EU refuses to approve EU-UK trade deal ‘Brexit’

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The European Commission will not suspend the EU-UK trade deal if the UK approves a draft bill that unilaterally overrides parts of the Brexit agreement.

EUWe will be very firm and calm but at the same time proportionate in our response,” Maroš Šefčovič, the Commission’s vice-president and leading Brexit negotiator, said in an interview. 

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“Our next steps will be gradual because we still want to keep the doors for negotiation open.”

Earlier Wednesday, Šefčovič announced the Commission would relaunch legal action against the UK.

Asked if Brussels would go as far as to suspend the EU-UK trade deal, which has been in place since January 2021, the vice-president informed that “if this bill is approved as it is, I cannot exclude anything, and all the options have to be on the table.”

“Our relation [with the UK] is very much based on trust,” he added. “I have to say that trust is severely damaged with this draft bill, introduced after 18 months of discussions.”

Šefčovič’s stark warning comes two days after Downing Street unveiled a draft bill to revoke some aspects of the Northern Ireland Protocol, the tailored-made regime that currently enables the trade of goods between Northern Ireland, which is part of the UK, and the Republic of Ireland, an EU member state.

The protocol ensures the land border between the two sides continues to be invisible and respects the peace deal that put an end to decades of sectarian violence. Northern Ireland follows EU customs rules, remains part of the Single Market for goods and applies EU law on VAT (Value Added Tax) in order to avoid border checks between the two sides.

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Boris Johnson and his foreign secretary, Liz Truss, argue the arrangement is unworkable and threatens the UK’s territorial integrity because it creates a new border in the Irish Sea.

The new bill presented by Truss proposes a green channel to waive customs checks for goods from Great Britain and is intended only for the Northern Irish market. A red channel would process goods that come from Great Britain, pass through Northern Ireland and enter the EU through the Republic of Ireland.

The government also wants Northern Ireland to benefit from the same tax breaks as the rest of the UK, including VAT, and to replace the authority of the European Court of Justice with an “independent arbitration.”

Šefčovič says the bill would exacerbate legal uncertainty in the region, “bury” small and medium companies under a “new pile of bureaucracy“, and increase the risk of smuggled goods entering the EU.

“The bill is illegal. It’s against international law,” he noted. “We don’t see this as a serious offer.”

 

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