Last reviewed 1 July 2022
A sixth wedding anniversary is traditionally called the iron anniversary and, as 23 June marked six years since the UK voted to leave the European Union, that seems a suitable symbol to indicate the present state of relations between the two.
Another month has passed without any significant attempt at negotiation; indeed it has been marked more by legal threats than by any attempt at flexibility. The Northern Ireland Protocol is still casting a long shadow with neither side, as yet, prepared to compromise.
The Government has repeatedly threatened to take unilateral action to amend the Protocol if it could not agree the necessary changes with the European Commission, arguing that this would be legal under the agreement’s Article 16. This states: “If the application of this Protocol leads to serious economic, societal or environmental difficulties that are liable to persist, or to diversion of trade, the Union or the United Kingdom may unilaterally take appropriate safeguard measures.” The Government says that moving goods between Great Britain and Northern Ireland represents just such a serious economic problem; the EU responds that the systems were clear when the UK signed the Protocol and why is it no longer the “oven-ready deal” that Prime Minister Boris Johnson hailed at the time.
On the one hand, the Government argues that the Commission has no reason to worry about goods coming from Great Britain possibly entering the EU single market via Northern Ireland because UK manufacturers are mainly working to standards introduced through EU law. On the other, Brexit Opportunities Minister, Jacob Rees Mogg, is repeatedly reported as saying that he wants to tear up those inherited regulations and replace them with ones designed purely for UK needs.
May I have the Bill?
Given this seeming impasse, the Government decided to raise the stakes and has introduced proposed legislation to amend the Protocol. It stressed that this would continue to protect the delicate balance of the Good Friday Agreement while providing “robust safeguards” for the EU single market. Under the Northern Ireland Protocol Bill, the Government has argued that it will be able to address the practical problems the Protocol has created in Northern Ireland in four key areas: burdensome customs processes; inflexible regulation; tax and spend discrepancies; and democratic governance issues.
Foreign Secretary (and chief Brexit negotiator), Liz Truss, said: “This is a reasonable, practical solution to the problems facing Northern Ireland. It will safeguard the EU single market and ensure there is no hard border on the island of Ireland. We are ready to deliver this through talks with the EU. But we can only make progress through negotiations if the EU are willing to change the Protocol itself — at the moment they aren’t”.
The Bill aims to create green and red channels to remove unnecessary costs and paperwork for businesses trading within the UK, while ensuring full checks on goods entering the EU. Businesses will have the choice of placing goods on the market in Northern Ireland according to either UK or EU goods rules, to ensure that Northern Ireland consumers are not prevented from buying UK standard goods, including as UK and EU regulations diverge over time. In addition, it will aim to ensure that Northern Ireland can benefit from the same tax breaks and spending policies as the rest of the UK, including VAT cuts on energy-saving materials and Covid recovery loans.
The proposed legislation will also “normalise governance arrangements” so that disputes are resolved by independent arbitration and not by the European Court of Justice (CJEU). For those arguing that the move would breach international law (who include former Prime Minister Theresa May), the Government has published the legal advice that it received (https://www.gov.uk/government/publications/northern-ireland-protocol-bill-uk-government-legal-position/northern-ireland-protocol-bill-uk-government-legal-position) which argues to the contrary.
The Foreign, Commonwealth & Development Office has published a policy paper setting out the problems associated with the Protocol and the Government’s proposed solutions which can be found here.
None of this has been well received by the European Commission which has insisted that it has already made several concessions to ensure that the Protocol is working. It has warned of legal action if the UK persists with moves to unilaterally amend the Protocol. To add to tensions between the two, this could mean pursuing the case through to the CJEU — the court which the UK wants to remove from having any role in ruling on disputes between the parties to the Protocol.
Commission negotiator Maros Sefcovic said there was “no legal or political justification whatsoever for unilaterally changing an international agreement. So let's call a spade a spade, this is illegal”. As well as restarting the court action it paused in March 2021 to allow for further talks, the Commission has also launched two new proceedings over claims the UK has failed in its obligations to share trade data and set up border inspection posts.
More worryingly, it has indicated that it might bring forward sanctions against the UK including the suspension of the post-Brexit Trade and Cooperation Agreement (TCA). However, both sides have time to reconsider their position given that the path to the CJEU is a long slow one while it could take a year for the Bill to be adopted as, while it already had its First Reading in the Commons, it now faces strong opposition in the House of Lords.
The Commission has published a factsheet setting out what it describes as concrete examples of the benefits of the Protocol. Available at https://ec.europa.eu/info/system/files/benefits_of_package.pdf, this includes case studies such as a truck transporting different food products (dairy, meat, fish, confectionary, fruit and vegetables, for example) from Great Britain to Northern Ireland now needing only one certificate stating that all goods of different types, class or description meet the requirements of EU legislation.
It seems increasingly likely that British scientists will be unable to accept grants from the EU’s Horizon research fund as the European Commission has said that the possibility of the UK retaining associated status with the programme will not be confirmed until the long-running impasse over the Northern Ireland Protocol is resolved. This could prove a significant problem for research scientists as the UK was one of the primary beneficiaries of Horizon Europe funding between 2014 and 2020, being awarded £1.5 billion.
The Government has been warned that several leading scientists are planning to move their research programmes to one of the EU Member States to protect their funding and to maintain the ability to co-operate with other research teams across the continent. This is despite an offer from Ministers to replace Horizon funding with fellowships named after leading Britons such as David Attenborough and Tim Peake. While this could see billions poured into UK research, there have been concerns that a new, purely domestic, scheme will lack the international reputation of a long-running multinational programme such as Horizon.
UK set to scrap EU GSP?
In July 2021, the Government launched a consultation into the way it trades with developing countries under the UK Generalised Scheme of Preferences (GSP). This is essentially a scheme inherited from the EU, with a few minor changes, but the proposal under consideration was to replace it in 2022 with a new Developing Countries Trading Scheme (DCTS). This would initially apply to 70 qualifying countries and would include improvements such as lower tariffs and simpler rules of origin requirements for developing countries exporting to the UK.
According to the Department for International Trade (DIT); respondents were generally in favour of the policy proposals suggested in the “Statement of Direction”, which accompanied the launch of the consultation. Suggesting a simpler, more generous, pro-growth approach to trading with developing countries, this can be found
here. “More time is now needed to fully assess the implications of the policy options taking account of the consultation responses,” the DIT said and nothing further has been heard about the scheme. That is until 24 June 2022 when, speaking at a Commonwealth Heads of Government Meeting in Rwanda, Prime Minister Boris Johnson confirmed plans to launch the DCTS “in the coming weeks”.
One thing has been made abundantly clear in the six years since the referendum and that it is that the political trumps the economic when it comes to arguments about Brexit. At the time of writing, the Prime Minister is under continued pressure to “consider his position” and his claim to have got Brexit done, and his refusal to give way to pressure from Brussels, remain significant strengths in the eyes of his supporters. He is unlikely to damage that perception by offering to compromise with the EU.
Should he be forced out then his possible successors will come under the spotlight with one, almost certainly, being Liz Truss. As the present Brexit negotiator, she is certain to maintain an unyielding position in order to secure the backing of Leave-supporting MPs and voters. It may take to the seventh anniversary to see any resolution to these problems.