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March 9, 2020
The briefing outlines the UK and EU’s objectives, the main issues of contention and the process being followed in the negotiations. The key points from the briefing are:
- the UK Government is aiming for a relationship with the EU “based on friendly co-operation between sovereign equals”. The Government is looking for a free trade agreement with the EU similar to that which the EU has agreed with other countries, such as Canada, i.e. no tariffs or quotas on UK-EU trade (although a few tariffs remain on EU-Canada trade under their trade agreement). The UK is ruling out regulatory alignment with the EU, jurisdiction of the Court of Justice of the EU (CJEU) and supranational control over the UK in any area of the proposed agreements. In particular, the UK will not agree to be bound by “level playing field” obligations, such as, for example, rules on government subsidies to industry, workers’ rights and environmental protection;
- the UK is leaving the EU single market and customs union and, as noted, will not agree to regulatory alignment. This will allow the UK greater economic and regulatory freedom, including an independent trade policy. It will also mean, however, greater friction in relation to trade with the EU. The Government has confirmed that there will be checks on imports into Great Britain from the EU;
- the Government proposes that agreements in other areas, for example on fishing, aviation, nuclear co-operation and law enforcement and judicial co-operation, would be separate to the trade agreement;
- the Government foresees all these agreements as distinct with their own governance arrangements, as opposed to a single overarching “framework” agreement. The Government does not view foreign affairs co-operation as requiring a treaty framework;
- the EU has said it wants to have a partnership with the UK which is “as close as possible”. This would involve an economic partnership, a security partnership and co-operation on other issues. These would be under a single overarching governance structure with a dispute resolution system in which the CJEU provides interpretations of questions of EU law;
- the EU agrees that the aim of the negotiations should be to ensure zero-tariff and zero-quota trade between the UK and EU. The EU is, however, only prepared to grant this “privileged” access to its market if the UK agrees to “robust” level playing field commitments and an agreement on fisheries providing continuity in access to UK waters;
- the EU’s proposed security partnership would involve co-operation in foreign affairs and defence matters, as well as law enforcement and judicial co-operation;
- the inclusion of level playing field commitments is likely to be one of the main areas of contention. The UK argues that it is simply asking for the same type of deal as the EU has concluded with countries such as Canada and Japan. Further, the UK argues that it has used state aid less than other EU countries and has higher standards than the EU in some areas;
- the EU views the level playing field commitments as particularly important due to the size of the UK economy, its closeness to the EU and the integration between the EU and UK economies. The EU is concerned that the UK could gain an “unfair” advantage if its regulations diverge from those of the EU;
- fisheries is also likely to be a contentious area. The EU has linked access to the single market to an agreement on fisheries in which continued reciprocal access would be upheld. The UK Government negotiating objectives document proposed annual negotiations with the EU and other neighbouring countries. These would be based on the principle of zonal attachment rather than historical fishing activity, as is currently the case; and
- there are differing approaches to the proposed governance of the relationship, with the EU seeking an overarching institutional structure and the UK preferring separate agreements with their own governance structures. The role of the CJEU could be contentious, depending on whether the UK accepts a role for the court in matters of interpretation of EU law (as is the case with the Withdrawal Agreement) as distinct from an enforcement or dispute resolution role.
To access the research briefing in full, click here.