Brexit Bites, 2 July 2018

Jul 02, 2018

At a summit of EU leaders last week, there was little report of progress on finding a solution to avoid a hard border on the island of Ireland.  Media reports today suggest that the UK is planning to release proposals for a third customs option with the EU in addition to the “max-fac” and customs partnership options that are already on the table.

No-deal Brexit?

Little progress has been reported on finding a solution to the Irish border following last week’s two-day European Council summit in Brussels.  And emerging reports from the meeting is that it would be wise for governments and businesses to plan for the worst.

President of the European Council, Donald Tusk made the following remarks following the summit: “On Brexit. The EU27 has taken note of what has been achieved so far. However, there is a great deal of work ahead, and the most difficult tasks are still unresolved. If we want to reach a deal in October we need quick progress. This is the last call to lay the cards on the table.”

The customs conundrum

There are various reports in the media today suggesting that the UK is drawing up proposals for another possible model for customs arrangement after Brexit.  No details have been released about the plans but it is reported as being “distinct” from the customs partnership option and the maximum facilitation option.

The customs partnership models, reportedly favoured by the Prime Minister, would see the UK collect customs duties on behalf of the EU.   The maximum facilitation or “max fac” option seeks to use technology to keep the EU borders as frictionless as possible.  The EU has concerns about both options and would like to see concrete details on how a hard border can be avoided on the island of Ireland.

Discussions also took place in May on keeping the UK tied to the EU customs rules beyond the transitional date of 31 December 2020 and would mean that the whole of the UK would be aligned with EU rules.  This idea is an extension of the EU’s proposal of the backstop which would keep Northern Ireland aligned with the EU’s customs union and Single Market.  However the UK backstop proposal was criticised by the EU.

It’s reported that UK ministers will gather this week to discuss the customs proposals and come up with a plan for the future relationship between the UK and EU.