Brexit is only one of the topics this weekend’s EU Summit has had to address.
Approving the massive 1.8 trillion budget, ensuring that the rule of law is respected by Poland and Hungary, agreeing a line on how to deal with Russia and Turkey, and giving teeth to its climate action plan are also on the agenda. Vital issues are at stake here for all 27 members.
This reduces the time that can be devoted to the seemingly interminable Brexit negotiations.
On paper the issues to be sorted out on Brexit are manageable. Sharing fishing rights, and policing state subsidies to industry, should not be deal breakers.
The real problem is lack of trust in the seriousness of any commitments the UK might give. There is a sense that the UK is more into the short term optics than the long term substance.
A Trade Agreement between the EU and UK would not be worth the paper it is written on, unless both sides have the same understanding of what the words in the Agreement mean. There also has to be a robust system for mediating and arbitrating disputes, that is consistent with the EU’s global trade policy..
Nobody wants a disruptive “No Deal”. But a poorly drafted, last minute, Agreement that, within a year, breaks down in a multitude of legal disputes would be no use.
This explains why France is looking for provision for rapid retaliatory action, if the UK backslides on the Agreement.
It also explains why European Commission is so promptly taking the UK to Court over the Internal Market Bill.
This Bill, passed by the House of Commons, gives the UK government power to break the Irish Protocol in the Withdrawal Agreement. The EU is suing the UK even though the Bill is not yet law, and the powers have not yet been used. This again illustrates a lack of trust.
The Commission objects a provision in the Internal Market Bill, which gives UK ministers powers to breach the Northern Ireland protocol on state aid and customs duties. Even taking the power to this is seen, in itself, as a breach on the Withdrawal Agreement.
The UK is still be subject to EU law, although no longer an EU member, up to 31 December 2020. During this period, the Commission has the power to use EU remedies to enforce the Withdrawal Agreement. This is what the Commission is doing by taking this case.
It has decided to act straight away, because it believes the UK needs to be made to understand that the EU takes the literal meaning of words in Agreements very seriously..
The UK has one month to reply to the notice of proceedings and if its answer is not satisfactory, the Commission can take the next legal step. The end game would be a lump sum and/or penalty payment by the UK imposed on the UK by the European Court of Justice (ECJ).
The EU target is not the detail of the Internal Market Bill, it is the breach of good faith. Article 5 of the Withdrawal Agreement requires the UK , in good faith, to take
“all appropriate measures, whether general or particular, to ensure fulfilment of the obligations arising from this agreement and refrain from any measures which could jeopardise the attainment of the objectives of this agreement”.
The offending portions of Internal Market Bill do the direct opposite. They take powers to allow the UK NOT to honour Article 5!
The Commission also is acting because it has to be seen to enforce Treaty obligations on members and ex members alike.
Some EU member states (eg. Hungary and Poland) are threatening to breach the rule of law in other matters. So the Commission cannot be seen to let the UK get away with the same thing . It has to be seen to be consistent.
There is another issue that could lead to a problem with the UK Conservative government when it gets down to finalising the text of any Free Trade Agreement with the EU, and having it approved on the Tory backbenches.
This is the continuing role of the European Court of Justice (ECJ) after 1 January 2021.
The rule of the ECJ will still apply to the UK, in the following matters
- cases pending at the end of the transition period and relating to events that took place before that,
- cases to do with citizens’ rights, for which the ECJ will remain partly competent;
- EU budget legislation (‘financial settlement’), that is financial commitments to which the UK committed when it was an EU member state,
- parts of the Protocol on Ireland/Northern Ireland and
- UK army bases in Cyprus
For Brexiteers, any continuing role for the ECJ is allergic. It is the sort of thing Jacob Rees Mogg railed against when Teresa May was Prime Minister.
In addition, the ECJ will have a role, albeit indirect, in any settlement mechanism designed to resolve disputes under the Trade Agreement, if there is one.
If there is a dispute, either the UK or the EU may bring the dispute to an arbitration panel. If that does not work, and the interpretation of EU law is at issue, then the ECJ will have to make that interpretation.
This is normal under EU Trade Agreements. It is in Agreements the EU signed with Ukraine, Georgia and Moldova.
This provision is there to ensure that EU law is interpreted in a consistent way across all agreements involving the EU. There cannot be one law for the UK and a different one for Ukraine.
Although logical in its own terms, this will be a hard sell for Boris Johnson.
His political authority has been reduced by Covid and the restrictions it is imposing on some parts of the UK. Despite his large parliamentary majority, he may even have to seek Labour support to get a compromise with the EU through Parliament.
But, with the UK economy in difficulty, he may have no choice. The stakes are high.