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Boris Johnson’s top ethics adviser Christopher Geidt resigned Wednesday night — and his exchange of letters with the prime minister claims that the row centers on the Trade Remedies Authority, the independent, post-Brexit watchdog meant to police trade disputes.
While the details of the clash are still emerging, it’s not the first time the TRA has felt the political heat, as Emilio Casalicchio first reported for POLITICO Trade pros.
READING, England — In a 1990s era office in the English market town of Reading, trade officials are obsessing over ironing boards.
The U.K. anti-dumping team is working out whether imports of the household items from the Turkish equivalent of free ports are causing unfair harm to their British-produced counterparts.
It might sound trivial, but it’s the work the Trade Remedies Authority was set up to do after Brexit.
“Our mission is to protect U.K. economic interests from unfair international trade practices,” explained Chief Executive Oliver Griffiths during an interview in an office meeting room overlooking a roundabout.
That means hearing complaints from British companies who argue their products are being undercut due to unfair trade practices, investigating those complaints and recommending defensive measures to the government — most often in the form of new tariffs.
When Britain left the European Union, not only did it start negotiating new trade deals, it also had to agree a system for managing existing trade.
The role of the trade remedies authority in that new system is still somewhat debated, 12 months after it started operating. Some experts say the body is now weaker than its counterparts in the EU and the U.S., making Britain’s trading system more political.
The government delivered a blow to its independence in the wake of its first recommendation last June and launched a wide-ranging review into its powers. The review was meant to be quick, but is still ongoing.
Following a probe about whether EU measures to protect domestic steel should be retained in the U.K. after Brexit, the TRA recommended ditching the protections on a number of items. But Liz Truss, who was trade secretary at the time, overruled the suggestion on five of those products after intensive campaigning from the British steel sector.
The move meant re-writing the rules, seeing as the government was originally allowed to accept or reject TRA recommendations but not pick and choose in this way.
“It was uncomfortable, undoubtedly,” Griffiths said. “I don’t think the government was in any doubt that we would have preferred a situation where our recommendation was taken on.”
Holding the tariff levers
In the wake of Truss’s move, the question looming over the TRA is whether increased ministerial discretion will be baked into its operating model.
Indeed, since the review was launched, Truss’s successor as international trade secretary, Anne-Marie Trevelyan, also seized further powers from the TRA to take charge of other investigations into whether EU measures should be retained.
The TRA already has less independence from politics than its EU and U.S. counterparts. In the EU, the European Commission can adopt trade defense measures without approval from member countries, who can block measures, but face a high voting threshold to do so.
In Washington, one government office calculates the extent of foreign dumping and subsidies, while another determines the harm to domestic producers. If the latter does find harm, protections kick in without the need for political sign-off.
In Britain, on the other hand, the TRA can make recommendations but it’s up to the government minister to decide what action to take in response. That minister can adopt the proposals, reject them or pick and choose, and in the case of retained measures can even take the investigation in house.
Griffiths is sanguine about the prospect of further ministerial encroachment on TRA territory as a result of the review. “We’ll just continue to serve up what we think is the right answer and the best recommendations we can,” he said. “And if there are options to have political overrides and so forth, then fine.”
Those political overrides are crucial for a government eager to retain public support in former industrial heartlands it won for the first time at the last election.
John Kirkpatrick, the director of investigations at the TRA, said the office exists to establish the raw facts of a case from an economic perspective. “None of that takes much account of a political dimension,” he added. “Which is why ministers reserve for themselves the opportunity to apply a public interest test beyond what we’ve done.”
A life of trade
It’s little surprise Griffiths is relaxed about the political dimension. He understands it well after a career working in trade, including as a top British negotiator.
At university he focused his studies on the 1846 repeal of the protectionist corn laws in Britain. It was a passion he used to chat about with Truss while she was in the department. He also did a masters in protectionism and later worked on the doomed Doha round at the World Trade Organization and led the negotiations with the U.S. on the now frozen free-trade agreement between Washington and London.
Now, his interest in trade has brought him to a riverside town a world away from the buzz of Whitehall. The TRA office’s white grid ceiling, patterned carpets and smattering of freestanding water coolers would be found in offices in any English market town. It occupies a floor in a government building otherwise full of farming department officials sending rural subsidies to landowners.
But the work, according to the investigators, is far from dull. They spend their days chasing overseas exporters to understand their business models, crunching numbers on industrial damages and visiting factories to understand their costs.
“It’s really interesting, because a lot of the time you haven’t been in these sort of factories before,” Simon Macleay, one of the head investigators, said about the site visits. Recalling one trip during a probe about biodiesel, he added: “It definitely smells when they bring the raw material in, because it’s all waste and fatbergs and stuff like that.”
Others prefer drawing the final factsheets and recommendations together after investigations that usually last more than a year. “That’s when you see it all come together and see answers to questions you’ve been asking for months,” said Harriet Smith, another head investigator.
Kirkpatrick, the investigations director, said the visits can bring home the impact of the TRA’s role. “If you actually go and stand beside a process in a factory,” he explained, “the importance of the cost of energy, the importance of the cost of aluminium to the process, really stares you in the face.”
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