The British government’s new approach to the Northern Ireland Protocol, outlined in a command paper published on Wednesday, represents a root-and-branch rewriting of the Brexit deal UK prime minister Boris Johnson agreed with the EU in October 2019.
To avoid a hard border on the island of Ireland, the deal created a trade border in the Irish Sea because it required all goods travelling from Great Britain to Northern Ireland to follow stringent EU rules, both for customs and checks on animal and plant-based products.
The paper makes five bold proposals — which the EU has already signalled it is unlikely to accept — to reduce radically the number of checks at the border and reclaim elements of UK sovereignty that were ceded to the EU in the original deal.
The proposals, which draw on already-rejected solutions from four years of EU-UK negotiations over how to solve the Northern Ireland Brexit conundrum, require high degrees of trust between the UK and the EU in order to avoid the return of a hard border in Northern Ireland.
An ‘honesty box’ approach to the border
The UK government contends that the current level of checks on the Irish Sea border — 20 per cent of all EU external border checks despite Northern Ireland representing just 0.5 per cent of the EU population — is “unsustainable”.
The paper proposes a radical solution to this: remove all checks on goods going from Great Britain to Northern Ireland where a business has self-certified that its products are not intended for onward distribution or use in the EU.
“There would be no need for certificates and checks for individual items that are only ever intended to be consumed in Northern Ireland,” the document says, so long as businesses agree to provide data to the EU and “complete transparency” for their supply chains.
Industry is sceptical. Shane Brennan, chief executive of the Cold Chain Federation, said the idea of an “honesty box” approach was superficially attractive but would be difficult to extend to smaller businesses and wholesalers.
“Trusting the trader generally means trusting the big trader and so biases towards the needs of supermarkets. This idea could simply perpetuate the massive unfairness and distortions that exist today,” he said.
A ‘dual regime’ for UK and EU standards
To manage divergent standards between the EU and the UK after Brexit, the government proposes a “full dual regulatory regime” that would allow goods with differing EU and UK standards to circulate freely side by side within Northern Ireland.
Goods made to UK standards that were not compliant with EU rules would be clearly labelled as “NI-only”, but any goods destined for Ireland and the EU single market would need to meet EU rules and follow EU customs processes.
The UK argues that given Northern Irish trade volumes, the overall risk to the EU single market is “manageable and acceptable”. To reassure the EU, it also promises “stronger” enforcement measures and “enhanced forums” for market surveillance to catch smugglers.
But William Bain, head of trade policy at the British Chambers of Commerce, said the scheme would be problematic in Brussels because it effectively asked the EU to “subcontract” the border of its single market and customs union to the UK.
“It neither looks negotiable or legally viable because the EU would be dependent purely on UK monitoring and enforcement, which the European Court of Justice will not accept. The EU does not do this with other neighbouring countries, like Ukraine, for example,” he added.
Removing any export declarations
The command paper also seeks to remove the need for any “export declarations” on goods travelling from Northern Ireland to Great Britain, in keeping with repeated promises by prime minister Boris Johnson that no paperwork would be required. This was to maintain the “unfettered access” of Northern Ireland’s businesses to the UK internal market.
In a compromise deal negotiated last year, the EU agreed to waive the need for formal export declarations on goods leaving Northern Ireland for Great Britain, agreeing that the data could be collected via shipping manifests and other routes.
But the UK government now argues that even this creates “burdensome new requirements” for Northern Ireland’s businesses and wants to “definitively eliminate” these requirements, except for a small number of controlled and dangerous goods.
Rewriting Article 10 on state aid
The government also wants a fundamental rewrite of the controversial Article 10 of the protocol which requires any UK government subsidy decision that potentially affects goods trade in Northern Ireland to comply with EU state aid rules.
Brexiters see Article 10 as an affront to UK sovereignty since it is so broad in scope that it gives the European Commission the ability to interfere in UK government subsidy decisions that only indirectly touch Northern Ireland.
The government argues that now it has published a Subsidy Control Bill setting out the UK’s new post-Brexit subsidy regime, Article 10 is “redundant” in its current form and should be applied only to larger subsidies that relate “directly to Northern Ireland”.
Alexander Rose, an EU competition expert at law firm DWF, said the new UK legislation does provide reason to at least partially rethink Article 10.
“The two sides should meet and develop a new regime, taking account of the assurances being offered and the new Subsidy Control Bill,” said Rose, noting that the protocol contains a provision to scrap Article 10 without reopening the rest of the agreement.
Ending the writ of the ECJ over the protocol
Lastly, the UK wants to remove the right of the EU and its Court of Justice to enforce major elements of the protocol — a situation the UK says is “highly unusual”, but the EU argues is essential because under the agreement Northern Ireland has to follow large tracts of EU law.
The UK is asking that the protocol be governed by a “normal treaty framework”, similar to that used by the Trade and Cooperation Agreement — the post-Brexit deal agreed by the EU and UK last December and which came into force on January 1, with any disputes being resolved by international arbitration, if necessary.
George Peretz QC of Monckton Chambers said the EU was certain not to agree to this because the ECJ is the sole arbiter of EU law.
“It’s pretty straightforward. Goods freely circulating in Northern Ireland could not be stopped from entering the EU single market, but those goods would be outside the control of the institutions that enforce the rules of the single market. It’s pretty difficult for the EU to agree to that,” he said.
Source: Economy - ft.com
