As the end of the EU transition period approaches on December 31 of this year, the UK, which has yet to reach agreements with the EU on future trade and other areas of cooperation, is again facing the threat of a “no-deal Brexit” countdown. The British, who have always prided themselves on their sense of humor, have begun to joke that the Brexit countdown is becoming a holiday routine similar to Christmas.
Against the backdrop of the failure of negotiators from both sides to resolve the last three major disputes on December 7, British Prime Minister Boris Johnson decided to travel to Brussels himself in the coming days to break the deadlock after a phone call with European Commission President Ursula von der Leyen on the same day.
As the leaders of the 27 EU countries will also hold a summit in Brussels from 10 to 11 October, Johnson arrived in Brussels on the 9th. Irish Foreign Minister Coveney (Simon Coveney) pointed out that if there is no agreement on the 10th, EU leaders will prepare an emergency response plan for a no-deal Brexit, seemingly hinting that the 9th will be the final deadline for whether the UK-EU negotiations will break down.
All Parties Blow Down the Wind
As for Johnson’s personal meeting with von der Leyen, the British media received mainly negative news from government sources. The Guardian, for example, was told that the positions of the two sides were the same as they had been on April 4, and that it was very unlikely that Britain and Europe would be able to reach an agreement. News from the EU also indicates that negotiations are difficult and that national leaders are becoming increasingly frustrated.
A brief joint statement by Johnson and von der Leyen after a 45-minute phone call Monday also said the two sides still have “significant differences” on the level playing field, the agreement’s enforcement mechanism, and fisheries, and have fallen short of completing a deal. The two men did not commit to resolving their differences, saying only that they had asked their respective negotiating teams to prepare a summary of their differences for discussion when they met.
Only a handful of people know the details of the negotiations. However, it is widely believed that most of the agreement is long overdue for confirmation, except for guarantees of a level playing field, enforcement mechanisms, and three long-standing issues of fishing rights in British waters that have yet to be resolved. Of these, the details of the dispute over fishing rights have received particular media attention – yet the fishing industry accounts for less than 0.1% of the UK economy.
Fair competition and enforcement mechanisms are “sovereign issues”.
Let’s start with the “level playing field”. The EU has long been concerned that after Brexit, the UK will use state subsidies or lower environmental and labor protection standards to reduce the cost of production of British products and services, and then use the ease of access to the European market to create unfair competition for EU enterprises.
On the one hand, the EU agrees that there will be differences between the UK and the EU in terms of regulations and standards in the future, but on the other hand, it hopes that such differences will not result in inconsistent standards between the UK and the EU, and therefore proposes an “evolution mechanism” to harmonize the various regulations in the future, and requires that if one side insists on not allowing it, the other side can unilaterally restrict market access for goods or services that fall below its own standards.
The U.K., of course, is unhappy that this is a disguised restriction on the sovereignty and freedom of the U.K. after it leaves the EU’s single market, and argues that the EU’s trade agreements with other countries do not have such strict requirements.
On December 5, Michel Barnier, the EU’s chief Brexit negotiator, left his hotel in London and returned to Brussels, Belgium.
On the one hand, the UK is reluctant to accept any jurisdiction from the European Court of Justice (ECJ) and, on the other hand, refuses to accept cross-economic retaliation (e.g., the EU retaliating against the UK for non-compliance with fisheries agreements with commodity tariffs).
Since disputes between the UK and the EU are likely to involve the interpretation of EU regulations, it seems difficult to avoid the jurisdiction of the European Court of Justice, which has the ultimate power of interpretation; on the other hand, cross-cutting retaliation is a permissible practice in the World Trade Organization (WTO), and it is difficult for any reasonable and more comprehensive trade agreement to step outside this framework.
Both of these controversies involve too much international trade and legal detail for the average British citizen to relate to beyond the slogan-like understanding of “pro-sovereignty. However, fishing rights in British waters are a different matter.
Fishing rights at the heart of the dispute?
Currently, under the Common Fisheries Policy (CFP) quotas, nearly 60% of the catch by tonnage in British territorial waters (up to 12 nautical miles from the territory) and the exclusive economic zone (EEZ, up to 200 nautical miles) is taken by foreign vessels, worth about 650 million euros a year. At the first glance of this figure, Europeans feel that the EU is failing British fishermen – the slogan “pro-sovereignty” is immediately and concretely reflected.
The latest British offer is reportedly to allow the EU to maintain its current fishing quotas in the EEZ waters for the next three years, after which its quotas will be reduced by nearly 80 percent and EU fishing vessels will be banned in British territorial waters from the start. In contrast, the European offer is more than four times smaller than the British offer.
French President Emmanuel Macron has been accused of taking a tough stance on Brexit negotiations and may use his veto power to veto the deal.
On the other hand, 55% of the UK’s own fishing quota, at 2019 values, is controlled by companies in Iceland, Spain, the Netherlands and other countries. From January of next year, these British fishing vessels that are in foreign hands will not be able to obtain fishing quotas as British. These quotas, which date back to the 1990s, were sold off as long-term investments. At the moment, the British plan to cancel has caused major discontent in the European Union.
In the midst of all this controversy, some British diplomats have pointed out to the media that the UK and the EU are living on “different planets”.
However, the tensions and the atmosphere of the looming no-deal Brexit crisis are probably just a “staged” negotiation between the UK and the EU, either intentionally or unintentionally.
Rational Compromise is Inevitable
First, against the backdrop of a devastated economy in the midst of the epidemic, neither the UK nor the EU has any incentive to take the economic hit of a no-deal Brexit, especially since the UK’s economy is expected to contract by as much as 10.1% this year.
Secondly, the Johnson administration, which is currently trying to overturn last year’s Brexit commitment to Northern Ireland with domestic legislation, also changed its position on Monday, stating that if the negotiations between Britain and Europe are successful, it will withdraw the relevant provisions that violate international law, seemingly laying the groundwork for a scenario in which both sides finally make their own concessions before reaching a consensus.
Johnson had said the U.K.-EU agreement was almost ready to be sent to the oven, and now it’s the countdown to a no-deal Brexit.
More importantly, the current three challenges do not appear to be necessary points of contention. Whether it is the guarantee of fair competition or the enforcement mechanism, unless the UK is really going to “fight a trade war” with the EU in the future, these mechanisms are likely to remain as legal provisions – and in the absence of mutual trust, the existence of legal safeguards between countries. The actual impact is not really significant.
The issue of fishing rights, however, does have a degree of controversy in the UK, Belgium, France and other countries. However, to give up the entire Anglo-European agreement for the benefit of hundreds of millions of euros per year is not in line with the instrumental rational considerations.
From this point of view, the atmosphere of “negotiation on the edge of the cliff” is probably just a play that both sides (especially the British side) play for their respective internal publics to watch, so that they can make concessions at the last moment of crisis “for the sake of the greater good” leaving a step down, so as to show the potentially damaged interests of both sides, or the ideologically dissatisfied public that they have worked hard to fight.
Such public relations tactics can be considered a common strategy in multinational negotiations in Brussels. However, there is no denying that it also carries the risk of becoming a real thing.
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