New post-Brexit border controls to cost businesses £330m a year
New post-Brexit border controls on animal and plant products imported from the EU will cost businesses £330m a year in extra charges, the government has admitted.
Lucy Neville-Rolfe, a minister of state in the Cabinet Office, confirmed the figure in a letter seen by Sky News to Labour MP Stella Creasy, who chairs the Labour Movement for Europe.
On the costs of the new Border Trade Operating Model (BTOM), which will be phased in from January 2024, Baroness Neville-Rolfe wrote: “It will depend greatly on how businesses adapt their business models and supply chains to integrate the new controls regimes. We estimate these new costs of the model at £330m pa [per annum] overall, across all EU imports.”
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It comes ahead of a speech by Business and Trade Secretary Kemi Badenoch at the Conservative Party Conference on Monday, who will claim opponents of Brexit are “relentlessly wanting to talk down our country” and insist that while there are challenges posed by Brexit, “we are working to fix them”.
From January, European businesses exporting plant and animal products to the UK will have to submit extra paperwork known as health certificates, with physical checks costing up to £43 coming into force from April.
The checks – which have been delayed repeatedly since the Brexit deal came into effect in January 2021 – were due to start this month but were pushed back in August amid warnings the strategy risks further pushing up food prices.
The government has admitted the new system will add to inflation, but said this will be “minimal” at less than 0.2% over three years.
In her letter, Baroness Neville-Rolfe said the checks were required because since the UK left the EU “we have not had full biosecurity checks in place”, meaning it has become “more challenging to intervene to combat threats to animal, plant and human health”.
She pointed to the spread of pests and diseases across Europe – such as African Swine Fever – adding it would be “dangerous to underestimate the huge costs both to lives and livelihoods that an outbreak of these diseases could cause to the UK”.
The cabinet minister went on to to say that “around half” of the £330m figure is estimated to be on health certification, but this was a “saving” of £520m compared to a previous model that was going to be introduced in 2022.
However Ms Creasy suggested this was disingenuous as if the UK had not left the EU there would be no extra costs at all.
Stella Creasy chairs the Labour movement for Europe
She said: ‘The government thinks it can get away with presenting red tape worth £330m as a good news story because it could have been higher- forgetting that its all extra costs that businesses can ill afford when they have already had a massive increase in red tape thanks to Brexit.
“British companies struggling with border paperwork to import food will have little choice over these charges meaning it’s likely British consumers will have to pick up the bill. Ministers need to urgently rethink for the sake of all those already suffering in the cost of living crisis.”
Industry bodies have repeatedly warned the government’s new model would likely push up prices as businesses would not be able to swallow the associated costs.
But on the other hand the National Farmers Union (NFU) said the lack of controls put them at a commercial disadvantage as British exports to the EU have been subject to health and safety checks for three years “while the EU has enjoyed continued easy access to the UK marketplace.”
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The checks on EU imports are legally required under the terms of the Brexit trade deal with the EU.
The BTOM, which will be a global regime, aims to use more technology and digitisation to reduce bureaucracy than under the original import model devised post-Brexit.
William Bain, head of trade policy at the British Chambers of Commerce, said: “If the border plans result in fast and effective controls, allowing the UK to take advantage of new digital trade arrangements, then additional costs will be slightly easier to swallow.”
However he added: “Coming in the middle of a cost of living crisis, and with inflation still high, we would urge the government to consider ways to mitigate this huge expense”, suggesting the inspection charges would be “a good place to start”.
The checks are one of 20 new major policy changes between now and the end of 2024 that will impact British companies that trade internationally, according to the Institute of Export & International Trade.
Marco Forgione, the organisation’s director, said the digitalisation of UK trade has the potential to add £25bn to the country’s GDP but businesses need certainty and support.
“The government cannot defer or delay any longer. They set out a timetable. They’ve got to stick with it,” he told Sky News.
Democratic leaning organizations and members of Congress have announced plans to protest what they describe as the sale of access to the office of the US president, in reference to Donald Trump’s memecoin dinner on May 22. The event’s attendees are said to have collectively spent over $100 million for the chance to meet with the US president.
Since Trump’s memecoin project, Official Trump (TRUMP), announced that its top 220 tokenholders would have an opportunity to apply for an exclusive dinner with the president, many leaders in the crypto industry and US lawmakers have criticized the event, saying Trump was opening his office to potential bribery and corruption.
The memecoin dinner prompted some Democratic lawmakers to withdraw support for crypto-related legislation in Congress, including the market structure and stablecoin bills.
“Trump collecting gifts from foreign governments is unconstitutional,” a spokesperson for the consumer advocacy organization Public Citizen, which is planning to protest near the memecoin dinner on May 22, told Cointelegraph. “Collecting foreign government investments through his memecoin is not much better. American foreign policy should not be for sale.”
Crypto industry figures such as Tron founder Justin Sun, Kronos Research chief investment officer Vincent Liu, Hyperithm co-CEO Oh Sangrok, and Synthetix founder Kain Warwick are among the tokenholders expected to attend the dinner at the Trump National Golf Club outside Washington, DC. The memecoin project said all applicants had to pass a background check and could not be from a “[Know Your Customer] watchlist country.”
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Public Citizen, in partnership with progressive political organization Our Revolution, will hold a rally near the golf club, which Oregon Senator Jeff Merkley is expected to attend. In addition, the Arlington and Loudoun Democrats will be hosting a separate event to urge US officials to “hold [Trump] accountable,” and Democratic leadership in Congress has scheduled two press events on May 22 ahead of the dinner.
“Americans cannot and will not accept President Trump’s view that positions of power exist only to benefit the holder of that power,” Ryan Ruzic, chair of the Loudoun County Democratic Committee, told Cointelegraph. “We have a moral responsibility to speak out against corruption, whatever the result may be.”
Pushback on TRUMP memecoin affected crypto legislation
Some lawmakers initially cited the memecoin dinner and the Trump family’s involvement with the crypto platform World Liberty Financial in opposing passage of the GENIUS Act, a bill to regulate payment stablecoins. World Liberty Financial began issuing its own USD1 stablecoin in March, prompting concerns about Trump’s conflicts of interest. However, the legislation passed a key procedural vote in the Senate on May 19 with support from Democrats, setting the bill up for debate in the chamber.
“Many senators, myself included, have very real concerns about the Trump family’s use of crypto technologies to evade oversight, hide shady financial dealings, and personally profit at the expense of everyday Americans,” said Sen. Mark Warner in a statement before the May 19 vote, adding: “But we cannot allow that corruption to blind us to the broader reality: blockchain technology is here to stay.”
Senator Chris Murphy, who voted against advancing the GENIUS Act, called for bipartisan support in amending the bill to specifically bar a US president from issuing stablecoins. He also called on the White House to release a complete list of attendees to the memecoin dinner, suggesting that some or all of them would “try to get something from the president” in exchange for purchasing the tokens.
Murphy and Senator Elizabeth Warren will attend a press event with representatives for Public Citizen on May 22. California Representative Maxine Waters, ranking member of the US House Financial Services Committee, announced a separate press conference for the same day, with plans to introduce a bill to “block Trump’s memecoin and stop his crypto corruption, once and for all.”
As of May 21, the exact number of attendees to the dinner was unknown. A smaller group of 25 tokenholders also qualified to apply for “VIP tour” and reception — presumably at the White House — with Trump, but the complete list of those planning to attend was also unknown at the time of publication.
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The Texas House of Representatives has passed the third reading of SB 21, a bill that seeks to establish a strategic Bitcoin reserve in the state. The bill passed in a 101-42 vote and will now go to Texas Governor Greg Abbott to either sign into law or veto.
SB 21, authored by state Senator Charles Schwertner, establishes a Bitcoin (BTC) reserve that is managed by the state’s comptroller. The legislation allows the comptroller to invest in any cryptocurrency with a market cap above $500 billion over the previous 12-month period. Currently, the only cryptocurrency fitting the requirement is Bitcoin.
Before the vote, state Representative Giovanni Capriglione said to the chamber that the bill was a “pivotal moment in securing Texas’s leadership in the digital age with the passage of our strategic Bitcoin reserve. Now, we embrace a modern asset with traditional properties for future promise.”
This is a developing story, and further information will be added as it becomes available.
Stablecoin adoption among institutions could surge as the United States Senate prepares to debate a key piece of legislation aimed at regulating the sector.
After failing to gain support from key Democrats on May 8, the Guiding and Establishing National Innovation for US Stablecoins (GENIUS) Act passed the US Senate in a 66–32 procedural vote on May 20 and is now heading to a debate on the Senate floor.
The bill seeks to set clear rules for stablecoin collateralization and mandate compliance with Anti-Money Laundering laws.
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“This act doesn’t just regulate stablecoins, it legitimizes them,” said Andrei Grachev, managing partner at DWF Labs and Falcon Finance.
“It sets clear rules, and with clarity comes confidence. That’s what institutions have been waiting for,” Grachev told Cointelegraph during the Chain Reaction daily X spaces show on May 20, adding:
“Stablecoins aren’t a crypto experiment anymore. They’re a better form of money. Faster, simpler, and more transparent than fiat. It’s only a matter of time before they become the default.”
Senate bill seen as path to unified digital system
The GENIUS Act may be the “first step” toward establishing a “unified digital financial system which is borderless, programmable and efficient,” Grachev said, adding:
“When the US moves on stablecoin policy, the world watches.”
Republican Senator Cynthia Lummis, a co-sponsor of the bill, also pointed to Memorial Day as a “fair target” for its potential passage.
Grachev said regulatory clarity alone will not drive institutional adoption. Products offering stable and predictable yield will also be necessary. Falcon Finance is currently developing a synthetic yield-bearing dollar product designed for this market, he noted.
Yield-bearing stablecoins now represent 4.5% of the total stablecoin market after rising to $11 billion in total circulation, Cointelegraph reported on May 21.
Related: Stablecoins seen as ideal fit for real-time collateral management
GENIUS Act regulatory gaps don’t address offshore stablecoin issuers
Despite broad support for the GENIUS Act, some critics say the legislation does not go far enough. Vugar Usi Zade, the chief operating officer at Bitget exchange, told Cointelegraph that “the bill doesn’t fully address offshore stablecoin issuers like Tether, which continue to play an outsized role in global liquidity.”
He added that US-based issuers will now face “steeper costs,” likely accelerating consolidation across the market and favoring well-resourced players that can meet the new thresholds.
Still, Zade acknowledged that the legislation could bring greater “stability” to regulated offerings, depending on how it is ultimately worded and enforced.
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