Brexit Made Simple – Issue 17, EU AND UK FUTURE RELATIONSHIP TALKS - NEGOTIATING POSITIONS

What is the issue?

The EU and UK have published separate papers outlining their negotiating positions on a range of policy issues in advance of formal talks about their future relationship.

The EU document, which stretches to 33 pages, details its views on how it will seek to agree “a new partnership with the United Kingdom of Great Britain and Northern Ireland.” Published yesterday, this has been followed up today with a nine-page “Question and Answers” document on its “draft negotiating objectives.” 

The UK Government’s position paper, also published yesterday, is in the form of a House of Commons Written Statement from Boris Johnson. It is less than four pages in length.  

What are the headlines in the EU documents?

The dominant theme is the need for so-called “level playing field” rules in any trade deal that may be reached with the UK.

The EU is prepared to offer a zero-tariff, zero-quota free trade agreement in return for the UK committing to retain EU standards on areas such as workers’ rights, animal welfare, food safety, environmental protection and state aid. EU Chief Negotiator Michel Barnier told a press conference yesterday that Boris Johnson had accepted this point when he signed the joint EU-UK Political Declaration in October 2019. It states that “the future relationship must ensure open and fair competition, encompassing robust commitments to ensure a level playing field.”

Both EU documents make clear that Brussels will not proceed with any free trade agreements without finalising a deal on fisheries. Barnier stressed yesterday that the two issues were “inextricably linked.”  The EU is determined to protect current access for EU vessels to UK waters, and to tie this to the UK’s ability to sell seafood to continental Europe. Last week, Irish Taoiseach Leo Varadkar – who faces a tricky General Election on Saturday – warned that EU market access for UK banks would also be linked to an acceptable deal on fishing. 

On services more generally, upon which the UK economy relies so heavily, the EU is seeking only a limited agreement centred on telecommunications, postal services and environmental services.

The future role of the European Court of Justice (ECJ) is also likely to be an area of fierce dispute. Barnier said the ECJ “should be able to continue its role in full.” The emphasis would be on security issues, such as extradition and data-sharing.

The EU has made clear that any future relationship deal with the UK cannot include Gibraltar.  A separate agreement would instead be required and would be subject to the approval – or veto - of the Spanish Government.  

Finally, given Boris Johnson’s insistence that he will not extend the post-Brexit transition deadline beyond the end of this year, the EU has said that the future relationship negotiations should be concluded before a scheduled European Council meeting in October. This is to allow sufficient time for all 27 EU members – and the UK Parliament - to ratify any deal reached.  

What does the UK position paper say?

It can perhaps be best described as “contrary” to the EU positions outlined above. Boris Johnson also gave a speech yesterday to add some rhetoric to the UK Government’s document.

He was dismissive of the EU’s insistence on a level playing field – despite the commitments he gave by signing the Political Declaration last October. He said yesterday: “There is no need for a free-trade agreement to involve accepting EU rules on competition policy, subsidies, social protection, the environment, or anything similar.”

On fishing, Johnson said he was ready to discuss a deal with Brussels. But he added: “Under such an agreement, there would be annual negotiations with the EU, using the latest scientific data, ensuring that British fishing grounds are first and foremost for British boats." He also said that the UK would be “an independent coastal state by the end of 2020 and any agreement must reflect this reality.”

The UK is seeking a more expansive agreement on services, particularly financial services, and demands a “predictable, transparent, and business-friendly environment for financial services firms.” Its document adds: “There should be measures that reduce unnecessary barriers to trade in services, streamlining practical processes and providing for appropriate regulatory cooperation.” Of interest to vets, the position paper also calls for “the mutual recognition of UK and EU qualifications, underpinned by regulatory cooperation, so that qualification requirements do not become an unnecessary barrier to trade.”

The UK rules out any ECJ jurisdiction “over the UK’s laws, or any supranational control in any area, including the UK’s borders and immigration policy.”

On Gibraltar, Johnson said that his team would be “negotiating on behalf of the entire UK family,” including Gibraltar.  

And the UK document states that there is “complete certainty that, at the end of 2020, the process of transition will be complete.” 

Are there any areas of agreement?

A few but not many.

The most noteworthy – and worrying – is that both sides accept the trade talks could end without agreement. Barnier said yesterday: “If we can’t manage a deal by the end of the year, there will be a cliff-edge on many fronts.”

Meanwhile, Johnson claimed that the UK would happy to accept an “Australian-style arrangement” with Brussels. However, given that the Australian Government does not have a free trade agreement with the EU, this is a thinly-veiled threat of no-deal.   

What happens next?

The EU’s “draft negotiating directives” are subject to a series of approvals in the coming weeks. Following a final sign-off by the European Council (of EU Leaders) which is expected by the end of the month, the first formal meeting between EU and UK negotiators is likely to take place at the beginning of March.

Dr Jason Aldiss BEM

Managing Director, Eville & Jones

4 February 2020

You can follow me on Twitter @JasonAldiss