What Brexit means for global automotive regulations

29 June 2016

More than three years ago, GAR posted a commentary in response to criticism of WP.29 from the Britannia Radio website. Given recent events, I thought it might be useful to review that exchange. Unfortunately, the Britannia Radio site is down, apparently compromised by malicious software. Whether this occurred before or after last Thursday’s Brexit vote, I do not know.

What I do know is that three years ago, the UK political blogger Richard North laid into WP.29, claiming that Geneva was dictating vehicle standards to a powerless British government and automotive industry. GAR responded by laying out the facts on how WP.29 operates and noting the influential role played by British regulators within the Forum.

Since then, Mr. North has been a consistent voice in support of the UK leaving the EU. The irony is that, should Mr. North get his wish, WP.29 may now protect the UK from unnecessary and potentially damaging instability as far as its vehicle regulatory system goes.

The United Kingdom joined the 1958 Agreement in 1963, which is to say nearly 10 years before Britain joined the European Economic Community in 1973, having been a founding participant in the UN Economic Commission for Europe (UNECE) from 1947. For its part, the European Union became a signatory to the 1958 Agreement in 1998, following a revision of the agreement in 1995 that made this possible.

In short, the UK, EU, and the EU member-states have a long history of cooperation on vehicle safety and environmental regulations through WP.29 notwithstanding Britain’s status within the Union. Together, the UK, European Commission, and other delegations to the Forum have built a coherent international regulatory system that will no doubt transcend the uncertainties ahead.

As international agreements under the UN, both the 1958 and 1998 Agreements enable regulators to cooperate regardless of their memberships in regional blocks like the EU. The mutual recognition of type approvals does not become inoperative because a nation is outside the EU. Should the UK ultimately exit the Union (and I make no claims to prescience on this point), its status within the global regulatory community would be little different from that of Japan whose approvals are recognized by EU signatories to the 1958 Agreement such as Germany, France, or Italy.

However, the accession of the EU to WP.29 did enable its member-states to consolidate their votes into a single voice. In this regard, should the UK leave, the EU would lose one of the 28 votes it casts when considering the adoption of proposals for UN Regulations (nothing changes on the GTR side since the voting is by consensus and the EU has one vote like any other Contracting Party). At the same time, the UK would lose some of its ability to influence these EU deliberations.

In principle, the UK would gain a modicum of independence by escaping the risk of being overridden by the EU’s “qualified majority voting” protocols. Under this system, the EU member-states decide in advance of WP.29 sessions how the European Commission shall cast their bloc vote. Disputes are rare, but not unheard of as Germany noted in the run-up to this year’s revision of the 1958 Agreement.

The UK would also have to transpose UN Regulations directly into British law rather than relying on application through the EU. The CARS-21 program resulted in the streamlining of EU vehicle safety regulations through the General Safety Regulation (GSR) of 2009. Under the GSR, EU adoption of UN Regulations swiftly translates into direct application across the EU member-states.

If the UK exits the EU, its regulators would have to handle the application of UN Regulations in Britain. Presumably this transposition would present no political concerns, but it does represent the kind of burdensome administrative undertaking that will undoubtedly bedevil civil servants for years to come should Brexit become reality. Given the importance of maintaining trade flows and the central role played by the mutual recognition of type approvals, this work nonetheless would be a vital and rather urgent matter.

Brexit presents a mind-numbing array of possibilities likely to ruin the summer vacations of Europe’s policy elites. Extracting the UK from the EU will be an arduous and painful exercise for all concerned. But from the standpoint of its impact on automotive regulatory cooperation and the running of the international type-approval system, WP.29 at least offers shelter from the storm.

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