Reports
Discussion Papers
No.987 Impact of Brexit on the Utilization of Regional Trade Agreements: Evidence from Japan’s Imports
January 2026
ABSTRACT
After Brexit, the rules of origin specified in the Japan-European Union (EU) Economic Partnership Agreement (EPA) disallow the accumulation of inputs from the UK. Similarly, the Japan-United Kingdom (UK) EPA does not permit the accumulation of EU inputs in the export of certain products. Therefore, Brexit could have reduced the use of preferential tariffs established by these EPAs. We investigate this hypothesis by examining the utilization rates of the Japan-EU and Japan-UK EPAs for imports from the EU and the UK in Japan from 2019 to 2024. We found that Brexit did not significantly affect the utilization rates of the Japan-EU EPA for exports from European nations to Japan. Conversely, Brexit significantly adversely impacted EPA utilization rates for exporting products that did not allow the accumulation of EU inputs from the UK to Japan. However, this unfavorable effect was observed only in the first year of the Japan-UK EPA.
Keywords: Brexit, Japan, European Union, Regional Trade Agreements, Cumulation
JEL classification: F15, F53
PDF available at https://hdl.handle.net/2344/0002001718
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