This week, Britain and the European Union (EU) entered their seventh round of Brexit negotiations. Yet, the possibility of a deal still hangs in the balance. The UK’s chief Brexit negotiator David Frost explained, “we have had useful discussions this week but there has been little progress… substantive work continues to be necessary… if we are to deliver [a deal]”.
This uncertainty can’t last forever. The Brexit transition period expires on the 31st December. To reach this deadline with a deal, negotiations need to be successful next month. Here are the key issues still to be solved and an analysis of just how realistic the prospect of securing a deal may be.
1) The EU’s level playing field demand
The single market underpins the foundation of the EU, in which member countries allow the free movement of people, goods, services and money amongst themselves. This freedom only works if its regulated by what’s called a level playing field. These regulations ensure that no business in one country undercuts their rivals in another EU country in order to gain a competitive advantage.
Trade negotiators need to establish how widespread level playing field provisions should be after Brexit, particularly in areas such as workers’ rights, environmental protection, taxation and state aid (or subsidies for business). While Boris Johnson wants a zero-tariff, zero-quota deal as well as rights to diverge from EU rules and regulations, the EU has argued that the UK’s large economy and proximity to the EU’s doorstep justifies strict level playing field rules across all of the above areas. Bridging that significant gap may prove impossible.
European Commission President Ursula von der Leyen has explicitly said that “without a level playing field on environment, labour, taxation and state aid, you cannot have the highest quality access to the world’s largest single market”.
Her warning is a clear reminder that the UK and EU edge towards a future in which both are friends and partners, but crucially, also rivals.
2) Fishing rights
Fishing remains an emotional and contentious part of the UK’s relationship with the EU. Brexiteers argue that it’s a symbol of sovereignty to be restored, and that British fishing grounds should be for British boats, first and foremost. Meanwhile, the EU argues that to secure an open trade deal, with no tariffs or taxes on goods, in return it must be compensated with what it deems to be a fair share of fish tonnage going to EU boats.
Currently, more than 60% of the fish tonnage landed from British waters is caught by boats from other EU countries. Renegotiating that percentage, derived from algorithms established in 1970, and rebalancing Britain’s access to EU fishing markets, has proved an unending challenge. It’s no surprise that the EU and UK haven’t found a compromise when there’s so much riding on both sides to secure their access to these waters and subsequent fishing markets.
Brexit rhetoric revolved around “taking back control”. A big part of this referred to British borders. On Thursday, plans to achieve this were derailed.
Britain proposed a migration pact, which would allow “all third-country nationals and stateless persons” who enter Britain without the right paperwork to be returned to the last EU country they had passed to reach British soil. This practice is ongoing throughout the EU. It’s a cornerstone of the European asylum system known as the Dublin Regulation.
On Thursday, EU negotiators rejected this plan. The EU said that such a practice was only active within the Union and that the regulation would be unequivocally retracted from the UK on 31st December 2020.
Tensions continue to rise on this topic, particularly after a Sudanese teenager tragically died while attempting to cross the Channel in an inflatable dinghy and Home Secretary Priti Patel argued that migrants flock to Britain because they see France as a “racist country” in which they may be “tortured”.
Britain has accepted fewer refugees and migrants than most other EU countries. Last year, Germany registered 142,450 applications for asylum. This number decreased to 119,915 for France, 74,905 for Greece and just 44,250 for the UK. Boris Johnson is under pressure from Brexiteers to keep this number low. He must balance this pressure with those to minimising tragedies and somehow work with the EU to introduce a replacement for the Dublin Regulation, which seems an impossible task.
Can these issues be solved?
On Monday, the Prime Minister’s spokesperson made the vague commitment of “continuing to plug the gaps” during this week’s negotiations in Brussels. It seems that even that was too much to ask.
Coming out of discussions today, David Front explained that the UK and EU had made little progress. He assured the UK public that a deal “is still possible, and it is still our goal, but it is clear that it will not be easy to achieve”. In contrast, the EU’s chief Brexit negotiator Michel Barnier expressed his “disappointment” by the lack of progress made. He said that “we are wasting valuable time” and concluded a deal “seems unlikely”.
Whether the UK and EU are ready or not, Brexit will happen on the 31st December this year. The continued standstill on these fundamental issues suggest a no deal Brexit is increasingly likely and something we should all be prepared for.
The Whitehouse team are experts in the potential impact of Brexit, providing political consultancy and public affairs advice to a wide range of clients, not only in the United Kingdom but also across the member states of the European Union. More information about our Brexit experience can be found here, or, if you have any questions, please contact our Chair, Chris Whitehouse, at email@example.com