500 pages long... the historic dossier that’s set Britain free
(And we’ve digested it so you don’t have to!)
AFTER a year in the making, the historic agreement between Britain and the EU was signed by Boris Johnson and Ursula von der Leyen at 2.30pm on Thursday. Five hundred pages long – and not yet published – it sets out the future relationship between the UK and the continent. Policy Editor DANIEL MARTIN looks at the deal and its key provisions:
TRADE
■ First zero-tariff, zero-quota trade deal in EU history
■ There will be no tariffs on the movement of goods between the UK and the EU, and no limit on the quantity of any types of goods that can be traded
■ Agreement covers crossborder trade worth more than £600 billion a year
■ But a slew of non-tariff barriers will come into force, including extra customs checks and forms ÷ And there could be tariffs in future if there are disputes over state aid or standards
■ Britain can sign free trade deals with other countries, because it has left the single market
VERDICT: A UK win. Britain is given highly advantageous access to the single market for a country which is outside it – avoiding the threat of 10 per cent tariffs which would have come in under No Deal. Mr Johnson likened it to the ‘Canada-plus-plus’ arrangement he had been striving for.
CUSTOMS AND RED TAPE
■ New regulatory burdens will make it more costly to do business in the EU, such as new ‘rules of origin’ regulations which mean UK firms must self-certify the origin of exports to the EU
■ But both sides agree to limit customs red tape, including new ‘trusted trader’ rules to speed things up at the border
■ Extra cooperation at ‘roll-on roll-off’ ports such as Dover and Holyhead to minimise disruption
■ Specific agreements to make trade in wine, pharmaceuticals, cars and chemicals easier
VERDICT: A narrow win for the EU. Britain had argued for trade to be as ‘frictionless’ as possible, but this deal means there will be some significant non-tariff barriers
AUTOMOTIVE INDUSTRY
■ British car manufacturers can use parts from overseas
■ UK car firms in the North East will be able to source 60 per cent of their parts from outside the UK and the EU – and still export them to Europe
■ This level will be reduced in subsequent years, allowing companies to adapt
VERDICT: A win for UK. The EU had wanted no transition period
SUBSIDIES AND STATE AID
■ Both sides must be transparent about subsidies they give businesses, to ensure firms don’t get an unfair advantage
■ The EU and the UK must set up an independent authority to oversee state aid
■ There is no set limit for how much state aid qualifies as a problem, and disputes will be resolved on a case-by-case basis
VERDICT: A draw. Britain is not bound by the EU ‘state aid’ rules which regulate how much help governments can give companies – but on the other hand, it does not have complete freedom
FINANCIAL SERVICES
■ Free movement of services will end, meaning British firms will have to comply with varying rules across member states
■ No decision on ‘equivalence’, which would allow financial firms such as banks to sell their services into the EU single market from the City of London
■ No joint declaration to support enhanced cooperation on financial oversight until at least March
VERDICT: A win for the EU. Services are worth 80 per cent of British exports and they are not covered in the agreement, putting Brussels in the driving seat
LEVEL PLAYING FIELD
■ No commitment to ‘dynamic alignment’ or anything which would force the UK to mirror European standards
■ Both sides agree a ‘non-regression’ clause which means they must not lower their standards in a bid to undercut each other on trade
■ This applies to environment rules, social and labour standards, and tax transparency
■ Britain agreed to a ‘rebalancing mechanism’ under which the EU could hit back with tariffs if the UK takes action which puts its firms at an unfair advantage
VERDICT: Narrow win for the UK. The Government will not have to move in lock- step with EU changes to standards, but the UK will have its access to the European market reduced if it diverges too far – and it cannot fall below agreed standards to give itself a competitive advantage
DISPUTE RESOLUTION
■ No role for the European Court of Justice
■ Either side can hit the other with tariffs – but if one side thinks the decision is unfair they can take it to an arbitration panel
■ A Partnership Council of EU and UK representatives will oversee the implementation of the agreement
■ If there is no agreement, an international arbitration tribunal, chaired by an independent figure, will make a binding decision
■ Tariffs can be imposed only by the arbitrator, and the EU cannot unilaterally impose ‘lightning tariffs’
VERDICT: A clear UK win. This was a key demand: that the UK should remain outside the scope of EU law. The new dispute mechanism will be based on international law. Mr Johnson also saw off EU demands for a ‘ratchet clause’ which would have allowed the EU to impose uni÷ lateral tariffs if it was unhappy at our standards or state aid
FISHING
■ Britain will take back 25 per cent of the current EU fish quota, worth £146 million a year
■ But this will happen only after a transition period of five and a half years, to allow EU fishermen to seek other fishing grounds
■ At the end of this period, the UK will be in charge of about two thirds of its catch
■ From 2026, there will be annual negotiation on the extent of European access
■ EU dropped its ‘hammer’ demand that it could impose sanctions across any sector it wished if it did not get what it wanted on fishing
VERDICT: A narrow EU win. A significant compromise from the UK following the most intractable part of the discussions. Mr Johnson had wanted 80 per cent of the EU quota back after three years, but in the end he had to agree to even lower than his final 35 per
cent offer. British fishermen will be in a better position than they were, but the agreement will still be a bitter blow. Brussels dropped its demand that fisheries and the trade deal be linked, removing the threat of UK firms being denied access to the single market following fish disputes
AGRICULTURE
■ Farmers will benefit from zero tariffs and zero quotas
■ But UK agrifood consignments will have to have health certificates and undergo sanitary controls
■ Both sides can maintain their own sanitary standards
VERDICT: UK win. The zero tariffs agreement is much better than the equivalent under WTO rules, which could have seen tariffs of up to 40 per cent imposed
AVIATION AND TRUCKING
■ The EU has not granted automatic recognition to British aerospace designs and products
■ This will not happen until the EU gains confidence in the UK’s capability for regulation
■ Both sides commit to efficient management of visa and border arrangements for hauliers
VERDICT: Narrow EU win. Britain had hoped for greater agreement on aviation
CRIME, SECURITY AND EXTRADITION
■ Cooperation on investigation into terrorism and serious crime
■ Britain will no longer have realtime access to DNA, fingerprint and airline passenger information, but will receive them quickly
■ Britain loses membership of Europol and Eurojust, but the UK will cooperate with them
■ Close cooperation on extraditions but with further safeguards beyond the European Arrest Warrant
VERDICT: UK win. Remainers had often said it would be impossible to reach such a deal without submitting to the European Court of Justice. That has been achieved, and the UK also retains the right to deport foreign criminals
TRAVEL AND MIGRATION
■ Holidaymakers can visit the continent for 0 days without a visa
■ No work permits for business travellers, who can also travel to EU for 90 days in any 180day period
■ EU pet passports no longer valid for UK residents
■ End to free movement of people with the EU; replaced by a points-based immigration system
VERDICT: Another UK win. One of the key promises of the Vote Leave campaign was that Britain would be able to set its own immigration policy
EDUCATION AND QUALIFICATIONS
■ Britain will not take part in the Erasmus university exchange programme, replacing it with a less-expensive ‘Turing’ scheme ÷ No automatic mutual recognition of professional qualifications, such as doctors, vets and engineers
■ Provides a framework for future recognition
■ Agreement on recognition of lawyers’ qualifications
VERDICT: EU win. UK had wanted ‘comprehensive coverage’ on the mutual recognition of professional qualifications
HEALTH AND SOCIAL SECURITY
■ European Health Insurance Cards (EHIC) will still be valid, allowing British nationals to access free healthcare on the continent
■ Coordination of various social security rules, allowing those living abroad to access pensions
■ Agreement prevents the export of child benefits
VERDICT: UK win. Britain will retain control on social security benefits to EU migrants while ensuring holidaymakers can access free healthcare
NORTHERN IRELAND
■ The province will have to follow single market rules to ensure its border with Ireland remains open
■ Customs procedures for goods crossing the Irish Sea, because Northern Ireland will have access to the EU customs union while remaining in the UK customs union
■ There will be physical checks on some plant and animal products, but not at the border
■ Ulster will remain subject to many EU rules overseen by the European Court of Justice
VERDICT: A compromise. This was what Mr Johnson had to agree to so the UK was not subject to the backstop which scuppered Theresa May’s deal
BREAK CLAUSE
■ After four years, the whole deal could be terminated if either the UK or the EU believes it is not working
■ The entire trade deal can also be reopened if the two sides cannot resolve a serious dispute
■ Individual chapters of the trade agreement can also be reopened if there are disputes
VERDICT: UK win. This ensures British sovereignty is maintained if it is unhappy with the way the agreement works out. It ensures the UK will not be subject to unilateral sanctions from Brussels