The UK government is to launch a review of the Internal Market Act. The legislation was passed in the wake of Brexit with the aim of avoiding trade barriers across the UK. The Scottish government has long opposed it, arguing it cuts across devolution. Labour Trade Policy Minister Douglas Alexander said he would engage directly with the devolved administrations in a “good faith process”. He said he had brought the review forward six months before a statutory deadline.
The UK internal market is essential for the UK economy, allowing people and business to buy and sell goods, provide services and work across the four nations of the UK. It’s crucial we protect that market whilst respecting policy divergence which comes with devolution. This UK government is committed to engaging with the devolved governments, and we recognise frustration with how the UK Internal Market Act has operated in the past, particularly the lack of clarity in terms of how it operates.
The Internal Market Act was passed by the then Conservative UK government in 2020. It set out new rules on the trading relationships between the four nations of the UK following Brexit. The Scottish government branded it a Westminster “power grab”, while the UK government described it as “the biggest transfer of powers in the history of devolution”.
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