Could Blockchain Solve The Irish Border Brexit Problem?

We’ve already seen how blockchain technology can solve problems within the supply chain and financial spaces. However, blockchain is now being proposed as a solution for a more unique problem: blockchain could solve the Irish border problem looming in the United Kingdom.

In a statement on Monday, Britain’s Chancellor of the Exchequer Phillip Hammond argued that blockchain could be used to provide frictionless trade across the Irish border after Britain leaves the European Union.

“There is technology becoming available…I don’t claim to be an expert on it but the most obvious technology is blockchain,” said Hammond earlier today, as reported by Reuters. Hammond was responding to a question about how the government could facilitate smooth trade across the Irish border after Brexit.

It’s unclear how, specifically, blockchain could be used to solve the problem, and Hammond didn’t elaborate on his statement.

However, there are a number of ways blockchain could facilitate frictionless goods exchanges across the Irish border. The most obvious way would be a supply chain tracking system similar to ones already in place with blockchain today. Goods can be tracked using the blockchain, with a blockchain entry recording each step of the transfer of products across the Irish border in either direction.

This isn’t the first time that blockchain technology has been proposed as a way to solve the Irish border problem post-Brexit.

Earlier this year, The Conversation published a piece discussing how technologies like blockchain could facilitate cross-border trading in a post-Brexit world:

“Custom authorities around the world are keen to find technological means of improving efficiency. Paper forms have steadily been replaced by electronic customs declarations, which can be submitted more easily and enable quicker movement between different customs zones. For this reason, both the UK and the EU are in the process of creating fully electronic customs systems.”

Singapore revealed the world’s first blockchain-based platform for electronic certificates of origin (eCOs) earlier this year, for example. A similar technology could be used on the Irish border.

The key problem to solve here is that the UK doesn’t want to create a solid border between Northern Ireland and the Republic of Ireland. The UK government has made a commitment to have “no physical infrastructure or related checks or controls” on the border.

The problem is that the Republic of Ireland is part of the EU, which allows free movement of goods and services. How can the government prevent EU companies from moving products to the Republic of Ireland for customs-free transfers across the border into Northern Ireland? That’s where blockchain may be able to help.

Blockchain could track the movement of goods and services on the border without subjecting citizens to invasive border screenings.

Blockchain could be used to complement additional non-invasive screening technologies. Vapor analysis, for example, using neutron-activated spectroscopy has been proposed as a way for customs to detect the presence of certain chemical compounds without requiring invasive border checkpoints.

“Brexit day” is scheduled to take place on March 29, 2019, if everything goes according to plan. At 11pm on Friday, March 29 next year, the UK will officially cease to be a member of the EU, although a transitional period will be in place until the end of 2020. In a post-Brexit world, blockchain could be the technology that allows the Irish border to remain secure while allowing the UK to move forward as an independent country.

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