Your quick guide to today’s EU Brexit proposals
Draft of formal legal agreement setting down terms under which UK will leave the EU is published
What has been published today?
It is the first draft from the European Commission of the formal legal agreement setting down the terms under which the UK will leave the EU. Known as the Withdrawal Agreement, it is something which both sides need to sign up to,unless the whole Brexit process is to turn into something chaotic.
How does it relate to what was agreed in December?
It is designed to turn the December agreement on the terms under which the UK would leave into a formal legal text. The agreement before Christmas was a political one, covering the main issues relating to the UK’s departure – the mutual treatment of citizens, the UK’s financial commitments to the EU and Irish issues, including the Border. The Withdrawal Agreement is a 120-page document covering these issues and other ones relating to the UK’s departure, including the terms on which a so-called transition agreement would work. The transition period would come into force after the UK leaves the EU, but before a new agreement on its relationship with the EU is agreed and implemented – a kind of standstill during which things remain largely the same.
What are the key points on the Border?
The draft agreement tackles head on the ambiguities and fudge which allowed a deal to be reached in December. The clearest example of this relates to the Irish Border. The December agreement outlined three options to avoid the return of a trade border on the island of Ireland. The first is a future EU/UK trade deal in which the terms are sufficient to avoid a Border. The second are specific solutions which the UK would put forward, possibly involving some alignment of regulations and the use of technology.
The third – controversial – option is the so-called “backstop”, to apply if a solution is not found via the first or second routes. This is for full alignment of the North with the rules and regulations of the customs union and single market, sufficient to ensure there is no trade border. This backstop is outlined in a protocol attached to today’s legal agreement and the areas where alignment would be needed to avoid a trade border are in a separate annex. It enviages a “ common regulatory area” on the island of Ireland.
But isn’t this just a repeat of what was agreed in December? Why the fuss?
Yes, it is. However the UK government had chosen to interpret the December deal as not committing it to alignment in all rules and regulations between North and South in the backstop arrangement. The draft Withdrawal Agreement text leaves no room for ambiguity on this point. It makes clear that the backstop involves the North effectively remaining in the EU customs union, the agreement which allows goods to circulate without tariffs. Many of the rules and regulations of the EU Single Market would also have to apply in the North, as otherwise checks would be needed at the Border to ensure these rules were applied to goods entering the EU trading bloc. And the rule of the European Courts would continue to apply on these matters in the North.
Why is this so difficult for the Conservatives?
Because whatever way they turn there are problems. To avoid the backstop, the easiest route would be for the UK as a whole to remain in the EU trading bloc – the customs union and the single market. But Theresa May’s government is insistent this will not happen.
The second way for the UK to meet the Border commitment would be to accept that the North remains in the customs union and applies single market rules – at least in relation to goods. However if Britain leaves the UK trading bloc and the North stays in, then a trade Border would be needed in the Irish Sea. And in the December deal, the UK promised that there would be no barriers to trade between Britain and the North, following demands made by the DUP. The idea of a range of different rules and regulations applying in the North, as compared to the UK, as well as the potential for trade barriers has been immediately rejected by the DUP.
So we are where we were from the start – if the UK leaves the EU trading bloc, then a customs border is needed either on the island of Ireland or in the Irish Sea. One is ruled out by the EU draft and the other by the UK.
Is there scope for negotiation on the issue?
The UK is likely to continue to argue that some kind of special solution on the Irish Border will be enough to meet the commitments it made in December, referred to in the draft withdrawal text as being sufficient to “support North-South cooperation, the all-island economy and the protection of the 1998 Agreement”. However Dublin and Brussels are sceptical that there is any special solution possible, say involving technology, or that partial alignment of regulations would be sufficient. And it is clear in recent weeks that the EU side – and particularly countries like France – are insistent that if the UK leaves the customs union and single market, proper checks must be put in place on goods entering it. It is very difficult to see how this one is solved, barring a retreat by London on some of its “red lines”
What else will there be rows about?
Plenty. The text involves formalising the deal on the UK’s future financial contributions to the EU – a very touchy political point in London. And the continued jurisdiction of the EU courts over the withdrawal agreement will also be controversial. The Commission has also rejected calls from London for flexibility on the length of the transition phase, which it says must end in December 2020. Ireland, too, would have preferred the option of an extended transition to give businesses and official agencies longer to plan and adjust.
What happens next?
The EU states will make an input into the draft text. After that the key issue is whether real negotiations can get underway between the UK and the EU, given the clear political problems and the flashpoint issues relating to the Irish Border. Time is now running short. The target was to finalise a transition deal by March and the withdrawal agreement by the Autumn. And both sides have yet to scope out the bones of their future relationship on trade and other issues. The key issue now is whether the political temperature can allow the talks to move forward.