UK and Japan make ‘in principle’ trade deal as Brexit talks continue

The UK and Japanese governments’ comprehensive deal, which requires parliamentary approval, is the first major post-Brexit UK trade deal.

The UK and Japanese governments struck a free-trade agreement on Friday which if approved by Japan's parliament would mean 99% of UK exports to Japan will be tariff-free.

The UK-Japan Comprehensive Economic Partnership Agreement, made by the UK's Secretary of State for International Trade Liz Truss and Japanese Foreign Minister Toshimitsu Motegi, is the first major trade deal the UK has made since it left the EU on 31 January.

Truss said in a press statement that the agreement goes beyond the existing EU-Japan deal. She added: "Strategically, the deal is an important step towards [the UK's] joining the Trans-Pacific Partnership and placing Britain at the centre of a network of modern free trade agreements with like-minded friends and allies."

UK manufacturers, food and drink producers, and the tech sector are set to benefit from the measures in the deal. The UK government outlined that these would include:

  • The free flow of data whilst protecting personal data. For example, UK fintech companies operating in Japan would not have the additional cost of having to set up servers in Japan.
  • Improved market access for UK financial services. The deal creates an annual dialogue between the UK government's HM Treasury, UK financial regulators, and Japanese regulator the FSA that will explore ways to reduce regulatory friction.
  • Tariff-free access for more UK goods. More liberal rules of origin will allow producers of coats, knitwear, and biscuits to source inputs from around the world for their exports to Japan.
  • Protection for more iconic UK goods. The number of "geographical indications" that show a product is linked to a particular geographical area would increase to "potentially over 70" and cover goods such as English sparkling wine, Yorkshire Wensleydale cheese, and Welsh lamb.
  • Tariff reductions for UK pork and beef exports and a range of other agricultural exports.
  • Improved mobility for business staff. The agreement would allow more flexibility for Japanese and British companies to move talent into each country. "Requirements for visas will be clear, transparent, and with an aim that they be processed in 90 days," the UK government said. A worker transferring from their UK HQ to the Tokyo office will be able to bring their spouse and dependents and stay for up to five years.

Brexit talks continue

Adam Marshall, director-general of the British Chambers of Commerce, said in a press statement that the UK-Japan deal was a "cause for celebration" but that securing a free-trade agreement with the EU remained critical for UK businesses' futures. He added: "We urge ministers to redouble their efforts to reach a comprehensive partnership with our largest trading partner at a crucial time in the negotiations."

Informal Brexit talks are ongoing, with a formal negotiating round between the UK government and the EU set for 28 September to 2 October.

Michel Barnier, the EU's chief negotiator, said in a statement he tweeted on 10 September that the UK had still not made "important guarantees on non-regression from social, environmental, labour, and climate standards", as well as guarantees on fair competition — a consistent European negotiating red line.

The EU Council meeting of the heads of member states is planned for 15–16 October, and EU officials believe the end of October is a hard deadline for a trade deal with the UK, according to The Guardian. The following two months until the end of the transition period on 31 December would be required to turn the deal into a legal treaty.

Oliver Rowe ( is an FM magazine senior editor.