Richard North, 23/03/2017  
 


I guess we're going to see a lot of Michel Barnier over the next few years – unless the European Council exerts itself next month and decides on someone else to lead the Brexit negotiations for the EU.

For the moment, though, he's in full flow, speaking at the plenary session of the European Committee of the Regions on: "The conditions for successful negotiation with the United Kingdom".

What grabbed the headlines before attention turned to events at Westminster were his comments on "queues of trucks at Dover", cast by the Financial Times as having Barnier warn of "queues and shortages if Brexit talks fail" and fleshed out by Deutsche Welle with his warning that:
… the absence of a deal could lead to long queues of trucks at British port city Dover, disruption of flights to and from the UK and a shortage of nuclear fuel for Britain's nuclear power plants.
Whether it was intentional, or just bad drafting, though, it cannot have been correct to state that "the reintroduction of binding customs controls, which would ineluctably slow down our trade and generate queues of trucks at Dover" is [exclusively] a consequence of an "absence of an agreement".

Come what may, with the advent of Brexit, we will see "the reintroduction of binding customs controls", the effect of which – as Barnier correctly observes - would "ineluctably" slow down our trade and generate queues of trucks at Dover.

"Ineluctably" is an interesting word for Barnier to use, more so when English is not his first language, although there is a direct parallel in French: "inéluctablement". Both mean the same thing: unable to be resisted or avoided; inescapable. One could also use the word inevitable.

The only real issue in this context is how bad the effects are going to be. Even at best, delays of a few hours will become the norm. But the worst case – and entirely tenable – scenario is that trade through Dover (and the Channel Tunnel) will grind to a halt as customs systems collapse under the sheer weight of traffic.

The interesting thing though is that Barnier can see it as a problem. It was quite evident to us in June 2015, a full year before the referendum, when we were warning Dominic Cummings, even as he was scheming to pervert the "leave" campaign and build the arguments on a platform of lies.

The result, though, is clear enough to Barnier. The United Kingdom, he says, has opted to leave the internal market and the customs union. It will be a third country in two years. And, in making this choice, the UK will find itself mechanically in a less favourable position than a Member State of the Union. Nor will it be able to participate in the Single Market.

This sets the seal on our future trading relations – and we can't say we weren't warned. The vulnerability of Dover to delays brought about by border checks is well known – reported on by the Home Affairs Committee in December 2014.

MPs and ministers can have no excuse for assuming things will run smoothly, and especially not journalists, even if the idiot Halligan is still prattling about the UK being "fine" if no EU deal is struck and we instead use WTO rules.

By coincidence yesterday, we also saw publication by the Lords EU Committee on the effect of Brexit on trade in non-financial services, tucked into which we see an observation that WTO rules would not "ensure the free flow of data".

In the body of the report, it refers to the Data Protection Directive 95/46/EC stipulates that the processing of personal data within the EU is subject to standards of transparency, "legitimate purpose" and proportionality.

Those who collect and process personal data ("data controllers") must protect it from misuse and must respect the rights of those who provide their personal data (‘data subjects’), for example by gaining their consent.

In 2016, the report goes on to say, a major overhaul of the Directive was agreed, and the General Data Protection Regulation 2016/679/EU (GDPR) will replace the Directive from 25 May 2018. Under the GDPR, it says, EU citizens' personal data may only be transferred to a third country if very stringent rules are applied and the Commission has decided that it will ensure an adequate level of protection.

However, there are two sets of EU legislation, the other being Directive (EU) 2016/680. As it stands, the UK has not transposed the Directive and, in the turmoil surrounding Brexit, there are no firm indications that it will.

There must be questions, therefore, as to whether the UK's existing domestic data protection regime will be considered "adequate" by the Commission, or whether it will even have the resource or the political will to make a rapid determination. Left on the back burner, several years after Brexit could elapse before the UK was judged compliant, if at all.

In the interim, this would mean that the UK would not be allowed access to EU databases which held personal data on "EU citizens", which would include customs systems. Without full and active cooperation, on the basis of a negotiated deal on joint customs operations, the UK could be forced to revert to paper-based systems for customs clearance.

Given the implications of this, doubtless the Article 50 negotiations will be focused on crafting an early, and comprehensive agreement. But if we walk away with no deal, then talk of "serious consequences" becomes a grotesque understatement. Be under no illusions, the effects would be catastrophic.

For good reason, therefore, Barnier declares that "this scenario of a non-agreement, a no deal , is not ours". He tells us: "We want an agreement. We want to succeed. Success not against the British, but with them". On behalf of the 27 and with the whole team around me, has says that "we want to reach an agreement on an orderly withdrawal from the United Kingdom and to prepare the way for a new partnership".

That said, Barnier is then setting his own "conditions of this success", at the heart of which is an uncompromising demand that the UK honours its financial commitments to the EU. "When a country leaves the Union, there is no punishment", he says. "There is no price to pay to leave. But we must settle the accounts".

Given the rhetoric from Mrs May and her ministers, to say nothing of the statements from the "Ultras", this is shaping up to be the rock on which any possibility of an agreement founders.

One hardly even needs to read between the lines to see this, as Barnier also declares as a condition for success the need "to do things in order and put them into perspective".

"The challenge", he says, "is to build a new relationship between the EU and the UK on a solid foundation". He adds: "This implies putting things in order: first, finding an agreement on the principles of an orderly withdrawal from the United Kingdom, and then discussing, with confidence, our future relationship".

As clear as he can be, Barnier is saying that the money question must be settled first, without which settlement there can be no discussion on the future relationship.

Taking an entirely pragmatic view, the potential cost of a "no deal" catastrophe is potentially so huge – amounting to hundreds of billions – that any amount the "colleagues" may demand is by comparison modest. We should pay up and be done with it.

"Team Brexit", though, seems trapped by its own rhetoric and, having convinced itself that the "WTO Option" is tenable, lacks that all-important sense of peril that will dissuade it from taking a leap over the edge of the cliff.

Against that, they will find Barnier deciding to "be firm, without being naïve". He is going to "put things in order and put them into perspective" and only then will we "be able to engage on a solid basis the discussion of our future relationship".

This is a more than adequate sign of how difficult the talks are going to be. Mrs May clearly doesn't have the measure of them, and the "Ultras" are away with the fayries. And if they got a dose of reality from the EU's soon-to-be chief negotiator, they show no signs of understanding what they've been told.






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