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L ‘Brexit Agreement reached in extremis before December 31, it was greeted with enthusiasm and relief.
Without a minimum of trade agreement Between UK me European Unionin fact, it would have been a total rupture of relations, with inevitable negative consequences for companies and citizens.
However, the painstakingly achieved compromise left ambiguous gaps and shadows that could translate into further friction and blow up the entire tuned mechanism.
There are at least 5 items on the balance sheet, of which the Brexi it could still offer nasty surprises.
Brexit: the agreement and its weaknesses
The London-Brussels trade deal has raised markets and guaranteed a more optimistic horizon for the Economic recovery.
For British companies, for example, the deal was a victory, as it avoided the prospect of punitive tariffs and a chaotic no-deal separation from the UK’s biggest trading partner.
However, the agreement leaves important problems unresolved and runs the risk of reigniting friction between the partners. In evidence, at least 5 topics be monitored and on which Brexit failure it can still be revealed.
1. Competition and equal conditions for companies
The equal footing, necessary to ensure fair competition between companies, was one of the thorniest parts of the negotiations. The agreed compromise allows the UK to not align with EU laws, but the blockade can enforce rates proportionate, subject to arbitration, if it shows that the counterparty’s actions distorted fair competition.
The “trade charges” issue between the UK and the EU is still far from resolved and is a live issue. Not only that, the agreement also contains a review clause that allows both parties to periodically renegotiate this part of the treaty if they are not satisfied with the way it is used.
The trade agreement therefore it may still fail in the future if the UK or the EU decide that it is not working.
2. Finance
The agreement offers little clarity for the financial companies. There is no decision on the so-called equivalence, which would allow companies to sell their services in the EU single market from the City of London.
The agreed text contains only standard provisions on financial services, which means that it does not include commitments on market access.
Johnson stated that the agreement “maybe not as good as we would likeOn financial services, in a rare admission that his strategy in the talks had failed.
The Treasury should negotiate a memorandum of understanding with the EU as an urgent priority in 2021 on finance and London will continue talks with Brussels on access and equivalency of financial services, Chancellor of the Exchequer Rishi Sunak said on Sunday.
3. Data flow
The UK and the EU have only agreed on a temporary solution to maintain the data flow between their territories. During an interim period of up to six months, information may continue to be transferred until separate legal agreement.
EU officials said the so-called data adequacy decision, which would certify that the UK’s protection standards are comparable to the lockdown, could be made in early 2021.
4. Right to fish
One of the most difficult obstacles to overcome was the chapter on fishing. The Brexit trade deal provides for a five-and-a-half-year transition period during which EU fish quotas in British waters will decrease by a 25%.
However, the problem has not been fully resolved. The compromise gives both the UK and the EU the right to impose reciprocal duties on capture if they can show that any future reduction in access to water causes economic or social harm.
Fishing remains a hot topic and there will be pressure on the UK government to lead a hard line when it takes place. next talks.
5. Gibraltar
The UK and the EU have yet to reach a Gibraltar agreement, the British territory connected to mainland Spain.
Without an agreement, crossing the border could be more difficult, which could cause long lines of passengers and significant economic disruption. About 15,000 workers cross the border every day.
Any attempt by Spain to erode or even end British control of the territory has drawn criticism from conservatives, including former leader Iain Duncan Smith, who will fight hard to prevent the UK from giving concessions.
