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Friday, December 25, 2020
You have to know that now
What does the “Brexit” package mean in concrete terms?
So it’s not a “no deal”, but not a soft landing either. The trade and cooperation agreement between Brussels and London avoids the most difficult complications of Britain’s exit from the EU. We answer the most important questions about Brexit.
In the last minute of Christmas Eve, Brussels and London brought their post-Brexit transition trade pact across the finish line. The more than 1,200-page document regulates issues related to trade, cooperation between the police and the judiciary and the protection of medical insurance for travelers in case of emergency. The most important questions:
So it’s not a no-deal, but is this a soft Brexit? No. The soft landing, which many in the EU had long expected, was off the table with Boris Johnson’s electoral victory last year at the latest. Britain is leaving the internal market and the customs union and is significantly further out of the Brussels orbit than, for example, Norway or Switzerland. Business associations on both sides of the English Channel expected much more. Cooperation is limited to a minimum. So Brexit is pretty tough. But this is not a fall off the cliff with chaotic consequences for the economy and people.
What does this mean for retail? It will be considerably more difficult than before. Businesses on both sides will have to deal with a lot more paperwork. Although the trade pact does not impose any customs duties on British products in the future, British exporters to the EU have to laboriously demonstrate since the turn of the year that their products were mainly manufactured in their own country. In future, proof of compliance with EU food safety regulations and compliance with product standards will also need to be provided.
The British government has announced that it will initially ignore everything that comes from the EU. Only gradually should articles be presented and checks carried out. But things are different on the EU side. The French government announced on Friday that it would “massively” inspect British products from the turn of the year. For the service industry, which accounts for around 80 per cent of the UK’s gross value added, accessing the European domestic market will be considerably more difficult with the end of the Brexit transition phase on December 31.
Why was the subject of fishing so difficult? Although fishing is of little economic importance, it was the most difficult issue to resolve. This has to do with the strong focus that the UK government put on sovereignty and control in the negotiations. Britain must regain its independence – that has been the mantra of Brexiters since the 2016 referendum. Control of its own fishing waters has become the most powerful symbol of this. Still, London made big concessions in the negotiations. European fishermen initially only have to give up a quarter of their catch quotas, over a period of five and a half years. If London further restricts their access later, Brussels could respond with fees.
What was the last problem? Another sensitive issue was the issue of a level playing field. Brussels wanted to prevent the British from lowering their labor rights and environmental protection standards and thereby gaining an unfair competitive advantage. The risk of London rules “freezing” should also be avoided as they continue to rise in the EU over the years. If this is the case, it should now be verified by an independent party. If necessary, the EU could react with tariffs to protect its market.
What do the British expect from leaving the EU? The withdrawal of the customs union allows Great Britain to conclude free trade agreements with third countries such as the United States, India and China on its own initiative. Prime Minister Boris Johnson also wants to make the country the world’s leading location for the technology of the future. The UK should become a “Saudi Arabia of wind energy” and a “superpower for science and research,” he announced. Electric mobility and artificial intelligence are areas London wants to heavily subsidize. This is probably why the British government has steadfastly resisted submitting to the EU rules on state financial aid. However, the British have yet to adhere to a common framework.
The bottom line is that the economic damage caused by Brexit cannot be repaired with anything, according to experts. Therefore, Brexit is seen primarily as a political project driven by yearning for the golden age of the British Empire. Furthermore, leaving the EU was the vehicle for a fundamental change in the political landscape in Britain, in which a group within the ruling Conservative party, marginalized until the referendum, took office.
What will change for Germans traveling or emigrating to the UK? The free movement of people between the EU and Great Britain ends on December 31, 2020. This means that anyone who wants to work and live in Great Britain in the future must apply for a visa. This will be regulated by a points-based system influenced by factors such as income level and industry. There will be no visa requirements for tourists on shorter trips. The good news is that the European Health Insurance Card (EHIC) will remain valid under the agreement until it expires. In the future, travelers should be able to make use of their health insurance coverage in their country of origin in case of emergency. Not regulated in the deal, but still important to tourists in the UK, the major phone providers likely won’t want to charge roaming fees.
Will Brexit jeopardize peace in Northern Ireland? The risk of having to introduce border controls between Northern Ireland, which belongs to the United Kingdom, and the EU member state Ireland, was already avoided in the exit agreement. At the event, a resurgence of conflict was expected between the mostly Catholic supporters of a union of the two parts of Ireland and the predominantly Protestant supporters of the union with Great Britain in Northern Ireland. After the London government initially questioned the regulation of the retirement agreement with a bill, it has since relented. This gives Northern Ireland a special status and it remains more closely linked to the EU than the rest of the Kingdom.
What does the agreement mean for police and judicial cooperation? Here both sides remain relatively close together. The cooperation of the UK authorities with the EU agencies Europol and Eurojust will continue. But London can no longer help shape the rules of these agencies. There are also provisions for close cooperation between the British police and judiciary and those of the EU countries. In the future, the British will no longer have access to certain EU databases, such as the Schengen information system, in which, among other things, people who have been placed for their search are stored. However, the UK can still access the EU database to store passenger data, vehicle registration data or EU criminal records. We should also continue to work together in the case of cross-border health risks (see Corona) and the exchange of secret information.
What areas are not regulated in the Brexit trade pact? The subject of foreign and security policy was excluded from the negotiations at the request of the British government. “As of January 1, there will be no framework between Britain and the EU to develop and coordinate a coordinated response to foreign policy challenges,” reads a summary from the EU Commission. This applies, for example, to sanctions against people or the economy of third countries. There is also no automatic recognition of professional qualifications. For example, doctors, engineers and architects and many other professional groups will in the future have to prove their qualifications according to the rules of the individual countries in which they wish to work. Great Britain will no longer participate in the European Erasmus student exchange program.
What happens now? Due to time pressure you have to improvise. The commercial pact will initially be applied provisionally from January. The 27 EU states and some national parliaments must agree to this. The European Parliament will review the treaty retrospectively in January and could, in theory, reject it. The British Parliament is due to shake up the deal on December 30.
