The UK has not published its own negotiating mandate yet – it is due out on Thursday – but we already have a pretty clear idea of what it will say, partly because of what Boris Johnson said in his Brexit speech in Greenwich and partly because of what Johnson said the same day in a written ministerial statement.
The trade talks will be hugely complicated, but there are two issues where the gap between the two sides is widest – on the general issue of the need for a level playing field, and on the specific issue of fishing.
Level playing field
What the EU is now saying: The key passage is paragraph 94. Here it is in full.
Given the union and the United Kingdom’s geographic proximity and economic interdependence, the envisaged partnership must ensure open and fair competition, encompassing robust commitments to ensure a level playing field. These commitments should be commensurate with the scope and depth of the overall envisaged partnership and the economic connectedness of the parties. These commitments should prevent distortions of trade and unfair competitive advantages so as to ensure a sustainable and long-lasting relationship between the parties. To that end, the envisaged agreement should uphold common high standards, and corresponding high standards over time with union standards as a reference point, in the areas of state aid, competition, state-owned enterprises, social and employment standards, environmental standards, climate change, relevant tax matters and other regulatory measures and practices in these areas. In so doing, the agreement should rely on appropriate and relevant union and international standards. It should include for each of those areas adequate mechanisms to ensure effective implementation domestically, enforcement and dispute settlement, including appropriate remedies. The union should also have the possibility to apply autonomous, including interim, measures to react quickly to disruptions of the equal conditions of competition in relevant areas, with union standards as a reference point.
How the EU mandate has been toughened up: Paragraph 94 is tougher than the equivalent passage in the original draft, paragraph 89. The original said the agreement should uphold “common high standards” in various areas but now it says the agreement should uphold “common high standards, and corresponding high standards over time with union standards as a reference point” in these areas. This is not the same as “dynamic alignment” – the toughest form of level playing field provision, involving a rule saying regulations would have to remain aligned (so that if, for example, the EU toughened its laws, the UK would have to follow suit). But it is a nudge in this direction.
The original also said that if the UK broke these conditions, the EU should have the power to “apply autonomous interim measures” as a sanction. Now the text talks about the EU being able to “apply autonomous, including interim, measures” in response – implying that non-interim, ie permanent, sanctions could be imposed too.
How this differs from the UK’s demand: The UK is adamant that it will not agree to be bound by EU regulations. In his written statement Johnson said:
Any agreement must respect the sovereignty of both parties and the autonomy of our legal orders. It cannot therefore include any regulatory alignment …
In his speech he insisted there was no need to have a commitment of this kind, because the UK would maintain high standards anyway. He said:
There is no need for a free trade agreement to involve accepting EU rules on competition policy, subsidies, social protection, the environment, or anything similar any more than the EU should be obliged to accept UK rules.
The UK will maintain the highest standards in these areas – better, in many respects, than those of the EU – without the compulsion of a treaty.
And, just in case anyone failed to get the message, No 10 said yesterday:
The UK’s primary objective in the negotiations is to ensure that we restore our economic and political independence on 1 January 2021.
What remains to be seen is whether common ground can be found in the possible overlap between “high standards over time with union standards as a reference point” and Johnson’s determination to “maintain the highest standards”. But if the UK will not legally commit to upholding EU rules, then any agreement will involve the EU trusting the UK to honour its promises. And, as we saw this morning (see 9.50am and 10.11am), trust between the two sides is under strain.
What the EU is now saying: The section on fishing starts at paragraph 86. Here are the most important paragraphs:
Besides the cooperation on conservation, management and regulation, the objective of the provisions on fisheries should be to uphold union fishing activities. In particular, it should aim to avoid economic dislocation for union fishermen that have been engaged in fishing activities in the United Kingdom waters.
To reach this objective, the provisions on fisheries should uphold existing reciprocal access conditions, quota shares and the traditional activity of the union fleet, and therefore:
– uphold continued reciprocal access, for all relevant species, by union and United Kingdom vessels to the waters of the union and the United Kingdom;
– uphold stable quota shares, which can only be adjusted with the consent of both parties;
– include modalities for transfers and exchanges of quotas and for the setting of annual or multi-annual total allowable catches (or effort limitations) on the basis of long-term management strategies.
How the EU mandate has been toughened up: The original version of the mandate just said “the provisions on fisheries should build on existing reciprocal access conditions, quota shares and the traditional activity of the union fleet”. That has now become “uphold existing reciprocal access conditions” etc. EU fishing fleets do not want to lose any of the access they currently have to UK waters, or UK fish, and this new wording implies that the status quo should continue.
How this differs from the UK’s demand: This is what Johnson said about fishing in his Greenwich speech.
We are ready to consider an agreement on fisheries, but it must reflect the fact that the UK will be an independent coastal state at the end of this year 2020, controlling our own waters.
And under such an agreement, there would be annual negotiations with the EU, using the latest scientific data, ensuring that British fishing grounds are first and foremost for British boats.
British fishermen expect to be allowed to catch a larger proportion of the fish in British waters after Brexit and Johnson fuelled this expectation by saying that British fishing grounds should be “first and foremost for British boats”. The EU is resisting this, because it wants to ensure EU fishermen don’t lose out.
And the EU is pushing for a long-term agreement on access. But the UK wants annual negotiations, which presumably would give the UK the right every year to refuse EU boats access to British waters.