4 May 2018

Brexit transition period extension could be necessary to implement customs union arrangements

At the Brexit “war Cabinet” sub-committee meeting on Wednesday, ministers have been reportedly told that both post-Brexit customs options proposed by the Government would require another four or five additional years to be implemented, which could see the UK staying in the EU customs union during an extended transition period until 2023.

Elsewhere, Brexit Secretary David Davis yesterday told the House of Commons that the UK will “100 percent” leave the EU customs union by the end of the transition period on December 31, 2020. Davis also said that both Government’s proposals for a UK-EU customs arrangement after Brexit are still being discussed, as “both have merits and virtues, both have some drawbacks and that’s why we’re taking our time over the discussion on this.” He added, “It’s frankly incredibly important that we get this right, not just for trade but for the extremely sensitive issue of maintaining the peace process in Northern Ireland. I don’t undertake to put an artificial deadline on something as important as that.”

Separately, Prime Minister Theresa May’s spokesman yesterday said that both proposals were being “refined,” adding, “Both of the options that we have put forward are serious propositions and we are taking time to get them right. We are absolutely confident we can agree a solution that works for all the parties involved.” Meanwhile, according to the Guardian, the Government would be trying to win the support of Defence Secretary Gavin Williamson for the Prime Minister’s preferred “customs partnership” option. Williamson was reportedly the least vocal in expressing doubts over this option during Wednesday’s meeting.

Elsewhere, the Sun reports that the Government is planning to delay the House of Commons vote on key Brexit Bills, including one on the future customs union arrangements, until after a Brexit deal is agreed with the EU in October. A Government source is quoted saying, “The PM’s thinking is why jeopardise everything by losing a customs union vote if we don’t have to. There is time to get the bills through after October, but it will be very tight.”

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The Times: Brexit negotiations could be suspended if no agreement on Irish border is found by June

EU officials have warned the UK that Brexit talks could be suspended if no acceptable customs solution is found by a meeting of European leaders in June that avoids the creation of a hard border in Northern Ireland, The Times reports. At a meeting last week, Irish Minister for Foreign Affairs Simon Coveney warned that Ireland would be ready to force a suspension of the talks if no progress is made, it has emerged. The Irish position reportedly has the full backing of Brussels. An EU source is quoted saying that now that the option of a customs partnership has been voted down in the British government’s Brexit war cabinet, “We [the EU] cannot see what better alternative could come that would come close to ‘a’ customs union.”

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New Lords EU Committee report urges UK and EU to propose post-Brexit dispute resolution mechanism

The House of Lords European Union Justice Sub-Committee yesterday published a report urging the UK and the EU to come up with “pragmatic proposals” for a dispute resolution mechanism which will replace the European Court of Justice throughout the Brexit process to enforce the Withdrawal Agreement, the transition period arrangements and post-Brexit UK-EU criminal justice cooperation. The report adds, “There will be no ‘one-size-fits-all’ mechanism for enforcement and dispute resolution [after Brexit]. This could mean that the UK would only be obliged to accept the jurisdiction of the CJEU [Court of Justice of the European Union] in specific and limited areas, for instance those involving direct cooperation with EU agencies, or within the field of justice and home affairs.” Chair of the EU Justice Sub-Committee, Baroness Kennedy of The Shaws, said, “If the UK wants to stay in key EU agencies, such as on medicines or aviation, it will have to ‘respect the remit’ of the CJEU.”

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Juncker asks Belgium to offer citizenship to British EU staff

During a debate in the European Parliament yesterday, European Commission President Jean-Claude Juncker urged Belgian Prime Minister Charles Michel to offer Belgian passports to all EU staff of British nationality that may demand one. After Brexit, UK citizens working for the EU in Brussels face the prospect of failing to meet one fundamental criterion to work in European institutions: nationality of a member state. Belgium has so far refused many requests of citizenship on the ground that EU staff hold quasi-diplomatic status outside the local tax system. Replying to Junker’s request, Michel fell short of providing reassurance, pointing out that “contradictory jurisprudence” exists on the subject.

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Wizz Air secures UK licence in preparation for Brexit

Hungarian low-cost airline Wizz Air has obtained British licences for its newly-created UK subsidiary. The company chief executive József Váradi said, “Brexit may give legal uncertainties so we need to plan legal contingencies… It’s safer to have a UK airline to make sure we preserve the rights we have been enjoying.” He added that the move would probably be superfluous as “In our view Brexit is going to be a well-managed process in the end.” Wizz Air UK headquarters will be based in Luton airport.

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WSJ: Berlin and Paris in dispute over how to handle trade negotiations with US

Germany and France are divided over whether to grant the US concessions to avoid a trade conflict, the Wall Street Journal reports. While Germany is willing to offer the US a deal that would include lower tariffs on American cars exported to the EU, France fears that any such offer could be interpreted as European weakness by Washington. A French diplomat is quoted saying, “It’s clear we don’t want a TTIP-light.” Meanwhile, the German government’s Coordinator for Transatlantic Cooperation, Peter Beyer, argued, “We need free trade negotiations limited in scope, TTIP-light if you will, or some arrangement on tariffs… We must take President Trump seriously. He means what he says.” The WSJ further reports that French officials are trying to extract concessions on Eurozone reform from Germany over the issue, an allegation French diplomats deny. The newspaper also reckons that a majority of European member states aligns with France on the trade issue.

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Belgian Prime Minister calls for EU mechanism to "peer review" adherence to rule of law

Belgian Prime Minister Charles Michel yesterday said the EU should set up a mechanism where each EU member state submits itself to a review of its adherence to rule of law practices by other member states. Michel said, “This review will help to develop good practices and correct deficiencies, in a collegial way,” adding, “Rather than a nasty battle over sovereignty that pits member countries against the EU, I choose another path, that of political and democratic primacy in EU members and within the EU.”

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English language to retain its importance in the EU post-Brexit

The section on EU administration of the document published by the Commission on Wednesday, presenting its proposal for the next EU long-term budget, makes clear that “The withdrawal of the United Kingdom will result in a limited reorientation of some functions within the administration, but the scope of activities will not change,” adding, “Translation and interpretation services in the English language will also remain unaffected.” This comes as speculation had mounted in the last months that English could lose its importance in the EU as a result of Brexit

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Enea Desideri: There are difficult negotiations ahead on the next EU budget

Commenting in a new blog on the European Commission’s proposal for the next long-term EU budget, Open Europe’s Enea Desideri writes, “While negotiating the MFF is always a delicate issue, the debate around the next one is likely to prove particularly contentious… The Brexit gap is likely to further exacerbate tensions that have traditionally emerged between net contributors and net recipients of EU funds.” After considering the main features of the proposed budget, Desideri concludes, “The Commission’s proposal reflects an attempt to keep everyone on board, balancing calls for change in the context of Brexit and a smaller EU, with contrasting demands pulling in the opposite direction,” but the initial reactions to the Commission’s proposal show that “the EU is in for intense negotiations before the final version of the MFF sees the light.”

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