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    UK approach: zero tariffs and quotas, but no stricter conditions than Canada deal

    150 150 ioana bere

    The UK published its approach to future negotiations with the EU, confirming what government officials have said already in public: the UK rejects any obligations on alignment and wants a comprehensive trade agreement similar to Canada.

    The UK wants the same ambitious market access as the EU is aiming for: no tariffs, fees, charges and quantitative restrictions, the most ambitious trade access ever considered by the EU. But the UK does not want to accept stricter trade-related conditions than those applied to other EU trade agreements such as with Canada or Japan.

    The chapter on environment and labour lacks the ambition of the EU’s proposal. The UK wants a trade and sustainable development chapter with more basic provisions similar to Canada’s agreement.

    The UK seems open for a more developed cooperation on chemicals management, showing willingness for data and information sharing mechanisms, as well as peer agency cooperation.

    There is no position yet on institutional arrangements. 

    According to the text of the mandate, a public consultation on the economic implications of the future agreement will be organised this spring.

    UK’s approach to negotiations on a future relationship with the EU

    Council strengthens level playing field requirements

    150 150 ioana bere

    EU Member States approved a tighter negotiation mandate on a new partnership agreement with the UK. The level playing field (LPF) requirements have been strengthened, which the European Parliament also asked for in its last resolution. LPF is now going well beyond the Commission’s proposal, which only required that non-regression from environmental and employment standards is in place by end of 2020. Barnier warned in a press conference that the EU will not go for a deal at any price and will firmly stick to the mandate’s conditions as well as to the general principles agreed with British counterparts in the Political Declaration.

    While the negotiating directives stay in large part the same, there are five new paragraphs added (11, 33, 46, 58 and 78) and multiple adjustments in different parts of the mandate. According to newly added paragraph 11, “the negotiations will be conducted in a way to ensure parallelism among the various sectoral tracks of the negotiation”.

    The chapter on the level playing field (LPF) has been strengthened at the request of France. There is a temporal dimension which has been added: the LPF must “stand the test of time” (paragraph 10), “last over time” (paragraph 94) which has echoes of dynamic alignment. This LPF temporal conditionality aims to ensure a sustainable and long-lasting relationship between the Parties. The EU standards are mentioned as a point of reference for the LPF. The enforcement side has also been strengthened, as the text now says that each area included in the LPF should have an adequate mechanism for implementation.

    Text capture: Adjustments done in Council are marked in yellow

    Council, negotiating directives on a new partnership agreement with the UK

    Negotiating directives for a new partnership with the UK

    545 824 ioana bere

    This piece aims to present and analyse the main features of the negotiating directives for a new partnership with the UK, while also comparing them to those proposed back in 2009 for Canada, respectively in 2017 for Australia (the preferred options of Prime Minister Johnson). There is no agreement concluded yet with Australia, but this text considers the negotiating directives with Australia reflect the level of ambition Prime minister Johnson intends to go for, and are thus relevant for the analysis.

    Disclaimer: this document only looks at the draft negotiating mandates proposed by the European Commission, and not the negotiation mandates adopted by the Council (for Australia and Canada), final deal agreed with Canada or the current form of the chapters under negotiation now with Australia.

    Authors:
    Ioana Bere, Consultant at Stefan Scheuer Consulting
    Support from Stefan Scheuer, Director at Stefan Scheuer Consulting

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    The EU Parliament ups the level playing field and urges EU-UK cooperation on chemicals

    150 150 ioana bere

    The EU Parliament wants the EU to be more forceful on the level playing field conditions, stating that the “level of quota and duty free access to the world’s largest single market fully corresponds to the extent of regulatory convergence and the commitments taken with respect to observing a level playing field for open and fair competition with a view to dynamic alignment.
    The mandate proposed by the Commission sets out that the level playing field is different for state-aid, requiring dynamic alignment, while for environment and employment it mainly relies on non-regression (i.e. not lowering standards which were in place before 1 January 2021).

    Here are the main asks the EU Parliament put forward:

    • strong requirements on the level playing field, which is considered a general principle for the whole agreement and for the economic part, as well as an indicator for the ambition of the future partnership;
    • dynamic alignment is also mentioned as a possible next step of the level playing field, being also a determinant factor for the comprehensiveness of the deal;
    • alignment on the chemicals safety legislation (REACH) and ensuring cooperation with ECHA;
    • legislation developed during the transition period should apply to the UK. The main legislative package with potential important consequences is the European Green Deal; and
    • application of the precautionary principle.

    The resolution was approved by 543 votes, with 39 votes against and 69 abstentions.
    EU Parliament, resolution on a new partnership with the UK (provisional edition)

    The EU Parliament ups the level playing field and urges EU-UK cooperation on chemicals

    150 150 ioana bere

    The EU Parliament wants the EU to be more forceful on the level playing field conditions, stating that the “level of quota and duty free access to the world’s largest single market fully corresponds to the extent of regulatory convergence and the commitments taken with respect to observing a level playing field for open and fair competition with a view to dynamic alignment.
    The mandate proposed by the Commission sets out that the level playing field is different for state-aid, requiring dynamic alignment, while for environment and employment it mainly relies on non-regression (i.e. not lowering standards which were in place before 1 January 2021).

    Here are the main asks the EU Parliament put forward:

    • strong requirements on the level playing field, which is considered a general principle for the whole agreement and for the economic part, as well as an indicator for the ambition of the future partnership;
    • dynamic alignment is also mentioned as a possible next step of the level playing field, being also a determinant factor for the comprehensiveness of the deal;
    • alignment on the chemicals safety legislation (REACH) and ensuring cooperation with ECHA;
    • legislation developed during the transition period should apply to the UK. The main legislative package with potential important consequences is the European Green Deal; and
    • application of the precautionary principle.

    The resolution was approved by 543 votes, with 39 votes against and 69 abstentions.
    EU Parliament, resolution on a new partnership with the UK (provisional edition)

    Barnier presents an ambitious negotiation mandate

    150 150 ioana bere

    The EU chief negotiator Barnier presented on Monday the most comprehensive negotiation mandate (the negotiating directives) ever prepared by the Commission. The 25 pages long text has three main substantive chapters: economic, security and institutional and other horizontal arrangements.

    There are several distinct features that makes it stand out in comparison to other free trade negotiation mandates in the past: 

    • the evolving nature and the possibility of periodical review (para 8 and 143)
    • the governing body in charge of overseeing the implementation of the treaty, and with the power to take decisions and recommendations in regard to the evolution of the partnership (para 150)
    • the level playing field (LPF) requirements are covered in an own chapter but also referred in the trade-related section, highlighting their importance. LPF requirements, as a condition for the partnership, are justified in the draft mandate by the “geographic proximity and economic interdependence” of the EU and UK. The areas covered by the LPF requirements are (para 89): state aid, competition, social and employment standards, environmental standards etc. The LPF requirements are supposed to evolve over time and the governing body will be in charge of modifying and extending them.
    • a ratchet clause has also been included to prevent both Parties from lowering high standards and the level of protection in the following areas: carbon pricing, labour and social protection, environment (para 105)

    The negotiating directives will be discussed by the Member States in the Council configurations and are expected to be adopted on 25 February at the General Affairs Council.

    EU Commission, communication on the negotiating directives
    Video of the chief negotiator Barnier
    Full statement of the chief negotiator Barnier

    “No” to EU standards in exchange for an FTA, says Johnson

    150 150 ioana bere

    The UK Prime Minister Johnson started his speech on the future partnership UK-EU with a eulogy of free trade.

    He said the UK will not engage in a race to the bottom by undermining EU standards and engage in commercial, social and environmental dumping. However, he made clear the UK will not accept to take EU standards and rules in exchange for a free trade deal. He added the UK will maintain high standards without the compulsion of a treaty. The Prime Minister ended by saying the UK wants a free trade deal similar to Canada or even Australia (which is still under negotiation).

    The UK government published a written statement on the future negotiations, which makes clear the deal cannot include any regulatory alignment, any jurisdiction of the EU Court of Justice or supranational control in any area. In regard to competition, labour and environment policies, the government will not agree to go beyond what is typically included in a comprehensive free trade agreement.

    Video of Prime Minister Johnson
    Full statement of Prime Minister Johnson
    Written statement on UK-EU relations

    Wales asks for a broad level playing field, dynamic alignment and ECHA membership

    150 150 ioana bere

    The Welsh Government made clear its goals and suggestions for the future partnership EU-UK. It disagrees with the tight negotiation timetable decided by the UK government and insists that a cliff edge in December 2020 must be avoided if a comprehensive agreement cannot be reached over the coming year. The text reads that the UK must prioritize a trade agreement with the EU over other countries. It also says some aspects must go beyond the Political Declaration agreed by the Prime Minister Johnson in October 2019:

    • agreeing to a broad level playing field, including alignment on environmental, social and labour market standards
    • dynamic alignment with EU rules and regulations necessary to ensure no new trade barriers come into force
    • participation in EU bodies and agencies such as the European Chemicals Agency to support dynamic alignment

    The Welsh Government on the future UK-EU relationship

    Friends of the Earth asks for high environmental ambition

    150 150 ioana bere

    Several national Friends of the Earth groups sent a letter to MEPs, Environment Ministers and Permanent Representations from the Czech Republic, Denmark, Malta and Netherlands, asking them to put high environmental ambition at the heart of the future negotiation with the UK.

    The negotiation is seen as a test for the European Green Deal and for the ambitious environmental path set by the new Commission. The NGOs call for environmental and social standards in the UK not to be weakened post-Brexit and be backed by a guarantee of non-regression enforced via a bilateral mechanism. They also demand a mechanism to ensure a form of ongoing alignment that “embeds transparency and democracy while respecting the sovereignty of the UK”.

    Do not exclude a no-deal scenario, says EU Parliament’s Environment chair Pascal Canfin

    150 150 ioana bere

    The EU should not be afraid of a no-deal in December 2020, the chair of EU Parliament’s Environment committee Pascal Canfin (French MEP, Renew Europe) told reporters this week. He warned current discussions did not start on a good path, with UK asking for full single market access and divergence at the same time. He gives the example of the EU’s Emission Trading Scheme as a possibly thorny issue. As UK plans to set its own carbon market, he cites the carbon adjustment mechanism (a tool EU started designing), as a way to protect EU business in case the UK does not respect a level playing field on carbon prices.

    Pascal Canfin and the Environment committee will advise negotiators on environment-related issues during talks.

    Euractiv on Pascal Canfin

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