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Brexit has finally happened, so trade talks are next. Here's what to look out for

There are three main issues to look out for in the trade talks: fisheries, level-playing field standards, and Northern Ireland.

Image: AP/PA Images

THE UK HAS left the European Union, ending more than four decades of economic, political and legal integration with its closest neighbours.

We’ve passed three different Brexit deadlines before the House of Commons finally ratified the Brexit ‘divorce’ deal, aka the Withdrawal Agreement.

But things will feel the same for the next 11 months at least, owing to a transition period intended to allow both sides time to agree the terms of their future partnership.

As part of the transition period, which is to last until 31 December 2020 if Johnson sticks to his promise not to extend it, the UK stays in the Customs Union, the Single Market, and the European Courts of Justice still oversee its implementation of EU law.

But Britain will lose its representation and voting rights in the EU institutions. This includes having no British members of the European Parliament, no say in European Council meetings, and no EU Commissioner.

So what next? The trade talks, of course. The three years we’ve gone through so far has been called “the easy part”. Here are the key moments ahead:

February/March: Trade talks begin

Britain says it is ready to start trade talks from today, but EU members states are still discussing what they want from the negotiations.

British Prime Minister Boris Johnson is to flesh out his ideas for a free trade agreement along the lines of a recent EU deal with Canada, in a speech to be delivered in early February.

The EU mandate could be approved by national ministers on 25 February, officials in Brussels suggest, which would mean talks could begin around 1 March.

Britain is hoping to open trade talks with the United States and other non-EU countries around the same time.

Trade is not the only issue that must be resolved with Brussels, however. Britain and the EU closely cooperate on security and law enforcement, education and energy among many other issues.

Brexit trade talks: What are the biggest issues

There are three main issues to look out for in the trade talks: fisheries, level-playing field standards, and Northern Ireland.

On the level-playing field, this had been a legally binding commitment in the Withdrawal Agreement aimed at creating a base level of standards for labour rights, the environment, tax and state aid rules.

This is so as to ensure state aid rules aren’t used by either side to boost their own companies; labour rules aren’t lowered in order to increase company profits; or environmental standards aren’t renegned upon in order to become more competitive post-Brexit.

But in the final Withdrawal Agreement, the level-playing field provision was taken out and instead put into the Political Declaration – reducing it to a statement that the UK could do a u-turn on in trade talks, which would be a concern for the EU’s economy, and for EU citizens living in the UK.

On fisheries, this has been a big issue for both sides to find common ground. The UK wants to “take back” its waters, meaning EU vessels would no longer be allowed to fish in its waters.

But the EU’s response to this would be to increase tariffs on British fishing imports – meaning the UK market would catch more fish and sell less of it, or make less of a profit from the amount they do sell.

More than 50% of fish that have been caught in UK waters are by non-UK vessels last year. This is mirrored in Ireland, as a spokesperson for the Foyle Fisheries Co-Op told us previously:

More than half of our fishing is done in UK waters, there’s not really fishing in Lough Foyle other than oysters – it’s an absolute doomsday scenario if EU boats are prevented from fishing in UK waters.

When asked whether the UK would trade access to it’s waters for a trade deal with the EU, Michael Gove told Sky News ”No… If people want to fish in our waters, we’ll decide… We’re in control.”

On Northern Ireland, UK Chancellor Sajid Javid has said that there wouldn’t be alignment with the EU after the transition period ends; Johnson is expected to repeat that sentiment in a speech to be given tomorrow.

He’s expected to demand “no alignment, no jurisdiction of the European courts, and no concessions” with Brussels, which is fine, if it didn’t immediately pose a concern for the customs arrangements in Northern Ireland.

If there isn’t alignment, that would mean that the UK and EU would have different rules, and if the differences are dramatic enough, it suggests that custom checks of sorts will be needed.

Under the protocol provision in the Withdrawal Agreement, the customs plan for Northern Ireland is very vague. But, if Johnson doesn’t align the UK’s rules to the EU’s, it could mean hefty checks at ports and airports on good going between Northern Ireland and Great Britain.

That all depends on: the level of alignment/divergence, and the customs arrangements for Northern Ireland, as to be clarified by a special committee.

These include 1 July: Extension deadline

The transition period is scheduled to last until 31 December 2020.

Britain can ask to extend this for one or two years, but must inform the EU of its request by 1 July.

Johnson insists he will not do this, saying that Britain must be free of EU rules and regulations as soon as possible. 

He has blocked himself from requesting an extension with an amendment attached to the Withdrawal Agreement, which was approved in a vote by the Houses of Commons.

But this could be reversed if Johnson wants – the real block to the decision would be the possible political backlash to the UK remaining in the Customs Union and Single Market for longer.

31 December: Transition period ends

Without an extension or a trade agreement, relations between Britain and the EU will be severed at the end of 2020.

This seems impossible by comparative standards: for reference, other EU trade talks have dragged on for much longer:

  • Canada deal: 8.5 years
  • Japan: 6.5 years
  • Mercosur: 20 years so far.

Failure to agree one in time would mean a stripped back, very basic trading relationship on WTO rules, which could mean cross-Channel trade, transportation and a multitude of other ties severely disrupted overnight.

- with reporting from AFP

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