UK/EUROPE. Last night’s overwhelming rejection of the government’s EU Withdrawal Agreement by the British Parliament has compounded the uncertainty over what form the UK’s eventual exit from the European Union will take.

With the growing possibility of a no-deal exit, otherwise known as a ‘hard’ Brexit, industry campaigners are stepping up the pressure, especially on the UK government, to ensure the platform is in place for a revival of duty free sales between the UK and EU from 29 March, when the UK is scheduled to leave the bloc.

A ‘hard’ Brexit on 29 March would mean a swift return to duty free sales between the UK and EU, subject to the alignment of UK legislation.

In a joint statement, the European Travel Retail Confederation (ETRC) and UK Travel Retail Forum (UKTRF) said they were “monitoring political developments closely and keeping in close contact with both key officials and political leaders in London, Brussels and across key capitals in Europe.”

They added: “We are planning for all eventualities including a hard Brexit, which is now a distinct possibility, and are advising all our members to do the same and to share with us any reactions they get from their own governments.

“As the saying goes, ‘a week is a long time in politics’, and we could see all sorts of political developments in the coming days.”

Assuming, as expected, that UK Prime Minister Theresa May wins a scheduled vote of confidence in the House of Commons tonight, her government will need to present a new Brexit withdrawal plan to Parliament by Monday 21 January.

The ETRC and UKTRF said they would be “using the days ahead to present our key issues to key UK ministers”, adding: “The duty free industry in both the UK and Europe can rest assured that both ETRC and UKTRF are taking all necessary steps to ensure their interests are properly represented in both London and Brussels [the EU’s de facto capital] in this key debate.”

Several pieces of legislation still require amending in Britain to ensure that duty free sales from the UK to EU states would be permitted in the event of a hard Brexit. Last November, as reported, the industry secured an announcement from the EU confirming the right to sell duty free to EU travellers to the UK once the latter becomes a ‘third country’.

Britain needs to mirror this with minor tweaks to its own customs regulations, say campaigners.

This ACI Europe infographic shows that airport traffic growth among the EU28 [EU members including the UK] in the first half of 2018 was far ahead of UK growth, at 5.4% and 2.1% respectively.

If the Withdrawal Agreement is adopted by the UK, which seems unlikely given the scale of last night’s defeat, a temporary transition period would keep Britain under the EU’s customs rules until a permanent trade deal is put in place.

This would mean no return of duty free during the transition period, which would last at least until December 2020.

Other possible outcomes include a deferral of Brexit until a parliamentary consensus emerges or a second referendum on EU membership. Either scenario would mean any return to duty free would be delayed until the outcome was clear.