Brexit: fun and games

17/12/2020

In days when the agenda is driven by rumour, fuelled by quotes from anonymous spokespersons and official non-statements, it is a refreshing change actually to have a good, old-fashioned speech to dig into, even if it doesn't tell us very much.

Needless to say, this comes from the Brussels end, with von der Leyen reporting to the European Parliament on the outcome of the European Council of 10-11 December – the meeting that was supposed to coincide with the final, final deadline for the "future relationship" talks, but somehow became just another one that got away.

Given that EU leaders on the 10th only spent ten minutes discussing the UK situation, vdL probably spend as much time briefing MEPs than was devoted to the main event, but even then it only qualifies as a "brief update" on what was termed "unfinished business".

"And as things stand", she says, "I cannot tell you whether there will be a deal or not, but I can tell you that there is a path to an agreement now. The path may be very narrow but it is there and it is therefore our responsibility to continue trying".

"The good news", she adds, "is that we have found a way forward on most issues, but this is now a case of us being so close and yet so far away from each other. Because two issues still remain outstanding, you know them: the level playing field and fisheries".

On the level playing field, vdL tells us, "our aim is simply to ensure fair competition on our own market, very simple. And this is why we need to establish robust mechanisms".

She goes on to explain to MEPs that the "architecture" being worked on "rests on two pillars: state aid and standards". On state aid, she says, "we have made progress, based on common principles, guarantees of domestic enforcement, and the possibility to autonomously remedy the situation where needed".

On standards, we are told, the parties "have agreed a strong mechanism of non-regression". That, she says, "is a big step forward – and this is to ensure that our common high labour, social and environmental standards will not be undercut". Difficulties still remain "on the question of how to really future-proof fair competition", but vdL nevertheless reports that "issues linked to governance, by now, are largely being resolved".

That leaves fisheries, where the discussion "is still very difficult". We do not question the UK's sovereignty over its own waters, she says, "but we ask for predictability and stability for our fishermen and fisherwomen".

In all honesty, the commission president says, "it sometimes feels like we will not be able to resolve this question. But we must continue to try and find a solution. And this is the only responsible and right course of action".

Any optimism that might be apparent from vdL, however, is not mirrored this side of the Channel (or perhaps it is delayed I the queue). Yesterday afternoon, the official line from Downing Street was that leaving the Brexit transition period without a trade deal remains the most likely outcome.

In a weary ritual, though, the spokesthing acknowledged that "we have made some progress", adding the formulaic mantra that "time is now in short supply to reach an agreement", as if we didn't know already, with the reassurance that talks will "continue over the coming days".

On that home from, the news of the day comes from less than a mile down the road, in the Palace of Westminster. Despite yesterday's report that MPs were to be kept on in anticipation of an imminent deal, they have, after all, been told to bugger off at the end of today, subject to an emergency recall if a deal is concluded.

Treated by some sources as a sign that a hopes of an early conclusion are fading, others are suggesting that the early warning of a possible recall keeps the door open for an agreement as early as next week.

Angela Merkel, however, has told the Bundestag that: "There has been progress but no breakthrough, but I think we will stick to our opinion, a deal would be better than no deal, but we are also prepared for the latter". Even if talks go on past Monday next week, though, it is not the end of the line. The European Commission could propose that all or part of the treaty is allowed to enter force, subject to ratification and the Council (not the European Council, as some papers seem to think) could then cement this "provisional application" in place with a formal decision.

That would pave the way for ratification by the European Parliament some time next year and, if necessary, ratification by Member States. Most papers are skirting round this point, but some are beginning to recognise the role of Member States.

There is even the possibility that, if the Commission tries to slide this through the system as a straightforward trade deal, it could be subject to legal challenge, with the outcome forcing the full ratification process. One could imagine France being quite keen on such a move, with the opportunity to veto the deal if its fisherpeople are kicking up.

There is also the possibility now being talked about of a temporary "managed no deal" – a bodge which could be put in place if the talks run up to the new deadline. This could involve a "complex mix" of unilateral EU measures, covering areas such as aviation and road haulage – requiring reciprocal action on the part of the UK.

This brings to mind the classic fudge of all fudges. In the absence of a formal, bilateral agreement, we have "synchronised unilateralism", where the parties spontaneously – but entirely independently – happen to grant each other rights or privileges which just happen to have the effect of a deal.

This is more than a bit dodgy as any such concessions, under WTO MFN rules, have to be available to all comers. But, with a bit of creative wording the situation could be buried in legal obscurantism so that, by the time any aggrieved parties got a complaint together and into court, the actual "fix" would have been replaced by a permanent deal.

There is even talk of adopting GATT Article XXIV, allowing interim trade deals, where talks are continuing, although that is hardly a quick fix and is unlikely to apply, where no agreement has been reached.

Meanwhile, some of the consequences of Brexit are beginning to hit home as British food exporters to Northern Ireland discover that they will have to pay vets up to £150 a time for export certificates which are needed to accompany consignments of live animals or products of animal origin.

The meat industry has been long-used to the veterinary fees racket, having been forced to pay for "veterinary supervision" of their slaughterhouses – often by recently-qualified Spanish or Portuguese vets with no slaughterhouse experience or English language skills. Now, it looks as if the rest of the food industry will be joining the rip-off club.

The bigger joke is that up to £600 will be demanded for the special certificates required for transporting horses which, when added to the other controls, will neatly stuff the horseracing industry.

For the moment, it appears that the government will be paying the fees, but that will last for only so long, with a review due in three months. When you add the inspection fees at the Border Control Posts – and factor in the inevitable rejection rate – exporting animals and animal products is going to be a pricey business, and not just to Northern Ireland. The costs will apply to all exports to EU Member States.

Such are the delights which await our businesses, deal or no deal, presenting them with "fantastic opportunities" to go bust. Who was it, I wonder, who told the government that we should go for "mutual recognition"? That doesn't seem to have turned out so well.

And, of course, this is only the start. Courtesy of Boris's Botched Brexit, we can look forward to endless fun and games.

Also published on Turbulent Times.