The UK and EU have agreed to set up dedicated dialogues on short-term business mobility and the recognition of professional qualifications as details of the package of agreements from yesterday’s UK-EU Summit emerge.

In a statement, the government said this would create a forum to address mobility barriers faced by UK services providers in the EU. In addition, the government says it will continue to provide tailored advice to businesses to help them to navigate EU Member State requirements, including visas and work permits.

Lack of recognition hindering growth

Reinstating automatic recognition of professional qualifications was a key ICAEW ask from the summit, following concerns that changes introduced following Brexit have made it harder for companies to export their services to the EU, and are hindering growth.

In a letter to trade minister Douglas Alexander ahead of the UK-EU summit, ICAEW Chief Policy and Communications Officer Iain Wright warned that restrictions on the recognition of UK qualifications are holding firms back from growing and mean that chartered accountants and other professionals face significant requalification requirements.

Commenting on the agreement, Wright said: “The commitments made at this breakthrough summit to reinvigorate the recognition of professional qualifications is a strong success, which will help promote growth, and we’re delighted the government has listened to our repeated calls on this.

“The move will give British firms and professionals, from accountants to architects, from consultants to chartered engineers, a real advantage and help boost the sector, which was singled out as one for high growth in the new UK industrial strategy.”

According to a new report from TheCityUK the UK remains the largest and most developed market in Europe for financial-services related professional services. Accounting, management consulting, and legal services contributed £29.4bn, £16bn, and £38bn respectively to the UK's real output in 2024 and employed almost 1.4 million people including 532,000 in management consultancy and 493,000 in accountancy.

Meanwhile, ICAEW also described the agreement to work towards a balanced Youth Experience Scheme as particularly promising, given the importance of skills and mobility to economic growth. “It will open up opportunities for young people at a formative stage in their careers to benefit from European experience. The links fostered will benefit British business in the process,” Wright said.

Desire to address red tape

ICAEW’s letter to Douglas Alexander warned that restrictions on open and frictionless trade in goods and services with the EU are adding an extra burden to UK businesses at a time when the cost of doing business is already rising.

“Our members tell us that the red tape around trade is also a drag on growth, so we’re pleased there is a desire to address this and make it easier for British companies to export their services to the EU. There is now potential for greater cooperation to further reduce administrative barriers that make it difficult for business, especially SMEs, to trade across borders,” Wright said.

Details of the agreement come at a time of muted business sentiment, with business confidence turning negative for the first time since late 2022, according to ICAEW’s Business Confidence Monitor survey for Q1 2025. A sentiment reading of -3.0 on the index down from 0.2 in the previous quarter reflects forthcoming tax rises, rising inflation, weak UK growth, and increased global uncertainty.

ICAEW had called for the UK and EU to sign a mutual assistance agreement on VAT, similar to the one in place with Norway, which would remove the need for UK businesses to have a fiscal representative on the continent. Such an agreement would make companies in both the UK and EU more productive and give them more tools to stay competitive, ICAEW argued.

Emissions trading and SPS

Plans to link the UK emissions trading scheme with its EU equivalent will improve the UK’s energy security and avoid businesses being hit by the EU’s carbon tax due to come in next year, which the government says would have sent £800m directly to the EU’s budget.

The SPS (sanitary and phytosanitary) agreement – which will see a reduction in red tape on exports of animal and plant products - combined with measures to link emissions trading systems are set to add nearly £9bn to the UK economy by 2040, the government claims. Meanwhile, an agreement that will see British steel exports are protected from new EU rules and restrictive tariffs, will save UK steel £25m per year, the government says. 

Wright said: “The summit discussions were constructive and open the door to two strong trade areas working more closely together in an independent yet mutually advantageous way. We're keen to continue working with government to help develop these opportunities through joint initiatives and relationships.”