28 February 2018

The European Commission today tabled its draft legal text for the UK-EU Withdrawal Treaty, which includes various provisions on the transition period, the rights of UK/EU nationals, and the UK’s commitments to the EU budget. However, the most controversial issue is the status of Northern Ireland post-Brexit, set out in a protocol to today’s text.

Both the UK and the EU say they want to avoid a hard border between Northern Ireland and the Republic. But with no agreement over how this should be achieved, the issue again threatens to collapse the wider UK-EU negotiations, just as it did in December. The December deal largely fudged the issue in a joint report, with a compromise that contained inherent contradictions.

However, while these contradictions were noted at the time, both sides signed up to all aspects of the deal in December, and the EU’s text today clearly relegates the commitment to the UK’s constitutional and economic integrity behind that of avoiding a hard border.

The December deal on the Irish border rested on a fudged compromise

Paragraph 45 of the December agreement made clear the UK’s “commitment to preserving the integrity of its internal market and Northern Ireland’s place within it, as the United Kingdom leaves the European Union’s Internal Market and Customs Union.” Some may argue that a hard border could be avoided if the UK opted to join a new customs union with the EU but it’s also clear from paragraph 45 that the UK is leaving the Single Market too and this will also lead to issues for the Irish border.

The December deal (Paragraph 49) provided for three possible options for avoiding a hard border with the Republic:

  1. Achieving this objective “through the overall EU-UK relationship”
  2. The UK proposing “specific solutions” to address the unique circumstances of the island of Ireland. The UK set out some ideas in a position paper.
  3. And, finally, that “In the absence of agreed solutions, the United Kingdom will maintain full alignment with those rules of the Internal Market and the Customs Union which, now or in the future, support North-South cooperation, the all-island economy and the protection of the 1998 Agreement.”

This final ‘backstop’ position (option C) is the preferred option of the Irish government and the EU. At the insistence of the DUP, the option of alignment with the EU’s Internal Market and Customs Union was caveated with the proviso that “no new regulatory barriers develop between Northern Ireland and the rest of the United Kingdom, unless, consistent with the 1998 Agreement [the Good Friday Agreement], the Northern Ireland Executive and Assembly agree that distinct arrangements are appropriate for Northern Ireland.”

The proposed EU text is clearly unacceptable to the UK and the DUP in particular

Today’s text is the EU’s proposal for turning the December deal into legal commitments. Is provides a detailed outline of what it thinks Option C) should look like but it does not restate the December deal’s acknowledgement that any solution must not alter Northern Ireland’s position vis-à-vis the rest of the UK. Meanwhile, the only reference to Options A) and B) in the December deal are to be found in Article 15 of the Protocol, which acknowledges that other solutions might be found in a “subsequent agreement” between March 2019 and when the transition period is due to end in December 2020. In which case, Option 3 would not apply, or at least only in part.

The way in which Option C – previously couched as “alignment with those rules of the Internal Market and the Customs Union which, now or in the future, support North-South cooperation, the all-island economy and the protection of the 1998 Agreement” – has been interpreted by the EU could certainly be described as maximalist. There was no agreement or definition of what “alignment” should entail. However, this proposal has been interpreted by the EU to mean that Northern Ireland remains in the EU’s Customs Union and large parts of the Single Market, namely for all goods and other areas such as electricity.

This would mean a hard border between Northern Ireland and the UK, unless, of course, the entire UK remained in customs union with the EU. But, even then, customs union would not necessarily provide a full solution since the majority of potential border checks result from regulatory issues rather than the simple collection of tariffs.

The Protocol would also establish a “common regulatory area” between Northern Ireland and the EU. The annex – referring to EU rules on customs, VAT excise duty, standards for agriculture and fisheries, electricity markets and environmental protection, illustrates how comprehensive this would be. Article 12(5) states that “Authorities of the United Kingdom shall not act as leading authority for risk assessments, examinations, approvals and authorisation procedures provided for in Union law made applicable by this Protocol.” Presumably this would mean UK regulators would lose many of their powers within Northern Ireland?

In addition, Article 11 states that the Protocol’s provisions on the “common regulatory area” would be overseen by the EU institutions, agencies and fall under the jurisdiction of the EU’s Court of Justice. This would subject large swathes of the Northern Irish economy to extra-territorial control from Brussels.

Where do the talks go from here?

The EU is using the issue of the Irish border to push the UK towards its preferred outcome in the negotiations: the UK as a whole remaining in customs union with the EU – and, by extension, large parts of the Single Market. The fact that this week started with Labour leader Jeremy Corbyn calling for just such a policy – albeit with the unconvincing rider that the UK can meaningfully influence future EU trade negotiations – only compounds the strong-arm tactics. Meanwhile, Irish Taoiseach Leo Varadkar has urged Sinn Fein to take their seats in Parliament for the first time in order “to make things better for Ireland.”

The Irish border issue is evidently complicated and there is no easy solution. The UK has signalled willingness to discuss a high degree of alignment with the EU’s regulatory framework and customs procedures. The likelihood is that this will mean a slower divorce from the EU than would otherwise have been the case. But the path to a compromise is not aided by today’s intervention by the European Commission – after all this is supposed to be a joint text which is still subject to negotiation with the UK.

Given the fraught internal UK negotiations with the DUP to get the December deal over the line, which was conditional on the firm commitments to the UK’s constitutional integrity, the EU has needlessly raised the stakes. The entire premise of avoiding a hard border is to avert potential political instability on the island of Ireland. How would the EU expect Unionists in Northern Ireland to react if the UK were to agree to this text?