The main points of 19-page paper by European Research Group include checks away from the border and exemptions for SMEs

There is little new in the European Research Group (ERG) paper on the Irish border.

It does not have any big breakthrough idea, it does not have a text on a potential backstop and its proposals do not involve EU checks in British ports.

It relies on checks away from the border, mutual recognition of standards, data sharing and electronic customs pre-clearance.

Quick guide Who are the main pro- and anti-Brexit groups? Show Hide Pro-Brexit - European Research Group The long-established coalition of Brexit-minded Conservative MPs – though it publishes no list of members – led by Jacob Rees-Mogg, and one of Theresa May’s main obstacles in parliament. Leave Means Leave Headed by the businessman Richard Tice, and newly joined by Nigel Farage, this group seeks a Brexit completely outside any single market, customs union or EU oversight. Change Britain The successor group to the official leave campaign, it is headed by Labour MP Gisela Stuart, and says it wants to see the referendum result “respected and delivered in full”. Stand Up 4 Brexit A new group campaigning to sink May’s Chequers proposals, which claims the support of 20 Tory MPs, among them Priti Patel and Iain Duncan Smith. Leave.EU The unofficial leave campaign, financed by Arron Banks, which faces scrutiny about its tactics and funding. These days mainly a Twitter feed that mixes Brexit news with far-right-friendly messages about immigrants and Islam. Soft Brexit/remain - Open Britain Springing up in the wake of the referendum, this grouped MPs from various parties in pushing for a soft Brexit. It was supported by some Tories, such as Anna Soubry and Dominic Grieve, but they cut ties over a plan to oust hard Brexit-backing MPs. Best for Britain A later arrival, chaired by the former Labour minister Mark Malloch-Brown, this is more directly opposed to Brexit itself, and has received funding from the billionaire George Soros. People's Vote Part of Open Britain, this group calls for a referendum on the final Brexit deal. European Movement A long-established pro-EU group with sections across Europe, this has had a lower-profile role in the Brexit aftermath. Chaired by ex-Conservative cabinet minister Stephen Dorrell. Our Future Our Choice Set up by and seeking to represent young people, the group organises protests, and is probably best known for its eloquent spokesman Femi Oluwole. For Our Future’s Sake Going by the handy acronym of FFS, this is a student-based group seeking to block Brexit. Scientists for the EU A self-explanatorily named niche pressure group with a heavyweight set of scientific backers.

The 19-page paper sets out a regime similar to that proposed by the UK government, relying on electronic customs declarations, “trusted trader” status for big business and exemptions for small businesses.

Here are the main points.

The Good Friday or Belfast agreement

What the ERG says: It attacks the European commission for listening too much to Ireland’s taoiseach, Leo Varadkar, and says it “must seek to learn more from respected voices in Northern Ireland”.

“It is now accepted that the EC has made a major error in taking advice on matters relating to the island of Ireland almost solely from Dublin,” it says. It takes a swipe at Varadkar, claiming the “refusal” to engage in discussion about “a workable technological solution” is in “contrast to the previous cooperative and practical approach of Enda Kenny”, his party colleague and predecessor.

It says the draft withdrawal agreement “is a clear breach of the principle of consent” enshrined in the agreement.

What the commission and Kenny have said: Border issues are not so much about trade but about the “normalisation” brought about by the flourishing cross-border trade after the peace agreement, the commission argues. The dispute about the border is a “human” issue and anything that creates divisions in communities where peaceful relations are still a work in progress is to be avoided.

In June Kenny said he was appalled by what was happening in British politics. “The government is driven by internal dissent, lacks credibility and clarity in the most serious issue in decades,” he said.

Jacob Rees-Mogg and the shadowy group of Tories shaping Brexit Read more

Checks in British ports

What the ERG says: There is no mention of having EU staff at British ports to examine goods going from Liverpool and Holyhead to Northern Ireland via Dublin. This had been expected in the paper but the former Brexit secretary David Davis said it was unacceptable.

What the commission has said: The EU’s chief Brexit negotiator, Michel Barnier, was hoping to “de-dramatise” the Irish border issue with checks on goods going from Britain to Ireland at British ports.

Checks on agricultural goods 20km from border

What the ERG says: The EU allows inspection posts examining everything from livestock to agrifood to be conducted 20km from Rotterdam docks. “To avoid congestion at the docks, goods are transported to these points under transit declarations and only released into the internal market once they have been given veterinary approval at the border inspection posts,” it says.

The union customs code (UCC) already allows for inland clearance, with transit declaration formalities done at a business’s premises.

What the commission has said: Michel Barnier told the Brexit select committee last week that checks “could take place in different places, onboard vessels, in ports outside Ireland.” But the commission has explicitly rejected an economic buffer zone 20km on either side of the border. It repeated this in its meeting with Rees-Mogg and other members of the Brexit select committee last week.

Cross border trade and small business waivers

What the ERG says: It is seeking to maintain drive-through borders with no checks on any business signed up to an authorised economic operators international scheme and other off-border checks or waivers for small businesses.

The paper acknowledges that the vast majority of goods that cross the border are through small- to medium-sized business. These could be dealt with. Small traders form a significant proportion of cross-border traders. It has been estimated that there are only 53 businesses in Northern Ireland exporting goods to the Republic of Ireland which employ more than 250 people. 92% cent of cross-border businesses employ fewer than 50 people.

The paper comes close to the EU’s position when it points out that the small businesses “may not amount in aggregate to a huge economic value, but such transactions are most important in human terms”.

Its solution is based on technology: “Existing electronic procedures allowing declarations ahead of travel and any necessary physical inspections at the exporters’ or importers’ premises.”

What others say: Seamus Leheny, of the Freight Transport Association, a key organisation on this issue, points out that the paper does not take account of “inter-company” freight, which involves parts of goods from both sides of the border.

The EU has already rejected a deal to wave through small- to medium-sized companies’ exports to Ireland from Northern Ireland as it could not police or govern standards across the border. Most businesses would conform but it would only take a few to bring the scheme into disrepute, potentially forcing the EU to shut it down and insist on checks long after negotiations.

Brexit secretary under fire from Michel Barnier over Irish border issue Read more

Customs declarations

What the ERG says: Cross-border trade mostly comprises regular shipments of the same goods. One example is Guinness, brewed in Dublin, bottled in Belfast, transported back to Dublin Port and shipped to UK. Big business is well suited to “trusted trader” status with exemptions for small business.

What the commission has said: This proposal is similar to Theresa May’s proposal last August, which was rejected by the EU. More than 14,000 commercial vehicles cross the border daily. Random controls for smuggling and sub-standard goods carried out on even 1% of traffic would mean significant border checks.

Northern Irish border and trade

Just 4.9% of Northern Ireland sales are with the Republic. After domestic trade, the biggest trading partner (20%) is Great Britain. The Irish Republic’s greatest trade is also with mainland Britain.

What Ireland has said: Ireland has consistently acknowledged that its biggest trading partner is Britain and a bad deal for the UK is a bad deal for Ireland.

Trade figures do not take into account inter-company movements across the border, whereby goods are products of ingredients or parts sources on both sides of the border. Mushrooms produced in Monaghan destined for British supermarkets are grown in special compost developed across the border in Armagh, for example.

Customs technologies

What the ERG says: Computer-based customs clearing is the norm across the world, with forms filled out online and uploaded to customs authorities before transit. Only 4% of UK imports are subject to checks.

What others say: Customs declarations forms can be pre-checked easily with goods coming from outside the EU because they can be lodged days or weeks before transit. It is not appropriate for casual border freight in small cross-border communities such as bakeries, dairy farms etc.

VAT

What the ERG says: VAT is one of the big issues post-Brexit. The ERG acknowledges there is a high degree of compliance even “on this sensitive border and where there is a fiscal incentive to cheat”. The paper suggests the UK could ask to stay in the EU information exchange system.

What others say: At least they are thinking of the issues, but big differentials in VAT will mean smuggling becomes the norm. At the moment VAT in Northern Ireland and the UK is 20%, against Ireland’s 23%, but there are calls to reduce it to 5%. This would mean a bigger and bigger parallel economy with shoppers and businesses going across the border without recording transactions, meaning the Irish exchequer risks VAT and trade revenues.