EU deal to be ‘worse than Japan’
THE EU is preparing to offer the UK a trade deal on tougher terms than those of Canada, Japan and a host of other leading trade partners, The Daily Telegraph has learnt.
In what will be seen by industry as an unusually harsh move, the European Commission warned EU member states it would be a mistake to allow some UK industry bodies to certify that goods conform to EU standards.
Mutual Recognition Agreements (MRAS) are granted to key EU partners to facilitate the smooth movement of goods in key areas, but could be withheld if the UK seeks only a basic deal.
The commission’s uncompromising stance surprised even some EU member states when they met on Jan 10 to discuss future trade with the UK, according to an account of the meeting obtained by The Telegraph. Two senior EU sources separately confirmed the approach, which risks hitting the medicine and car industries hardest.
“We will not blindly delegate the recognition of EU standards. Companies have had plenty of notice about how to get certified in the EU,”
explained an EU official familiar with the discussion.
An EU diplomatic source confirmed the position was motivated by a desire to avoid anything that might enable the UK to retain easy access to the single market while being free to diverge and seek competitive advantages.
“Why would we rush into providing the UK a competitive edge to have the UK as an authorised testing lab on our shores?” added the source, noting that if the UK shifted to a closer relationship, MRAS might still be possible.
But there was little sign yesterday of the UK softening its demands for clear divergence from EU trade rules when Sajid Javid, the Chancellor, doubled down on a promise that the UK would “not be in alignment” with EU rules.
“We will not be in the single market. We will not be in the customs union. We will not be rule-takers,” he said on a visit to Brussels, while maintaining that the UK still aspired to “a deep and comprehensive free trade agreement”.
At the same time, in a signal of its determination to embrace global trade after Brexit, the UK is expected to publish its ambitions for a US-UK trade deal later this week.
At the World Economic Forum in Davos, Donald Trump, the US president, heaped praise on “wonderful” Boris Johnson, adding that the United States looked forward “to negotiating a tremendous new deal with the United Kingdom”.
Despite UK bullishness about a possible trade deal, the EU has warned that it will negotiate only a very basic deal by Dec 31, and will not grant “zero tariff” access to European markets if Britain is not willing to agree to follow rules set by Brussels on the provision of state subsidies and environmental controls.