What happened on Tuesday with the Northern Ireland protocol?
British foreign secretary Liz Truss announced plans to introduce legislation in the coming weeks to scrap parts of the Northern Ireland protocol, the part of the 2019 EU-UK Brexit divorce deal designed to prevent the return of a hard border on the island of Ireland.
Why has the UK government done this?
Boris Johnson's government said the protocol has put the Belfast Agreement, Northern Ireland's 1998 peace deal, "under strain" because it does not have the support of both the North's unionist and nationalist communities and has prevented the establishment of a new power-sharing government in Belfast because Unionist parties oppose it. Unionists say it has damaged Northern Ireland's place in the UK, while the North's businesses say it has added costs and delays because of the administrative burden from filling out additional paperwork to comply with trade rules.
Why are checks required?
The UK has departed the EU but the Brexit deal left Northern Ireland under EU single market rules for goods, including strict regulations for food products travelling into Northern Ireland from Britain. The checks are required to permit Northern Ireland to remain in the EU single market and the UK internal market so that goods can cross freely, north-south, without checks at the Irish land border.
What is the UK government’s problem with these checks?
Truss said that even though the full checks have not been introduced because of grace periods and “easements”, EU customs procedures mean that some businesses have stopped trading across this new Irish Sea border, while UK food producers are facing “onerous restrictions,” including the requirement for veterinary certs in order to sell food products in Northern Ireland’s shops.
What does the UK government want?
London is seeking a negotiated resolution with the EU but says proposals tabled by EU Commission vice-president Maros Sefcovic last year do not go far enough. Truss said the UK government believes that some of these proposals would even make matters worse. She said the EU's mandate does not allow the protocol to be changed to address the UK's concerns.
So what is Johnson’s government proposing to do?
It plans to pass legislation that would allow the UK to bypass parts of the protocol so businesses trading across the Irish Sea would not have to comply with checks and paperwork.
What changes does London want?
The main change relates to the treatment of goods crossing from Britain into Northern Ireland that remain in the North. The UK government does not believe that these should be subject to EU rules given that goods are passing from one part of the UK internal market to another part. It is proposing to create a new “green channel” to free goods moving and staying within the UK “of unnecessary bureaucracy” with the EU’s mandatory checks removed for these goods.
A trusted trader scheme would provide the EU with real-time commercial data to offer guarantees to Brussels that goods intended for Northern Ireland do not move south of the Border into the Republic and the EU single market. Goods moving onwards to the Republic would still face full checks through a "red channel". To punish rule-breakers, "robust" penalties will be imposed.
What happens to EU rules and standards applying in Northern Ireland?
The UK government is proposing to create a “new dual regulatory regime” so that businesses can choose between meeting either UK or EU standards. This would remove regulatory barriers to goods made in Britain being sold in Northern Ireland.
What other changes is the UK government proposing?
London wants the ability to decide on tax and spend penalties in Northern Ireland. Under the protocol, Northern Ireland is subject to EU VAT rules on goods that, for example, prevented a planned UK government VAT cut for solar panels and other energy saving materials being extended earlier this year to Northern Ireland.
Truss told parliament that the UK wanted changes to subsidy control and governance “in line with international norms” but did not get into specifics. This points to the UK government’s long-running grievance over the European Court of Justice having oversight in disputes on how the protocol is operated. Truss is also proposing to consult businesses and people in Northern Ireland before any changes are made to the protocol.
How have Dublin and Brussels reacted?
Neither the Irish Government or the EU Commission are happy. Minister for Foreign Affairs Simon Coveney said he deeply regretted the UK's plan to take unilateral action to "disapply" parts of an internationally binding agreement. This would damage trust and would "serve only to make it more challenging to find solutions to genuine concerns" in Northern Ireland, he said.
Sefcovic said the EU had “significant concerns” about the UK’s move and warned that, should the UK proceed with its legislation, the EU will need to respond “with all measures at its disposal.” This could amount to a fresh legal action by the EU against the UK or the start of a potential trade war with retaliatory tariffs on symbolic British goods such as Scottish salmon.
Is a further escalation in tension in the row over the protocol inevitable?
While the UK move has gone down badly in Dublin and Brussels, it does not mean the door is closed on further negotiations. Both sides have said they remain open to talks and finding practical solutions.