the UK leaves the European Union. The announcement stated, in part:
This will help to further strengthen the trading relationship between the UK and Israel, which was worth £4 billion in the year ending 2018 Q3.
The British vehicles sector could avoid up to £9 million a year in tariff charges on their exports that would apply if the agreement wasn’t in place, while machinery and mechanical appliance exporters could avoid up to £5 million a year.
The agreement also protects existing preferential market access for important products. Consumers in the UK will continue to benefit from more choice and lower prices on goods imported from Israel, such as pharmaceutical products, with Israeli companies acting as major suppliers to the NHS. The deal will ensure crucial protection for intellectual property rights and maintain high trading standards across industry.
Considering that the EU-Israel Association Agreement was signed in 1995 and the world of trade has evolved since, Ministers from both the UK and Israel re-affirmed their desire to see an ambitious free trade deal concluded between their countries.
On 18 February 2019, the DIT also announced the signing of a UK-Palestinian Authority agreement in Ramallah that replicates the existing trading arrangements as far as possible. It will come into effect as soon as the implementation period ends in January 2021, or on 29 March 2019 if the UK leaves the EU without a deal. The agreement simplifies trade and will allow businesses to trade as freely as they do now once the UK leaves the EU.
The agreement allows Palestinian businesses to continue access to the UK market tariff-free which will continue to benefit Palestinian producers in priority sectors, including exporters of fruit, nuts and vegetable fats including dates and olive oil.
Trading on the preferential terms that the continuity agreements provide, rather than on World Trade Organization terms, will continue to deliver significant savings and help to further strengthen the bilateral trading relationships. The UK is seeking to provide continuity for around 40 existing EU trade agreements covering more than 70 countries.