Brexit News, Member News

Vulcan Insight | COVID-19 breaches the Brexit Negotiation bubble at the last minute

With just under six weeks until the end of the transition period, the EU-UK negotiations on the future relationship hit a familiar roadblock, as the coronavirus breached the carefully sealed bubble of negotiators.  

Since the very public fallout between the parties in October, talks had, as promised by Commission President von der Leyen, been significantly intensified with in-person negotiations taking place almost daily since 22 October. In fact, considering that both chief negotiators had been very light-lipped recently, some commentators had even speculated that we had entered the much-coveted negotiating ‘tunnel’ signalling the final stages of the talks. Alas, no.

However, both EU chief negotiator Michel Barnier and his UK counterpart, David Frost, have managed to make some progress over the past few weeks, with the parties having overcome divisions in areas such as the participation of the UK in EU programmes, aviation safety and social security coordination, as well as some aspects of trade in goods, services and investments. According to Mr. Frost, the parties had in the past number of weeks progressed to working on a joint text of more than 600 pages. The final EU-UK Withdrawal Agreement, in comparison, amounted to 177 pages, highlighting its complexity over the “relatively easy” withdrawal negotiations.

Negotiators are yet to record any significant steps forward, essentially since the talks kicked off in late February, on the most contentious points of fisheries, governance and safeguards to ensure fair competition (level playing field provisions). On the latter two, negotiations this week revolved around so-called evolution clauses on non-regression, which would bind the UK Government to commit itself to evolve its social, economic and environmental standards in line with the EU.

Unsurprisingly, Mr. Frost strongly pushes back on any such demands, arguing that it would undermine the fundamental reason for Brexit and impede the “UK’s sovereign decision-making power.” He also rejects the notion that current standards should be considered as the baseline for assessment, meaning that any future UK regulatory divergence could be seen by the EU as undermining the Single Market causing retribution.

The slight hint of progress and hope for an agreement in the coming days, however, was shattered at 3.22pm Brussels time on Thursday when Michel Barnier tweeted that he would “suspend negotiations […] for a short period” over a positive test in the EU negotiating team. It is now thought that Mr. Barnier, who had been in contact with the team member, will be self-isolating for 10 days in accordance with Belgian regulations.

While this certainly isn’t the first time that the negotiations were directly hit by the global pandemic, both Mr. Barnier and Mr. Frost tested positive for the virus in March, the news could not have come at a more critical stage. With only 6 weeks until the UK is set to legally leave the EU’s Single Market and Customs Union, and only potentially a few days before a somewhat fluid EU-internal deadline to facilitate the remaining administrative and legal scrutiny, a couple of days of slowing-down or even pause negotiations could prove fatal.

In Brussels, mid-next week is widely considered as the very last chance to reach an agreement to give enough time for the necessary legal cleaning-up, translation into all 24 official languages and European Parliament scrutiny by at least three Committees.

In light of the very limited remaining time and progress so far, and tight window left for ratification at EU (and potentially national) level, French President Macron, as well as Prime Ministers De Croo and Rutte of Belgium and the Netherlands respectively, called on the European Commission to step up its contingency planning for a no-deal at their virtual European Council meeting on Thursday evening.

Compliments of Vulcan Consulting – a member of the EACCNY.