The director general of the foremost association for exporters and importers has written to the UK government about the impact of the EU’s General Product Safety Regulation (GPSR) on British traders.
Since 13 December, under these new rules, many British exporters have been required to appoint an EU or Northern Ireland-based “economic operator” as a “responsible person” to ensure continued trade with Europe. The requirements also apply for Northern Ireland (NI), as the region is effectively within the EU single market under the terms of the Windsor Framework.
The European Commission has said that GPSR seeks to “address the new challenges posed to product safety by the digitalisation of our economies” and it applies across all sales channels, including e-commerce.
Tina McKenzie, the policy chair at the Federation of Small Businesses, has called the new requirements a “real barrier to international trade for some of our small firms looking to export to EU-member states, but also move goods to Northern Ireland,” according to Politico.
Solutions needed, say traders
Marco Forgione, the director general of the Chartered Institute of Export & International Trade, has written to exports minister Gareth Thomas to pass on “feedback” from the body’s business community about how GPSR has “impacted businesses in the UK’s e-commerce trade community”.
Forgione, who also chairs the E-Commerce Trade Commission, said that the new ‘responsible person’ requirement was “challenging for many small businesses”.
“This is both the case in terms of paying for the services of such a representative, but also in relation to identifying ones which are trustworthy, often at short notice,” he wrote.
He said that the Chartered Institute would be “keen to work with the government” on finding solutions to the challenges faced by businesses around appointing a ‘responsible person’ in the EU or NI.
Market readiness
Forgione also highlighted that e-commerce marketplaces have so far struggled in “implementing appropriate support for their sellers”.
He cites issues faced by various platforms as a result of NI being affected by the new rules, giving the example of Etsy.
Etsy has had “terms of use which mean that businesses using their marketplace must sell to their home country (UK), yet means had not been provided to remove NI addresses from the UK settings when GPSR came into force”.
This created a risk of users failing to comply with GPSR because they were “without either the means to remove NI addresses, or…they were unable to appoint a representative and gain new certification/documents for products ahead of time”.
Referring to feedback received from some businesses, he said:
“For some sellers, appointing a representative and gaining this documentation was not worth the cost and time for the volume of sales they received from the EU or NI.”
Business lost
Forgione highlighted that Etsy has announced it will introduce new settings to allow firms to more easily opt out of selling their items in the EU or NI, but this fix won’t be in place until the end of next month.
Other platforms have had to implement similar changes, including Folksy, which has altered delivery regions so that the UK now excludes NI and NI is now included in an ‘EU and NI’ category, according to the BBC.
In the meantime, he says business have “had to cancel orders to avoid risking breaching GPSR regulations by selling certain items into NI”.
He cites the example of a business the Chartered Institute had spoken to which was at risk of losing 50% of their total annual revenue due to the “potential need to close their Etsy shop”.
The BBC also reported last month that some business had suspended NI sales due to the new GPSR requirements.
Johanna Haughey-Lewis, owner of homewares business Weirdstock, told the BBC that "there hasn't been enough time or enough information in order to get this right".
Forgione said that the situation “demonstrates the need to accelerate regulatory cooperation between the UK and the EU”.
Supporting businesses
EU relations minister Nick Thomas-Symonds has said that the rules are “likely to have limited impact” on UK businesses, in response to a written question.
“Where businesses need to make changes, we expect that they will be adapting anyway in order to continue trading with the EU,” he said. “We are keeping this matter under careful review and are supporting small and medium businesses through providing detailed guidance and via regular engagement to ensure we are enabling them to trade freely across the whole of the UK.”
Forgione says that the Chartered Institute is itself “working hard… to support small businesses in navigating GPSR”.
This support has included a Lunchtime Learning webinar for the body’s members, explanatory guides on the new rules and direct support through its technical helpline.