Brexit LIVE: Boris Johnson hands car industry to EU in trade compromise – leaked letter

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Car parts imported from countries such as Japan will not be treated as British. This means, despite being used in British cars, the parts could now receive a new tariff even if there is a free trade agreement with the EU. This bombshell for the UK car industry was revealed in a letter, sent by Lord David Frost on September 7. In the letter, Lord Frost informed industry leaders of the EU’s refusal to budge on the issue. 

He said in a letter, written on September 7, seen by the BBC: “I am sorry to say that so far they EU negotiators have neither been willing to discuss these nor share any proposed text with us.

“The commission has made clear that it will not agree third-country cumulation in any circumstances, which we regret, but obviously cannot insist upon.”

In a separate draft test, the UK negotiating team had asked for electric cars, batteries, and bikes to be treated as British, despite the majority of parts being imported. 

This comes as the controversial, UK Internal Market Bill passed a vote in the Commons on Tuesday night. 

The legislation passed its third reading, 340 to 256, and will now pass to the House of Lords. 

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7.42am update: “Leaving the EU is bad for national security” warns former MI6 boss

Sir John Scarlett, former head of the MI6, warned the UK will suffer reduced intelligence due to Brexit. 

He added there will be reduced capability to gather intelligence on terrorists, now outside of the EU. 

Sir John said: “It’s almost impossible to avoid it.

“I’m not in a position to quantify that exactly and it’s important not to exaggerate it. It’s just a fact.”

7.37am update: More on the car industry update 

Commenting on the news, the Financial Times’, Peter Foster, has provided some key insight to the news. 

He said: “On the substance this is no surprise – Barnier – been clear all along that UK can’t be allowed to become a ‘manufacturing hub’ off the coast of Europe – free of EU rules, but free to benefit.

“But the timing is interesting. It is one hand a confession of failure, but also an acceptance of it – ‘Brexit means Brexit, chaps, just like we always said’.

“If you were pessimistic you’d see this as part of the ongoing ‘pivot to sovereignty’ which underpins UK approach.”

7.20am update: UK car industry handed major Brexit blow 

Parts used in British cars, which have been imported from countries such as Japan or Turkey, will be classed as third country elements.

This means, the parts could see higher tariffs even in the case of a free trade agreement between the EU and UK.

In a letter to industry leaders, seen by the BBC, Lord Davif Frost says: “I am sorry to say that so far they [EU negotiators] have neither been willing to discuss these nor share any proposed text with us.

“The commission has made clear that it will not agree third-country cumulation in any circumstances, which we regret, but obviously cannot insist upon.”

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