Eszter Kantor: Our EU Expert Decodes The European Commission's Proposal For The Brexit Transition Period & Fashion Roundtable's Asks.

Eszter Kantor: Our EU Expert Decodes The European Commission's Proposal For The Brexit Transition Period & Fashion Roundtable's Asks.

Eszter Kantor, our EU Expert has analysed The European Commission's proposal for the Brexit transition period which was published today.

We need the same from the UK Government and we at Fashion Roundtable have done so, asking for these 3 key asks and clarity from the UK Government:-

1) The UK Government to publish its offer for the transition period, as it would at least provide some guidance for businesses regarding the government`s targets for the next couple of years. 

2) Please be aware that non-tariff barriers (such as diverting regulations and standards, different certifications etc.) are more costly for businesses than tariffs.  

3) Visa-free access to the EU for people working in creative industries. 
We at Fashion Roundtable have ambitions to have a network to cover the accountability of fashion stakeholders, so we can ask for visa-free access. We are partnered with #FreeMoveCreate http://freemovecreate.org, the campaign led by ISM http://ism.org on freedom of movement for creatives and we urge you to also join your name or business to their campaign.

So what does The European Commission's proposal for the transition period say? 
https://ec.europa.eu/commission/sites/beta-political/files/transition.pdf

Eszter: "It formally offers the UK a continuation of current conditions, without granting it any say in legislative decisions, including the formulation and implementation of those EU policies that would come into effect during the transition period.
This of course can create complicated scenarios as reflected by this paragraph:
“Unless otherwise provided in this Part, during the transition period, any reference to Member States in the Union law applicable pursuant to paragraph 1 shall be understood as including the United Kingdom.
However, where acts of the Union provide for the participation of Member States, nationals of Member States or natural or legal person residing or established in a Member State in an information exchange, procedure or programme and where such participation would grant access to sensitive information that a third country or natural or legal person residing or established in a third country is not to have knowledge of, these references to Member States shall be understood as not including the United Kingdom.”
 

It also means that the UK Parliament and the Bank of England will not be considered, consulted and involved  in decisions over strategic and political matters: “For  the  purposes  of  the  Treaties,  during  the  transition  period,  the parliament  of  the  United Kingdom shall not be considered to be a national parliament.
For the purposes of Articles 282 and 283 TFEU and of Protocol (No 4) on the Statute  of the European system of central banks  and  of  the  European  Central  Bank,  during  the  transition period, the Bank of England shall not be considered to be a national central bank.”

 
It also requires the UK to abstain from any action or initiative which is likely to be prejudicial to the EU`s interests. This last one is a tough ask which will be difficult to monitor even if it remains in the final agreement and it will be even tougher for any UK politicians to sign on to as it may require them in certain situations to put the EU`s interest above the UK`s.   
 
The UK would also be required to abide by the decisions of the European Court of Justice (ECJ). Here, the Commission has inserted a footnote allowing themselves to use economic measures should HMG deviate from EU policies and considering that ECJ procedures can take years.
“In addition, the Governance and Dispute Settlement Part of the Withdrawal Agreement should provide for a mechanism allowing the Union to suspend certain benefits deriving for the United Kingdom from participation in the internal market where it considers that referring the matter to the Court of Justice of the European Union would not bring in appropriate time the necessary remedies.”
 
This last paragraph encapsulates perfectly the extreme fragility of the Brexit process. Will the EU be constantly looking at the UK whether or not it is maintaining full alignment with EU policies or will they start an investigation every time a stakeholder complains of regulatory discrepancy? Even if they do implement these punitive measures, how would these resonate with the UK economy and the public? Presumably not positively.
 
As in all negotiations parties go in considering their own best interest and asking for everything they feel they can and should have. It would be great to have a written position on the asks and offers of the UK Government as well. It seems for the time being there are statements made behind closed doors (in Brussels) and statements made in public (in the UK) and these two are not quite aligned yet.
 
The transition period would last until Dec 31, 2020, that is 1 year and 9 months after Brexit. This suggest, that a future trade agreement between the parties would have to be drafted and approved during this time period.
 
The transition paper does not include the terms of the financial settlement and the issue of citizens rights, both of which will be part of the withdrawal bill. The withdrawal bill and the transition agreement will be presented jointly to Member State parliaments by the end of 2018 (hopefully)."

 

 

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