Brexit negotiations have hit a brickwall

The Brexit talks are deadlocked. Is there a way out? Eoin O’Shea takes a look.

Last week, at the end of the fifth round of Brexit negotiations, EU chief negotiator Michel Barnier confirmed that the talks between the EU and the UK are ‘deadlocked’. The upshot of Mr Barnier’s finding is that talks surrounding the UK’s future trade relations with the EU, or even talks leading to a transitional arrangement between the parties, are on an indefinite hold as far as the EU is concerned.  Mr Barnier went so far as to say that any future relationship between the UK and the EU would have to be robust, ambitious and lasting and, in the current circumstances, could not flow from a situation where the UK was not proposing to honour financial commitments built up during its membership of the EU.

Mr Barnier reiterated (laying bare, perhaps, one of the reasons for the lack of progress thus far) that the EU would not be making concessions on any of the matters at issue between the parties: citizens’ rights, the Northern Ireland border and the UK’s financial obligations to the EU.

While UK negotiator David Davis said he witnessed more progress than Mr Barnier cared to mention, he did not disagree with the Frenchman’s view that concord had not been reached on any of the parties’ current negotiating objectives.  

A number of months ago, former UK/EU luminary Lord Kerr put it as being 45% likely that the UK would crash out of the EU without a trade deal being in place, leading to a customs tariffs between the UK and the EU. Given that five rounds of negotiations between the parties on relatively straightforward matters (compared to long term relationship issues) have ended in stalemate every time, it is perhaps the case that we are now, more likely than not, (taking Lord Kerr’s 45% and adding at least 5% to it) facing a Brexit that will be quite hard indeed.  

To bring matters forward, it seems clear that the UK will need to concede on issues close to the heart of Brexiteers, including agreeing to pay significant monies to the EU as part of a Brexit bill and agreeing to a permanent role for the EU courts over important UK issues, such as immigration.  While relations between the two sides have not deteriorated to the level of Donald Trump/Kim Jong Un (for no one is making threats on Twitter…yet), it is clear that, if progress is to be made at all towards a long-term trade arrangement, one of the sides could usefully accommodate a rocket in the right place.

Eoin O’Shea FCA is a barrister specialising in tax and commercial law.