Rural Economy Secretary letter to UK Government on crab claw exports to the EU
Rural Economy Secretary Fergus Ewing has written to the Secretary of State for Environment, Food and Rural Affairs on issues relating to crab claw exports to the EU.
A copy of the letter is below:
I wrote last week to highlight the grave situation that Scotland’s food and drink exporters find themselves in after the Brexit deal imposed a swathe of new bureaucracy and highlighted the economic impacts from prohibited and restricted goods, of which Crab claws were listed.
You will be aware that Defra communicated to the industry on the 31st of December 2020 in an industry newsletter that “You will no longer be able to export crab claws to the EU once the transition period is over from 1 January 2021. Under EU regulation, only whole crabs can be placed on the market if the export falls under the 03-tariff heading”.
This announcement came as yet another unexpected Brexit impact that neither businesses or I were aware of prior to that announcement. This differs from the live bivalve mollusc issues that we have worked with Defra on for some time. Scottish exporters immediately stopped exporting Crab claws and raised this issue with me and my officials, as to why this prohibition was in place, as the statement communicated by Defra failed to give any specific detail of the legislation that prevented this export. Could I ask you to confirm what was the legal basis for providing this advice?
Scottish officials have worked to understand this problem and fed back their findings to Defra in order to inform questions going to the European Commission on this issue, and they continued to develop their understanding of it. Having concluded investigations, which involved agreeing the legal understanding with Defra’s own advisers, it appears that there should not be a barrier to trade where whole edible crabs of species Cancer pagurus are landed in Great Britain and on first sale in Great Britain are sold whole, then the claws are removed after first sale for export to and subsequent sale in the European Union. This is based on our understanding of the relevant regulatory framework viewed as a whole, with the crab claws being marketed under the CMO Regulation (Regulation 1379/2013).
On the basis of our analysis, it would appear that the UK Government have misinformed Scottish exporters, indeed exporters of crab claws from across Great Britain causing a significant loss of income, coming on top of issues last year with crab exports to China. This shows the incredible recklessness with which the UK Government has administered the Brexit process and a complete disregard for an important part of the Scottish shellfish sector, worth £3 million a year to one Scottish business alone.
This error has meant that, for the past four weeks, some businesses which export crab claws to the EU have been processing and freezing the product which is now clogging up the freezers of Scottish businesses. Customer relationships have been damaged and orders have gone unfulfilled, causing reputational damage to the high quality and, before Brexit, reliability of Scottish Seafood exports. A sudden release of frozen product threatens to crash prices all of which puts pressure on business already reeling from the impacts of Covid and post Brexit operational change. You must take responsibility for this error, and I hope that you will add this issue to the qualifying criteria for the recently announced compensation scheme, as business have suffered these impacts through no fault of their own.
It is essential that this matter is resolved as quickly as possible and it is my intention to release communications to the Scottish sector today advising them that we do not believe that this restriction should be in place, citing clearly the detail behind this decision. We will of course advise that they check with their importer in the EU to safeguard their exports. I have included a copy of communications in the Annex.
It is disappointing that this issue was not highlighted to me and officials here in Scotland before the prohibition was announced. Had you done so, we could have avoided this mess. We know our industry and the laws that govern fisheries here in Scotland and, as you have said yourself on many occasions, when you work with us the outcome is usually better for everyone. It is fortunate that this has been investigated quickly so industry can get back to business.
This issue just emphasises why it is essential that we work together to address the post Brexit chaos.
On the 31 of December 2020 the UK Government informed Scottish seafood representatives and shellfish exporters that “businesses will no longer be able to export crab claws to the EU once the transition period is over from 1 January 2021. Under EU regulation, only whole crabs can be placed on the market if the export falls under the 03-tariff heading”.
It is the Scottish Government’s view that if whole edible crabs (Cancer pagurus) are landed in Great Britain and on first sale in Great Britain are sold whole, but then the claws are removed after first sale for export to and subsequent sale in the EU, there is no prohibition under EU law preventing this subsequent sale of edible crab claws in the EU. In addition, the Scottish Government’s understanding is that these crab claws should be classed as ‘prepared product’, with CN Tariff code 1605 being the most appropriate to use for exports to the EU in this instance. Therefore the prohibition relating to CN Tariff code 0306, as outlined in the UK Government communications, would not apply to edible crab claws sold and prepared in this way. The Scottish Government understands that the export of edible crab claws under CN Tariff code 1605 is permissible.
If your business is involved in exporting non whole edible crabs to the EU, which are sold and prepared as outlined above, we recommend that you:
- The position outlined in this letter doesn’t constitute legal advice. As such you may wish to seek legal advice regarding your consignments of non-whole edible crabs to the EU.
- Contact your European Union importer, and the Border Control Point (BCP) that your consignment will enter through to ensure that they will accept your product on arrival.
The UK Government continues to hold discussions with the European Commission over the most appropriate tariff code to apply to prepared non whole edible crabs and we will continue to work with the UK Government to seek agreement with the European Union on this matter.