Brexit Update -17th August 2017

By September 1, 2017 Brexit Updates

Top 3 developments

  • Government releases long-awaited Brexit policy papers on the Irish border and Customs Union.
  • Brussels rebuffs UK position papers, and trade talks look likely to be delayed.
  • Home Office official confirms that UK-EU visa-free travel will continue post-Brexit

UK Update

VISA accepted here

The Government looks set to keep visa-free travel between the UK and EU after the UK leaves the bloc. According to reports in The Times, Whitehall sources have confirmed that there will be no extra checks on EU citizens travelling to the UK. Under the new plans EU nationals would be free to visit the UK, but would require permission to work, study or settle. The proposal is still being finalised and is, as such, thin on detail; the Home Office is said to be releasing more detailed plans “within weeks”. The report comes after the Government’s most recent Brexit policy paper implied there would be no passport checks, CCTV cameras or checkpoints on the UK-EU border in Ireland. Former UKIP leader Nigel Farage has accused the Government of “bowing to EU demands”.

Policy papering over border cracks

Under newly-released Government proposals there will be no physical border between Northern Ireland and the Republic after the UK leaves the European Union. The policy position paper proposes a wide-ranging exemption under which small and medium-sized businesses could be exempted from any “new customs processes at all” (including agricultural and food safety checks), whilst big businesses could be given “trusted trader” status to reduce formalities. The UK is offering “regulatory equivalence” with the EU in return for the concessions.

The proposal also rejects outright any “physical infrastructure” on the border – including CCTV and number plate recognition – and calls for the continuation of the Common Travel Area (CTA). The Government admits that maintaining the CTA relies on Ireland staying outside of the Schengen borderless zone. Meanwhile critics have argued that the lack of border checks risks creating a “back door” into Europe, allowing people to move illegally between the UK and the continent. Ministers believes the impact of any such undocumented immigration could be limited through tighter checks on UK work permits, and that the proposals reiterate their commitment to the Good Friday Agreement (of which the UK is a co-guarantor). The proposals have been broadly welcomed by the Irish government who have praised the Government’s commitment to a borderless Ireland, but also warned that the country will not be “used as a pawn” in the negotiations. Business and industry leaders have also welcomed the proposals as offering some long-awaited clarity on the Government’s intended Brexit direction.

HM Revenue and Customs Union

The Government has published a paper setting out its position on the UK’s future relationship with the EU Customs Union. Only one of the Government’s three proposals involve the UK not being a part of some form of customs union – and ministers are not keen on this option. The first model proposes a new “partnership” customs arrangement (essentially a near-identical customs union), meaning the UK would be exempt from customs checks. This would constitute a considerable concession for the EU, since the UK would benefit from the customs union whilst still being able to forge new trade agreements (unlike EU Member States which are not able to negotiate bilateral trade agreements outside of the bloc). The second model proposes a “highly streamlined” arrangement in which the future customs regime is simplified. Described by the Government as an “innovative and untested approach”, this proposal was thin on detail, but could include implementing new technology and negotiating new systems to speed things up at ports.

In the meantime, the Government wants to maintain a “temporary customs union” for two to three years after it leaves the EU in March 2019, to allow businesses time to adjust to the newly-agreed regime. Ministers also want to be able to negotiate new international trade deals during the transition period. David Davis argues this is possible under the EU’s “duty of sincere cooperation”, despite Brussels’ insistence that the UK cannot negotiate new trade agreements whilst it is a part of the customs union.

The Damned United

Cabinet Ministers Philip Hammond and Liam Fox appear to finally have reached a position of unity on Brexit. Writing jointly in the Sunday Telegraph, the Chancellor and International Trade Secretary reiterated that the UK would leave the EU, the EU single market and the Customs Union in March 2019. The ministers called for a “time limited interim period” after the UK leaves the EU, but said “it cannot be indefinite; it cannot be a back door to staying in the EU”. Hammond and Fox have appeared to be at odds with one another for most of the summer, as Hammond has pushed for a softer Brexit, whilst Fox has supported a hard-Brexit.

New anti-Brexit party to be formed

The Brexit Secretary’s former chief of staff has confirmed his intention to form a new pro-EU party. James Chapman, who has previously worked for both David Davis and George Osborne, says he will officially launch his new party – called “The Democrats” – at a march in London on 9th September. Chapman left the Department for Exiting the European Union before June’s general election, saying “I did my best to make Brexit work for a year — and it won’t. There is no upside and it is clear that every sector of our economy will suffer for decades to come. Project Fear is Project Fact”. He says the aim of the new party is to reverse Brexit without holding a second referendum. Chapman’s party is unlikely to create a political earthquake, however, as he became embroiled in controversy after engaging in a “Trumpish” Twitter rant about Brexit, David Davis and the media.

European Update

Trade negotiation delays look inevitable

The EU has flatly rebuffed the series of UK Brexit policy position papers released this week – renewing fears that the next phase of talks could be delayed until the end of the year. Whilst broadly welcoming the publication of the proposals as a positive step towards serious negotiations, Brussels’ response reiterates that the terms of withdrawal must be settled before the future relationship is discussed; a Commission spokesman said, “an agreement on a future relationship between the EU and the UK can only be finalised once the UK has become a third country”. EU chief negotiator Michel Barnier also tweeted, “the quicker the UK & EU27 agree on citizens, settling accounts and Ireland, the quicker we can discuss customs & future relationship”. European Parliament Brexit chief Guy Verhofstadt went further, dismissing the proposals as a “fantasy”. Meanwhile, David Davis remains adamant that the terms of divorce will not be agreed any time soon. Speaking to BBC Radio 4’s Today programme, Davis said, “there won’t be a number [agreed for the divorce bill] by October or November”, even though this has made his European counterparts “quite cross”.

Timeline

  • 28th August – Third round of Brexit negotiation talks
  • 4th September – Parliamentary recess ends
  • 7th – 11th September – EU (Withdrawal) Bill Second Reading
  • 18th September – Expected start of fourth round of Brexit negotiation talks
  • 24th – 27th September – Labour Party Conference
  • 1st – 4th October – Conservative Party Conference
  • 9th October – Expected start of fifth round of Brexit negotiation talks
  • 19th October – EU Summit