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Preparing Wales: The new relationship with the EU

The UK left the EU on 31 January 2020. However, the UK-EU Withdrawal Agreement introduced a transition period until 31 December 2020, which meant that the UK remained within the EU Single Market and Customs Union. During this time there was little difference to the ways of doing business and moving around the EU.

Since the start of the EU Exit process, we have sought to work constructively towards a future relationship that would be in the best interests of our citizens and businesses. This has been clearly set out in publications since the EU Referendum, in particular Securing Wales Future and The future UK/EU relationship: negotiating priorities for Wales.

During the negotiations, we invested significant resources in planning and preparing for all possible outcomes (as described in our End of Transition Action Plan published in November 2020) and providing guidance to citizens, businesses and organisations via this website.

The Trade and Cooperation Agreement (TCA) between the UK and the EU was agreed on 24 December 2020. While it is not the deal we wanted, we supported the choice that would provide the closest possible relationship with the EU and therefore the least disruption. 

What are the differences in our new relationship with the EU?

The end of the transition period brought changes to our relationship with the EU. We no longer participate in the free movement of people, goods, services and capital between the UK and the 27 Member States of the EU and consequently, face new barriers to trade in goods and services and to our rights to travel, live and work elsewhere in Europe.

What it means for people in Wales

  • Travellers from Wales to the EU will need to be aware of new rules and restrictions which will apply to them
  • For Healthcare the TCA includes a scheme similar to the current European Health Insurance Card for travellers
  • Travellers from Great Britain will no longer able to take full advantage of the EU’s Pet Travel scheme
  • UK nationals no longer have an automatic right to live or work in the EU
  • The UK government has decided not to participate in Erasmus+.

What it means for businesses and employers in Wales

For traded goods:

  • To benefit from tariff free trade, businesses must have proof that goods originate within the UK or the EU according to the rules of origin requirements in the TCA
  • Businesses that trade with the EU will need to have a GB Economic Operator Registration and Identification (EORI) number in order to be able to make customs declarations
  • Businesses trading across the EU’s borders need to agree with each other which party is responsible for each step in the chain of supply including customs clearance
  • Businesses might be faced with needing to meet 2 sets of standards and regulations for their products in the future;
  • Even where standards are the same, when trading goods, businesses will need to follow conformity assessment procedures.

For traded services:

  • Businesses exporting services to the EU have to satisfy rules for third countries made by each Member State – meaning up to 27 different sets of regulations to navigate.

What it means for our security

The European Union seeks to protect the safety and security of all EU citizens, primarily through its well-developed structures for supporting law enforcement and judicial cooperation between Member States, structures in which the UK played a prominent role whilst it was a member.

In relation to foreign policy and defence, the EU’s Common Foreign and Security Policy (CFSP) sets the framework for EU political and military structures, and military and civilian missions and operations abroad.

In leaving the EU, the UK will no longer participate in many of these initiatives, although the TCA and associated agreements contain provisions which enable ongoing co-operation in some. Undoubtedly the TCA weakens the structures of law enforcement and security that help protect citizens in Wales and across the EU.

What it means for our communities and our society

Welsh communities have benefited from membership of the EU in a number of ways, including legal protections in important policy areas including workers’ rights and environmental standards.

For decades Wales has benefited from significant EU programme funding, which in recent years has amounted to well over £700 million a year. Despite the promises which were made during the 2016 referendum campaign that Wales would not be left worse off as a result of leaving the European Union, the decisions from the UK government have short-changed Wales and our communities.

EEA and EFTA citizens who have come to live and work in Wales play a crucial role in our society – they are employed in our key business sectors, deliver vital public services and strengthen the academic excellence in our universities. With free movement ceasing to apply, EEA and EFTA citizens (with the exception of those from the Republic of Ireland) no longer have the automatic right to live and work in the UK. The UK government has introduced a new points-based immigration system which now applies to all individuals who wish to move to the UK.

What happens next?

The TCA only provides a framework for a relationship that will need to evolve further and the relationship between the UK and the EU will now be governed by a complex set of arrangements.

We will continue in our commitment to working constructively on building a new relationship with our European neighbours and to working constructively with the UK government to ensure Wales has a voice in those governance arrangements.

This document sets out the implications of the new relationship between the UK and the EU as set out in the TCA and related documents for citizens, business, and communities in Wales as well as for our future security.

Read the full report

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