British Proposals for Renegotiating the Northern Ireland Protocol

Author Heenah Licence CC BY-SA 4.0 Source Wikimedia Commons

 

Jane Lambert

The pickle in which HM government finds itself over the Northern Ireland Protocol to the agreement between the EU and the UK for the UK's withdrawal from the European Union was hardly unexpected. If there is to be regulatory divergence between the UK and the EU there have to be customs inspections and formalities somewhere.  If the re-establishment of customs posts on the border between the Republic of Ireland and Northern Ireland is unacceptable to this country's European and American allies, then inspections and formalities have to take place between Great Britain and both parts of the island of Ireland.

Immediately after the end of the implementation or transition period provided by art 126 of the withdrawal agreement, there was disruption in the supply of goods from Britain to Northern Ireland.  These led to street protests and calls for the denunciation of the Protocol if not the whole of the withdrawal agreement.  But there are signs that Northern Ireland retailers are sourcing more and more products from within Northern Ireland, the Republic or the rest of the EU.  That is, of course, weakening economic ties with Great Britain and strengthening ties with the Republic. Ultimately that could lead to the cession of Northern Ireland to the Irish Republic. While Irish unification would be welcomed by some in Great Britain it would be regarded as a calamity not only by Northern Ireland Unionists but also by many members of the British Conservative and Unionist Party.   

Mrs Theresa May was offered an arrangement similar to the Northern Irish Protocol but she rejected it on the ground that it was something that no British Prime Minister could accept.  That raises the question of why her immediate successor did just that.  Para 13 of the UK Government position paper Northern Ireland Protocol: the way forward (CP 502) published on 21 July 2021 offers the following explanation:

"However Parliament’s insistence in the BennBurt Act that the UK could not leave the EU without an agreement radically undermined the Government’s negotiating hand; and the final compromise, while delivering the fundamental aim of a clear Brexit, and recognisably based on the UK’s proposal, included several elements which would prove to cause difficulties subsequently: notably, though not only, the EU’s insistence on customs arrangements between Great Britain and Northern Ireland, with detail to be worked out subsequently; and the failure to provide for Northern Ireland’s consent to enter the arrangements."

That does not make a lot of sense.  Had the government's negotiating hand not been "undermined" the government would have been free to take the United Kingdom out of the EU without any agreement on anything including the border between the Irish Republic and Northern Ireland.  That would inevitably have led to border controls and probably security forces to protect them.

The doleful consequences of the Protocol are summarized in para 20 of the position paper:

"Supply chains have been disrupted and costs increased, with staff redeployed to deal with new bureaucracy, impacting investment and growth. Consumers have seen real impacts: at least 200 companies in Great Britain have stopped servicing the Northern Ireland market; plants and trees long-sourced from Great Britain can no longer be stocked in nurseries or garden centres in Northern Ireland; supermarkets have reduced their product lines due to the delays and barriers in moving goods; and the costs of deliveries for those who do serve the market have continued to increase. The effects are felt more broadly too. Medicines are at risk of discontinuation because the hurdles to clear to reach the small Northern Ireland market make supply unviable. And pet owners, including those reliant on assistance dogs, have faced the prospect of unnecessary vaccinations and treatments, and bureaucratic certification hurdles simply to travel within the United Kingdom."

If this is true, the Northern Irish Protocol is clearly not working for the benefit of British suppliers to Northern Ireland but that does not mean that consumers in that province are going hungry.  There are signs that supplies from Great Britain are being replaced by supplies from Ireland and other EU member states (see InterTradeIreland Cross-Border Trade & Supply Chain Linkages Report).

In the position paper, the government is threatening to invoke art 16 of the Protocol.   It is hard to see how that will help.  The first paragraph of the article provides:

"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. Such safeguard measures shall be restricted with regard to their scope and duration to what is strictly necessary in order to remedy the situation. Priority shall be given to such measures as will least disturb the functioning of this Protocol."

It would appear that "safeguard measures" taken under this article are to be proportionate, short-term and to be taken only in an emergency.  If such measures lead to an imbalance between the rights and obligations under this Protocol, the other party may take such proportionate rebalancing measures as are strictly necessary to remedy the imbalance in accordance with art 16 (2).  Extensive consultations are required before a party may resort to art 16.

The revision to the Protocol that the British government appears to want is inspection-free entry of goods that are intended for consumption in Northern Ireland and full controls for goods intended for the Republic and beyond.   How this would work is not clear because most exporters to the Republic would be expected to choose the M4 to Fishguard or the A55 to Hollyhead rather than the long drive to Cairnryan. The only advantage of the latter would be the opportunity to smuggle. 

The other concession that the government seeks is to remove the resolution of disputes from the jurisdiction of the Court of Justice of the European Union. As EU law applies to the Protocol it is unlikely that there can be much movement there.

Anyone wishing to discuss this article may call me on +44 (0)20 7404 5252 during normal business hours or send me a message through my contact form.

The UK's Future Relationship with the EU - Ursula von der Leyen's Speech and Meeting with Johnson

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Jane Lambert

If the draft agreement on the terms of the UK's departure from the European Union is ratified, that country will cease to be a member state of the European Union at 23:00 on 31 Jan 2020.  The European treaties and legislation will continue to apply to the UK until 31 Dec 2020.  Thereafter a new relationship will subsist between the UK and the remaining member states.

The nature of that relationship will depend on negotiations between the British government and the Commission which can begin only after the UK leaves the EU. Some indication as to the parties' aspirations can be gleaned from President Ursula von der Leyen's speech at the London School of Economics on 8 Jan 2020 and the press release of her meeting with Mr Boris Johnson that took place later that day.

In her speech, President von der Leyen warned that any future relationship between the UK and EU cannot and will not be the same as before. She continued that it cannot and will not be as close as before

"because with every choice comes a consequence. With every decision comes a trade-off. Without the free movement of people, you cannot have the free movement of capital, goods and services. Without a level playing field on environment, labour, taxation and state aid, you cannot have the highest quality access to the world’s largest single market.  The more divergence there is, the more distant the partnership has to be."

The President added that without an extension of the transition period beyond 2020, agreement on every single aspect of the new partnership cannot be expected and that parties would have to prioritize. The EU's objectives will be to work for solutions that uphold the integrity of the EU, its single market and its customs union and on that, there can be no compromise.

The press release stated that the Prime Minister was ready to start negotiations on the future partnership and Canada-style FTA as soon as possible after 31 Jan.  That did not sound a million miles away from the President's position:

"But we are ready to design a new partnership with zero tariffs, zero quotas, zero dumping. A partnership that goes well beyond trade and is unprecedented in scope. Everything from climate action to data protection, fisheries to energy, transport to space, financial services to security. And we are ready to work day and night to get as much of this done within the timeframe we have."

For the rest of this year, this blog will monitor the negotiations for the UK's future partnership with the EU on the New Relationship Negotiations page as well as the progress of the European Union (Withdrawal Agreement) Bill and negotiations for new trade agreements with the USA and other third countries.

Anyone wishing to discuss this article or the consequences of the UK's withdrawal from the EU generally may call me on +44 (0)20 7404 5252 during normal UK office hours or send me a message through my contact form.

Johnson accepts Art 50 (3) Extension

Rt Hon Boris Johnson MP

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Jane Lambert

Art 50 (3) of the Treaty of European Union provides that the European treaties will cease to apply to a state that gives notice of its intention to withdraw from the European Union from the date an agreement on the terms of its withdrawal comes into force or two years from its notification unless the European Council, in agreement with the Member State concerned, unanimously decides to extend that period.

Although a draft withdrawal agreement was reached by negotiators for the British government and the European Union on 14 Nov 2018, it was rejected by the United Kingdom Parliament on no less than three occasions.  As a result of those rejections, the government of the United Kingdom requested and was granted two extensions the latter of which was due to end at 23:00 on 31 Oct 2019.

Largely as a result of concessions that would result in an internal frontier within the United Kingdom, the British government has negotiated a second withdrawal agreement.  That has still to be approved by the Commons in a meaningful vote though the European Union (Withdrawal Agreement) Bill which would implement the agreement has got as far as second reading.

Under the provisions of the European Union (Withdrawal) (No 2) Act 2019 the prime minister was obliged to apply for a further extension if a withdrawal agreement was not approved by a meaningful vote on 19 Oct 2019, The prime minister complied with that obligation with less than the best of grace. Today the Council consented to the extension request in accordance with art 50 (3). Had it not been the European Union (Withdrawal) (No 2) Act 2019 the British government could have declined the offer of an extension but the statute removes his right to do so.  By a letter dated 28 Oct 2019, the prime minister has grudgingly accepted the offer of an extension until 31 Jan 2020.

As there are probably enough Labour MPs who would vote for the withdrawal agreement but nowhere near enough who would vote for a second referendum the overwhelming likelihood is that the second withdrawal agreement would be approved with the result that the UK would have left the European Union in the next few weeks.   The only way to stop it would be to hold a general election at the earliest possible moment and hope that parties in favour of remaining in the EU will improve sufficiently on their performance in 2017 to force a second referendum if not an outright revocation of the notice to withdraw.  That is an enormous longshot for the remain parties and it is not one that is likely to be understood easily by the public.   However, it is the only option that they have left.

Anyone wishing to talk about the prime minister's acceptance of an extension or brexit generally is welcome to call me on 020 7494 5252 during office hours or send me a message through my contact page.

Brexit Briefing - July 2019

10 Downing Street

Author Sgt Tom Robinson RLC/MOD
Licence Open Government Licence  v. 1.0
Source Wikipedia 10 Downing Street

Jane Lambert

On 24 July 2019 HMQ invited the Rt Hon Boris Johnson MP to form a government. Immediately, he installed a new team of ministers and advisers with the mission of withdrawing the United Kingdom from the European Union by 23:00 on 31 Oct 2019. Ostensibly the Johnson administration's objective is to negotiate a new withdrawal agreement within the meaning of art 50 (2) of the Treaty on European Union or renegotiate the existing draft but its preconditions for resuming talks are well beyond the negotiating guidelines of the European Council of 29 April and 15 Dec 2017 and 23 March 2018. According to Daniel Boffey and Rowena Mason, the Commission has advised the governments of the 27 member states that "Boris Johnson has no intention of renegotiating Brexit deal" (5 Aug 2019 The Guardian).

Now announcements of that kind are not always to be taken at face value. It is possible for one side or the other to make sufficient concessions to enable a deal to be done.  Parliament may pass a motion of no confidence or even a statute requiring the revocation of the notice of intention to leave the EU in the event of no-deal,. But these are unlikely.  They will require an act of political courage on the part of a sufficient number of remain minded Tory MPs that few have exhibited to date. There will be enormous demonstrations by brexit supporters and possibly even civil unrest.  The recent plunge in the value of the pound suggests that markets anticipate a disorderly brexit, that is to say, leaving without a withdrawal agreement.

And then what?  In Preparing Brexit: No Deal, the Institute for Government warns that:

• It will be much harder and more complex to strike a deal with the EU;
• No-deal means losing deals with many other non-EU countries;
• A showdown in Parliament cannot be avoided:
• Brexit will dominate Whitehall;
• The government will have to support struggling and failing businesses: and
• The Union will come under unprecedented pressure.

Will we gain in a trade deal with the USA what we lose from erecting barriers between ourselves and our nearest and largest market?  Possibly, but unlikely (see What Sort of Trade Deal (if any) could the UK negotiate with the USA? 8 June 2018).  This morning we were flattered by Senator Tom Cotton and 44 of his colleagues in Cotton, Colleagues Pen Letter Pledging to Back Britain After Brexit 3 Aug 2019. But we were exposed to some healthy realism by former Treasury Secretary Larry Summers who made the point that we have very little leverage in any negotiations with the Trump administration

What can businesses and individuals do to mitigate the consequences of a hard brexit? Obviously, take note of the avalanche of guidance notes and emails that are likely from the government in the next few weeks but there are also a lot of useful suggestions in the CBI's What comes next? The business analysis of no deal preparations (see Practical advice on preparations for No deal from the CBI and IfG 1 Aug 2019).

Anyone wishing to discuss this article or legal issues relating to brexit generally should call me on 020 7404 5252 during office hours or send me a message through my contact form. 

Brexit Briefing - May 2019

In which @RoryStewartUK explains how terrible “no deal” is pic.twitter.com/wDxZtuJIOb

— Rupert Myers (@RupertMyers) May 30, 2019

In one sense a lot has changed since the last Brexit Briefing.  Mrs May has announced that she will cease to be the leader of the Conservative Party on the 7 June 2019.  Elections have been held for the European Parliament at which the Brexit Party appeared to have the largest vote but the total votes of the parties opposing brexit were greater than the total votes of the Brexit Party, UKIP and the Conservatives. In another sense, very little has changed for the options are still the same as they have always been.

The UK can leave the EU on 31 Oct 2019 and face massive tariffs and restrictions on its exports in its largest market that are faced by none of its major competitors inside and outside the EU. It can stay which mean that we retain unrestricted market access but would disappoint a lot of people who voted for the Brexit Party, UKIP, the Conservatives and perhaps the Labour Party in the recent elections. Or we can take the deal of the 14 Nov 2019 which Parliament has rejected numerous times.  The chances of negotiating another with governments that regard no deal as less damaging to their interests than one for which at least some of the Tory party leadership hopefuls lobby seem forlorn to say the least,

The advice that I have given to businesses in the UK remains substantially the same as it has been for over a year.  There is no certainty as to which of those options will be taken.  Businesses that can transfer their manufacturing and service facilities from the UK should continue to do so.  Those that cannot, should do the best they can by stockpiling, developing goods and services that will still be competitive even with discriminatory tariffs and other restrictions and they should look for new markets wherever they can be found.

I suppose one thing that should be mentioned is that the decision to issue a summons in a private prosecution against Tory leadership front runner, Boris Johnson MP, has been criticized vehemently in some quarters.  I am not going to enter the discussion because the matter is sub judice but I will put a link to the District Judge's decision so that readers can judge for themselves as to whether it was well reasoned and properly considered.

Anyone wishing to discuss this article or brexit generally should call me on 020 7404 5252 during office hours or send me a message through my contact page.

Brexit Briefing - July 2018

Plage de la Coutarde

Author Baptiste Rossi
Copyright waived by the author 
Source Wikipedia

Jane Lambert

A lot happened in July. First, the resignations of the Rt Hon David Davis MP, the Rt Hon Boris Johnson MP and a number of other ministers. Secondly, the publication of white papers on The Future Relationship between the United Kingdom and the European Union and Legislating for the Withdrawal Agreement between the United Kingdom and the European Union.   Thirdly, the Prime Minister and her ministers have visited the capitals of other EU member states to canvass support for the future relationship white paper's proposals. Finally, active preparations have begun here and in the rest of the EU for the UK's withdrawal from the EU without a withdrawal agreement.

The procedure by which a member state withdraws from the European Union is set out in art 50 (2) of the Treaty of European Union:

"A Member State which decides to withdraw shall notify the European Council of its intention. In the light of the guidelines provided by the European Council, the Union shall negotiate and conclude an agreement with that State, setting out the arrangements for its withdrawal, taking account of the framework for its future relationship with the Union. That agreement shall be negotiated in accordance with Article 218(3) of the Treaty on the Functioning of the European Union. It shall be concluded on behalf of the Union by the Council, acting by a qualified majority, after obtaining the consent of the European Parliament."

The procedure was initiated by  a letter from the Prime Minister to the President of the Council dated  29 March 2017 giving notice of the UK's intention to withdraw from the EU. The Council provided the guidelines on 29 April 2017 supplemented by others on 15 Dec 2017 and 23 March 2018.  Negotiations on the terms of a withdrawal agreement began after the British general election a draft of which was published in February.  About 80% of the text is now agreed but there are a number of sticking points one of which is the border between Northern Ireland and the Irish Republic.

The withdrawal agreement has to take account of the future relationship between the UK and EU.  The Chequers statement which I reviewed in The Chequers Statement Explained 8 July 2018 was an attempt to get agreement within the government on what that relationship should be.   It did not survive the weekend as David Davis resigned on Sunday night and was followed by several other ministers including Johnson. The white paper on the future relationship was attacked by Brexiteers and remainers in the UK and given a lukewarm reception in Brussels.  I discussed it in The White Paper on the Future Relationship between the UK and the EU on 21 July 2018.  The EU's negotiator, Michel Barnier, set out his vision for the future relationship between the EU and UK in his op-ed  An ambitious partnership with the UK after Brexit on 2 Aug 2018.

If a withdrawal agreement is concluded it will have to be incorporated into English and Welsh, Scots and Northern Irish law by statute. The government's proposals for legislation are set out in the white paper on Legislating for the Withdrawal Agreement between the United Kingdom and the European Union which I discussed in Today's White Paper on the Withdrawal Agreement - What's happened to Ireland? on 24 July 2018.

In Brexit - Why do I follow the Art 50 (2) Negotiations when I am an IP Lawyer? 26 July 2018 NIPC Law I explained why the art 50 (2) negotiations are important and the likely outcomes if they are successful and also if they are not.   I also described the negotiations as "finely balanced".  There is an evens chance of their going either way.

Anyone wishing to discuss this article or Brexit generally should call me on +44 (0)20 7404 5252 or send me a message through my contact form.