Sign post with UK and EU flags as signs pointing in different directions

What is the UK’s approach?

The UK and the EU set the framework for the future relationship negotiations in a non-binding joint political declaration agreed alongside the withdrawal agreement in October 2019. The declaration stated that it established “the parameters of an ambitious, broad, deep and flexible partnership across trade and economic cooperation with a comprehensive and balanced free trade agreement at its core, law enforcement and criminal justice, foreign policy, security and defence and wider areas of cooperation”.

Once the UK had left the EU in January 2020, both sides separately set out details of their own objectives for the negotiations. The Government set out the UK’s approach in a written statement from the Prime Minister on 3 February 2020 and a command paper, The Future Relationship with the EU: The UK’s Approach to Negotiations, published on 27 February 2020. The command paper explained that the UK was seeking a Canada-style free trade agreement, with other areas of cooperation covered in separate treaties:

As [the political declaration] makes clear, a Comprehensive Free Trade Agreement (CFTA) should be at its core. This Agreement should be on the lines of the FTAs already agreed by the EU in recent years with Canada and with other friendly countries […] The CFTA should be supplemented by a range of other international agreements covering, principally, fisheries, law enforcement and judicial cooperation in criminal matters, transport, and energy […] All these agreements should have their own appropriate and precedented governance arrangements, with no role for the Court of Justice.

In his written statement, Boris Johnson set out the UK’s red lines:

Any agreement must respect the sovereignty of both parties and the autonomy of our legal orders. It cannot therefore include any regulatory alignment, any jurisdiction for the CJEU [Court of Justice of the European Union] over the UK’s laws, or any supranational control in any area, including the UK’s borders and immigration policy.

He also said some areas of future cooperation would not need to be managed through an international treaty. The UK would develop its own separate and independent policies in areas such as immigration, competition and subsidy, the environment, social policy, procurement and data protection.

The EU set out its approach in its negotiating directives, adopted on 25 February 2020. The European Commission explained it intended to negotiate the future partnership as a package covering general arrangements (values, principles and governance), economic arrangements (trade, level playing field guarantees and fisheries) and security arrangements (law enforcement and judicial cooperation in criminal matters, foreign policy, security and defence).

Both sides have published draft legal texts that reflect their preferred approach to the future relationship. The EU published the draft text of a comprehensive partnership agreement in March 2020. In May 2020, the UK published a draft free trade agreement and a series of separate draft agreements covering fisheries, air transport, civil aviation safety, energy, social security coordination, civil nuclear, law enforcement and judicial cooperation in criminal matters, the transfer of unaccompanied asylum-seeking children, and the readmission of people residing without authorisation.

The two sides’ positions are summarised in a side-by-side table in the House of Commons Library briefing, The UK-EU Future Relationship Negotiations: Summary of Positions (3 June 2020).

Progress of negotiations so far

Eight negotiating rounds took place between 2 March 2020 and 10 September 2020. While both sides acknowledge progress has been made, significant areas of disagreement remain:

  • Level playing field and state aid: The EU is seeking level playing field commitments to ensure common standards in areas such as state aid, workers’ rights and the environment. It says these are necessary to prevent trade distortions and unfair competition, particularly given the proximity and interconnectedness of the UK and EU economies. The UK maintains it will not accept provisions that bind it to EU laws and standards. It says the proposals it has put forward are closely modelled on arrangements the EU has already agreed with similar countries such as Canada.
  • Fisheries: The EU wants to maintain its access to UK waters on the basis of historic fishing patterns. The UK emphasises its sovereign control over its own waters, and wants fishing quotas to be negotiated on an annual basis.
  • Governance: The UK has proposed separate governance arrangements for the various draft agreements it tabled. The EU is seeking an overarching governance structure for the future relationship with “horizontal dispute mechanisms” that would allow cooperation to be suspended in one sector in response to an unresolved dispute in another area.

These issues are explored in more depth in the following House of Commons Library briefings:

At the end of the eighth round of negotiations, the EU’s chief negotiator Michel Barnier accused the UK of “refusing to include indispensable guarantees of fair competition in our future agreement, while requesting access to our market”. He said the UK had “not engaged in a reciprocal way on fundamental EU principles and interests”.

Lord Frost, the UK’s chief negotiator, said the UK had “consistently made proposals which provide for open and fair competition, on the basis of high standards, in a way which is appropriate to a modern free trade agreement between sovereign and autonomous equals”.

Lord Frost and Mr Barnier are due to hold further meetings next week and a ninth round of formal negotiations is scheduled for 28 September to 2 October 2020. The EU’s position is that an agreement needs to be reached by the end of October 2020 to allow time for ratification before the end of the transition period on 31 December 2020. Boris Johnson has said that if agreement is not reached by the time of the European Council meeting on 15 to 16 October 2020, both sides should accept there will be no agreement and “move on”.

What if there is no agreement?

The Government stated in the command paper on its approach to negotiations that if it did not prove possible to negotiate a satisfactory outcome, the UK’s trading relationship with the EU would rest on the withdrawal agreement and would “look similar to Australia’s”. Australia has no free trade agreement with the EU, although negotiations for one have been ongoing since July 2018. An ‘Australia-style’ arrangement would mean the UK would trade with the EU on WTO terms.

Boris Johnson said in early September that a trading arrangement like Australia’s would be a “good outcome” for the UK, although the Government would continue to work hard throughout September to reach a deal with the EU.

In July 2020, the Government launched its ‘Check, Change, Go’ campaign to inform businesses and citizens about what they need to do to prepare for the end of the transition period in December 2020, regardless of the outcome of the negotiations. Because the UK will no longer be within the EU’s single market and customs union, some of these preparations will apply even if there is a deal between the UK and the EU.

Impact of the United Kingdom Internal Market Bill

The introduction of the United Kingdom Internal Market Bill in the House of Commons may affect the atmosphere of future negotiating rounds. The bill contains measures that would enable ministers to disapply or reinterpret aspects of the Northern Ireland Protocol that was agreed between the UK and the EU as part of the withdrawal agreement. The House of Commons Library briefing on the bill explains more about these provisions. The bill seeks to ensure that ministers could use these powers “notwithstanding any relevant or international or domestic law with which they may be incompatible or inconsistent”. The Northern Ireland Secretary acknowledged that “this does break international law in a very specific and limited way”.

Some aspects of how the protocol is to be implemented are still to be agreed by the Joint Committee established under the withdrawal agreement. Boris Johnson has argued that the controversial provisions in the bill are needed because negotiations in the Joint Committee “risk coming unstuck”. He said: “We are now hearing that unless we agree to the EU’s terms, the EU will use an extreme interpretation of the Northern Ireland Protocol to impose a full-scale trade border down the Irish Sea”. Mr Johnson told the Commons Liaison Committee he did not believe the EU was negotiating in good faith.

Maroš Šefčovič, the EU co-chair of the Joint Committee, said the Government had “seriously damaged” trust between the UK and the EU by putting forward the bill. Calling on the Government to withdraw the measures from the bill by the end of September at the latest, he said the EU would “not be shy in using” mechanisms and legal remedies in the withdrawal agreement to address any violations of its provisions. Ursula von der Leyen, President of the European Commission, also alluded to trust between the UK and the EU in her State of the Union address this week. She said it was “a matter of law, trust and good faith” that the withdrawal agreement could not be “unilaterally changed, disregarded, disapplied”. 

House of Lords debate

On 23 September 2020, there will be a debate in the House of Lords on a motion moved by Lord True, Minister of State at the Cabinet Office, that the grand committee takes note of the United Kingdom’s approach to negotiating the future relationship with the European Union.

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