On the 20th May 2020, in preparation for the next round of talks with the EU – due to commence in early June – the UK Government went public with their planned approach to the Northern Ireland Protocol.
First and foremost, this is an outline of how the UK Govt propose to implement and meet the legal obligations they committed to within the Withdrawal Agreement and Protocol. As such, it needs to be kept in mind that this document only covers the opening position of the UK side in these future trade discussions whilst the EU will have their own approach, based on the different aims and priorities of their key stakeholders, i.e. the 27 member states, including the Republic of Ireland, who have a clear strategic and personal interest.
That aside, Fortior Insight Ltd believe that the document, and the accompanying press release, should be viewed as a welcome clarification on the UK’s position.
Pragmatic v Legalistic
The UK call for all parties to take a pragmatic approach when it comes to Northern Ireland is a central focus point in this 20-page document. ‘Pragmatic’ is often defined as dealing with things ‘sensibly and realistically’, therefore, who could argue against such a request? In this case, however, some (especially on the EU side) will likely claim that the UK are calling on the EU to take a ‘minimalistic’ approach, i.e. meaning to do the ‘least possible’, more so than a pragmatic one.
Calling for pragmatism is not a new tactic from rank and file conservatism. The PM made similar calls last October when the Govt also released for public scrutiny its counter proposal on the now defunct, original backstop-based Protocol. Earlier this year, in February, Stephen Booth, the Head of the Britain in the World Project at Policy Exchange, wrote an article in the conservativehome.com website centered on the UK’s pragmatic approach to the transition talks. Within this article, Mr. Booth appears to argue that the EU were, in contrast, taking a much more ‘legalistic’ approach, i.e. ‘concerning adherence to law and formula, to the negotiations:
“Ultimately, the debate is beset by the same conflicting interests witnessed in the previous talks. For the EU, having avoided the prospect of a North-South border for now, the primary concern is the integrity of its external border, which will be shifted to the Northern Ireland border. In the first instance, the EU’s approach to such questions is, as ever, a legalistic one and its base case is that all the usual checks should apply.”
Within the following document, Fortior Insight will review the latest paper released by the UK Government and where possible, compare and contrast its content directly with the Protocol it relates to.
The UK’s Approach to the Northern Ireland Protocol
The document begins with a preface/foreword in which the Rt Hon Michael Gove MP, Chancellor of the Duchy of Lancaster, sets out the background to and need for the Ireland/Northern Ireland Protocol.
Mr. Gove reiterates that the constitutional status of Northern Ireland remains within the United Kingdom and that this will only change if the will of the majority in Northern Ireland consent to such change – this is covered within Article 1 of the Protocol.
It is stressed that, as an integral part of the United Kingdom, Northern Ireland must have ‘unfettered access’ to the internal UK market – covered again in the Protocol preamble and in detail within Article 6 Protection of the UK internal market.
There is acknowledgement by Mr. Gove that there will be some “new administrative requirements” as a result of the Protocol, but he hopes that this proposal will set out how the UK Government believe they can protect the interests of both the ‘whole United Kingdom’ and the EU, whilst:
- delivering unfettered access for Northern Ireland businesses to the whole of the UK market.
- ensuring there are no tariffs on goods remaining within the UK customs territory.
- discharging the UK’s obligations without the need for new infrastructure in Northern Ireland, and,
- guaranteeing that Northern Ireland businesses benefit from the lower tariffs – as yet to be negotiated in most parts – through the UK’s new Free Trade Agreements with third countries.
Within the Introduction that follows the Foreword, the author acknowledges that, at the end of the transition period on the 31st of December 2020, trading arrangements with the EU, will either be on the basis of the Withdrawal Agreement only or also on a Free Trade Agreement.
We are told that this paper sets out the UK Governments approach to the implementation of the Northern Ireland Protocol in the Withdrawal Agreement, i.e. this is how the UK proposes to meet its obligations.
The UK Government believe that the position they set out, delivers on the objective to protect the Good Friday Agreement of 1998: It accepts that the Protocol was designed as a ‘practical solution’ to avoiding a hard border on the island of Ireland, and that as such, it contains a number of special provisions that apply only in Northern Ireland and for only as long as the protocol is in force, which will be decided by a democratic vote in the Northern Ireland Assembly every four years (eight years if the majority of both nationalists and unionists vote in favour), with the first vote being four years after the end of the current transition period – this is the democratic principle which is covered in Article 18 of the Protocol.
There is further acknowledgement that the Protocol places legal obligations on both the UK and EU, as well as other international law obligations – we assume referring to the UKs and the EU’s WTO obligations.
It also states that the UK Government and UK authorities are fully responsible to ‘give effect to the Protocol’. Note: this is factually correct; however, it should also be said that the Protocol declares in Article 12:
“Union (EU) representatives shall have the right to be present during any activities of the authorities of the United Kingdom, related to the implementation and application.”
The Approach Introduction refers to the restoration of the Northern Ireland Assembly in January 2020 and the commitments made by the UK Government within New Decade, New Approach to invite representatives of the Northern Ireland Executive to attend any Withdrawal Agreement Joint Committee or Specialised Committee meetings “where Northern Ireland is being discussed and when the Irish Government are in attendance” – as per Articles 14 & 15 of the Protocol.
New Decade, New Approach also committed the UK Government to legislate by 01/01/21 to “guarantee unfettered access for Northern Ireland businesses to the whole of the UK internal market”. Note: There is no definition provided in this paper on what ‘unfettered access’ actually means, however, the standard definition for unfettered is ‘not confined or restricted’.
The reader is informed that the structures provided for by the Withdrawal Agreement have been established and the first meeting of the Joint Committee was held remotely on the 30th March 2020 to launch the work of the Committee and the Specialised Committees, including the Ireland / Northern Ireland Committee.
The Ireland / Northern Ireland Specialised Committee held its inaugural meeting on the 30th of April. The Joint Consultative Working Group – which will act as an important forum for the exchange of information and mutual consultation – will be established, however, no date for this has been provided.
In addition, a business engagement forum which will meet regularly to allow NI businesses to put forward proposals and provide feedback on how to maximise the free flow of trade, will be formed and the Northern Ireland Executive will be invited to this forum.
Context: Northern Ireland Economy
Reference is made throughout this document to the Good Friday Agreement of 1998 with the UK Government reiterating the importance of sustained economic growth and stability in Northern Ireland, as a key part of the building of a shared and stable future.
As part of the UK’s recovery from Covid-19, the UK Government outlines in this document how it wants to promote new trade and economic investment and preserve trade and links between Ireland and Northern Ireland, however, at the same time, it also states that trade between NI and the rest of the UK constitutes 56% of NI’s total external trade in goods and involves 23,000 NI businesses, therefore, as its largest external market, the UK Government believes that:
“it is imperative that we take an appropriate and proportionate approach to such goods movements”
And then goes on to state that, in its view, this is:
“the only way in which to support Northern Ireland’s prosperity and the economic development that the 1998 Agreement recognised was essential to a broader transition to a peaceful and shared society.
UK Governments Proposed Approach to Protecting Northern Ireland’s Place in the UK Customs Territory
In discussions prior to the signing of the Withdrawal Agreement and Protocol, the UK negotiating party pushed for the principle of consent to be introduced. This was a central part of the compromise proposal published by the UK Government at the beginning of October 2019.
Article 18 of the Protocol covers Democratic Consent in Northern Ireland, however, the first vote will not take place until four years after the end of the transition period, rather than at the end of the transition period, as was proposed by the UK.
With no vote now due to take place until four years after the end of the transition period, the UK Government are declaring within this document that their priority is to ensure in this initial four year period, that the Protocol is delivered in a way that they feel will best protect Northern Ireland’s place in the UK customs territory.
The author refers to Article Four of the Protocol, declaring that this ‘clearly concedes’ that Northern Ireland is fully part of the UK’s customs territory: They then proceed to say that a customs territory generally involves the removal of all internal tariffs and has a common approach to external trade partners. As such, the UK Government believe that this ‘fundamental reality’ must be central to the way the Protocol is implemented.
Article 4: Customs Territory of the United Kingdom
Article 4 of the Protocol does indeed recognise that, by law (de jure), Northern Ireland remains part of the UK Customs territory, and therefore nothing in the Protocol shall prevent Northern Ireland from being included in the territorial scope of any agreements the UK may conclude with ‘third countries’ post-Brexit. However, it then states:
“PROVIDED that such agreements, don’t prejudice the application of this protocol.”
This means that, in practice (de facto), i.e. in administrative terms, Northern Ireland will remain subject to EU Customs & Tariffs rules and therefore there will be tariffs payable, via the UK Government authorities on behalf of the EU, on certain goods deemed as at risk of entering the EU’s Single Market.
In paragraph 16 of the paper, the UK Government do appear to be accepting that they need to put in place a system that enables them to collect tariffs on goods at risk of entering the EU Single Market “at ports of entry, rather than at the land border that is the legal boundary between the UK and EU customs territories”.
However, the UK stress that, beyond treating the island of Ireland as a Single Epidemiological Unit for food and health purposes and providing for wider regulatory alignment on industrial goods (manufactured goods), the Protocol does not create:
“any kind of international border in the Irish sea between Great Britain and Northern Ireland”.
The paper then sets out four key commitments that will underpin the UK Government’s approach to implementing the Protocol:
- Trade going from Northern Ireland to the rest of the UK should take place as it does now, with no additional process or paperwork nor should there be any restrictions on Northern Ireland goods arriving in the rest of the UK.
- Trade going from the rest of the UK to Northern Ireland will not have any tariffs levied for those goods remaining within the UK customs territory.
- Although there will be some limited additional process on goods arriving in Northern Ireland, this will be conducted taking account of all flexibilities and discretion and there will be no new physical customs infrastructure, however, the UK may expand some existing entry points for agri-food goods to provide for proportionate additional controls.
- Trade to and from Northern Ireland with third countries where the UK has Free Trade Agreements with those countries, Northern Ireland businesses will benefit from preferential tariffs, just as the rest of the UK will.
UK’s Proposal to Deliver on this Four Point Plan
The UK Government feel they can deliver on this four point plan as they believe that the Protocol is clear, i.e. that nothing in it prevents Northern Ireland businesses enjoying unfettered access to the rest of the UK internal market – Note, we agree that this is the case, as long as whilst not prejudicing the application of the protocol, i.e. the UK Govt (and the EU) need to find a way of doing this within the confines of their international obligations.
Unfettered access for Northern Ireland businesses
In relation to providing Northern Ireland companies with unfettered access to the rest of the UK, the paper states:
- No import customs declarations will be required as goods enter the rest of the UK from Northern Ireland – Our understanding from studying the Protocol is that this would not fall under its scope so no import declaration from GB companies would be required unless the UK Government asked for it.
- No entry summary (“safety and security”) declaration will be required as goods enter the rest of the UK from Northern Ireland – Again, GB imports are not under the scope of the Protocol so these would not have been asked for.
- No tariffs applied to Northern Ireland goods entering the rest of the UK in any circumstances– Goods traded within the internal UK market for use in the UK internal market are tariff-free. Tariffs are only ever applicable when the goods are at risk of entering the EU Single Market when travelling from GB to NI.
- No customs checks will take place as goods enter the rest of the UK from Northern Ireland – As per above, there is neither a requirement nor any authority within the scope of the Protocol for movement of goods from NI to GB (outside of the potential requirement for Exit Summary Declarations on the movement from NI – see later).
- No new regulatory checks as goods enter the rest of the UK from Northern Ireland – This would appear to indicate that the UK Govt will recognise EU regulatory standards on goods, as being – at very least – at the same level as future UK standards.
- No additional approvals required for placing goods on the market in the rest of the UK from Northern Ireland – see above.
- No requirement to submit export or exit summary declarations for goods leaving Northern Ireland for the rest of the UK – see below.
All of the above has been repeatedly confirmed in statements by the UK Government, with the British PM declaring last Christmas that “This is a matter for the UK government and we will make sure that businesses face no extra costs and no checks for stuff being exported from NI to GB.”
And for the most part, in our opinion, the UK PM is correct in his view that this is a matter for the UK Government; however, with regards to Exit Summary Declarations, Article 5(4) confirms that the Union Customs Code (UCC) will apply to Northern Ireland.
“The provisions of Union law listed in Annex 2 to this protocol shall also apply, under the conditions set out in that Annex, to and in the United Kingdom in respect of Northern Ireland”.
And as Article 271 of the UCC requires that exit summary declarations are lodged when goods are taken out of the customs territory of the Union, since Great Britain will no longer be part of the customs territory of the EU – de facto, de jure or otherwise – we assume that this will mean Exit Summary requirements will apply when a good is sent from NI to GB.
On this point of Exit Summary Declarations, the UK Govt do appear to accept in paragraph 20, that this is an area that they will need to persuade the Joint Committee to take a ‘pragmatic approach’ to during future talks.
Within paragraph 24, there is reference made to a provision within the EU (Withdrawal Agreement) Act 2020 for the Government to define a qualifying status for goods and businesses in Northern Ireland, benefitting from unfettered access. Note: Whilst we cannot find any direct reference to ‘qualifying status’ in the Withdrawal Agreement, it is assumed that this refers to Rules of Origin (and potentially Rules of Destination) provisions for Northern Ireland manufactured goods.
No Tariffs on Internal UK Trade
This paper states that there should be no tariffs on internal UK trade and that they should only be charged if goods are destined for Ireland or the EU single market, or if there is “genuine & substantial risk of them ending up there”
It then proceeds to provide some examples on what the UK Govt. considers as internal UK trade.
- Goods sent from GB suppliers for sale in NI.
- Raw produce from GB for agri-food processing in NI which is then sent back to GB (inward/outward processing).
- A supermarket delivering to its stores in Northern Ireland.
The focus here is all around risk, which is covered in Article 5 of the Protocol.
Article 5: Customs, movement of goods
Article 5 of the Ireland / Northern Ireland Protocol states:
“No customs duties shall be payable for a good brought into Northern Ireland from another part of the United Kingdom by direct transport, notwithstanding paragraph 3, unless that good is at risk of subsequently being moved into the Union, whether by itself or forming part of another good following processing.”
This basically means that the EU’s Union Customs Code will apply to all goods entering Northern Ireland BUT a distinction is being drawn between those goods entering Northern Ireland which are at risk of entering the EU Single Market and those which are not. Where there is such a risk, EU customs duties will apply.
Under Article 5(2), goods will be assumed to be at such risk unless they pass both parts of a two-part test:
- they are not subject to commercial processing in Northern Ireland, and,
- they meet criteria established by the Joint Committee: The Joint Committee will decide on criteria for these risk assessments by the end of the transition period.
Article 5 also defines processing of goods as meaning:
“Any alteration of goods, any transformation of goods in any way, or any subjecting of goods to operations other than for preserving them or affixing labelling marks, labels, seals or any other documents to ensure compliance.”
Article 5(6) of the Protocol, however, provides for a system of rebates for goods which can be shown not to have entered the EU. The UK may also compensate or waive other costs for traders which they would face because of having to apply the Union Customs Code.
Such UK Government schemes of tariff duty reimbursements and compensations for other customs-related costs would be subject to EU state-aid rules, as set out in Article 10:
“Subject to Article 10, the United Kingdom may in particular:
(a) reimburse duties levied pursuant to the provisions of Union law made applicable by
paragraph 3 in respect of goods brought into Northern Ireland;
(b) provide for circumstances in which a customs debt which has arisen is to be waived in respect of goods brought into Northern Ireland;
(c) provide for circumstances in which customs duties are to be reimbursed in respect of goods that can be shown not to have entered the Union; and
(d) compensate undertakings to offset the impact of the application of paragraph 3.
In taking decisions under Article 10, the European Commission shall take the circumstances in Northern Ireland into account as appropriate.”
Paragraph 27 of the paper refers to the above powers for the UK authorities to waive and/or reimburse tariffs on goods moving from Great Britain to Northern Ireland.
No New Customs Infrastructure in Northern Ireland
The paper acknowledges that the Protocol means that the UK authorities will apply EU customs rules to goods entering Northern Ireland and that this will entail some new administrative processes for traders:
“Notably new electronic import declaration requirements, and safety and security information, for goods entering Northern Ireland from the rest of the UK.”
There is a recognition here that these are needed to ensure that tariffs are not paid on trade within the UK, however, goods that are ultimately destined for the Republic of Ireland, should pay tariffs.
The paper states:
“We will ensure that these electronic processes are streamlined and simplified to the maximum extent, and we will set out more detailed plans for extensive HMRC support for businesses engaged in them. We will also review these new procedures on an annual basis, and if they should turn out to impose a disproportionate burden on goods moving wholly within the UK, we will consider how this burden can be reduced further or removed.”
Transitional Simplified Procedures
Transitional simplified procedures were simple measures HMRC had? planned to put in place to make importing as easy as possible for businesses.
In a No Deal Brexit, businesses that had registered for transitional simplified procedures, would have been able to transport their goods without having to make a full customs declaration in advance. They would also have been able to postpone paying duties and VAT.
Customs freight simplified procedures is a way to access simplified processes, but HMRC must authorise a business to use these. Any company using these procedures would also need a duty deferment account.
A duty deferment account allows a business to pay their customs duties, import VAT and excise duties monthly by direct debit, rather than having to pay immediately each time they clear their goods through customs.
If TSP (and CFSP) becomes an option once again, post-Brexit for Northern Ireland businesses –the statement above would appear to indicate that this may well be the case – companies would also have to have a duty deferment account to import goods using either of these procedures, if they have customs duties, excise duties or import VAT to pay.
Article 16: Safeguards
Article 16 of the Protocol provides the UK Government with unilateral ability to take any necessary safeguard measures to mitigate against any serious economic, social, or environmental difficulties they believe have been caused by the Protocol.
Once again in Paragraph 30, the paper refers to the UK authorities administering these customs rules and that they retain operational responsibility. Article 12 of the Protocol deals with this area.
Article 12 : Implementation, Application, Supervision and Enforcement
“The authorities of the United Kingdom shall be responsible for implementing and applying the provisions of Union Law……… made applicable by the Protocol……. In respect of Northern Ireland.”
“Union (EU) representatives shall have the right to be present during any activities of the authorities of the United Kingdom, related to the implementation and application.”
In practice, this could mean, European Customs officials taking part in checks at United Kingdom (Northern Ireland) ports with UK Customs Officials.
Within paragraph 31, the paper states that:
“There will, of course, be no export declaration, exit declaration, or customs and regulatory clearance for any goods as they leave the rest of the UK for Northern Ireland.”
At face-value, this could potentially be considered as one of, if not the most concerning statements in the entire paper, for Northern Ireland businesses however, if you take this in the context of the UK’s own customs system only, they are effectively saying that the UK is putting no internal customs requirements on GB businesses supplying goods to NI companies.
As we know from the Protocol that goods crossing the Great Britain – Northern Ireland border will need – on the Northern Ireland end – declarations on animal health (where applicable), VAT, tariffs, standards, rules of origin and, perhaps, rules of destination -therefore we can assume that If GB suppliers aren’t prepared or they are under the impression that they have no need to have goods prepared for such checks, this could result in major disruptions at NI ports and serious damage to NI businesses, as Northern Irish businesses, as the ‘importers’, are likely to face all of the new administrative burden and associated costs.
Within Paragraph 32, the UK Government state that they see no need to construct any new bespoke customs infrastructure in Northern Ireland in order to meet their obligations under the Protocol. Emphasis here is on the ‘new’ as they do go on to say that they may expand existing infrastructure.
The UK Government accept that, as per its existing status, the island of Ireland is considered a Single Epidemiological Unit (SEU) and therefore Northern Ireland will align with the EU [Sanitary and Phytosanitary] rules, including those relating to the placing on the market of agri-food goods.
As a result, agri-food goods entering Northern Ireland from Great Britain will do so via a Border Inspection Point of Entry, as required by EU law, with the UK building the provision that already exists to support the SEU. Agri-food goods would be subject to identity and documentary checks and physical examination by UK authorities as required by the relevant EU rules.
“We have accordingly confirmed that we will maintain existing facilities and designations for the purpose of processing arrivals of agri-food goods at Belfast Port, Belfast International Airport, Belfast City Airport and Warrenpoint Port. Expanded infrastructure will be needed at some of these sites for the purpose of agri-food checks and assurance. Working with the Northern Ireland Executive, at a minimum we expect to request additional categories of commodities at Belfast Port, and to designate Larne Port for live animal imports……. There will be no construction at points of entry where no plant or animal health checks are currently carried out.”
This would all appear to suggest that these things are all happening already, however, the reality is the Northern Ireland hasn’t required such inspection posts in the past as it didn’t deal with any significant levels of ‘non-EU’ arrivals.
To meet its obligations, the UK will have to expand existing infrastructure, determine what regulatory checks can be carried out at each entry point, and how many DAERA recruited veterinary staff will be required to be based there: And once that has been done, get these facilities inspected and approved by the European Commission.
Northern Ireland benefits from UK Trade Deals
Key here is “where goods remain in the UK’s custom territory.”
Under the revised Protocol, Northern Ireland will remain in the UK customs territory but will also be subject to EU customs rules for goods.
“As Northern Ireland remains in the UK customs territory, UK tariffs (rather than EU tariffs) will apply to imports of goods into Northern Ireland other than from the UK or the EU, i.e. if the UK negotiates any future trade deals, consumers and businesses in Northern Ireland can potentially benefit from these in the same way as businesses in the rest of the UK, PROVIDED that such agreements don’t prejudice the application of the protocol.”
If imports from Third Country suppliers are found to be at risk of entering the EU single market, EU Third Country tariffs will apply.
Regulation of Goods
Northern Ireland will align with all relevant EU rules relating to the placing on the market of manufactured goods.
The UK Government believe that those regulatory checks required for industrial goods could take place through market surveillance authorities at business premises or on the market, and therefore do not have to take place at ports.
It goes on to confirm that:
“Where Northern Ireland traders gain product approvals and certification for the Northern Ireland market from EU authorities and bodies, the UK will recognise these for the purpose of placing goods on the Great Britain market.”
Article 6: Protection of the UK Internal Market
Goods placed on the market in Northern Ireland shall be governed by the law of the UK.
Assessments, registrations, certificates, approvals and authorisations issued or carried out, based on provisions of Union Law, by competent authorities of the UK or by bodies established in the UK, will be recognised by EU member states.
Northern Ireland registrations, certifications, approvals and authorisations of sites, installations or premises in Northern Ireland will be recognised by the European Union.
Veterinary certificates and official labels for plant reproductive materials from Northern Ireland will be recognised by the European Union.
Qualified persons in Northern Ireland will be able to test and release batches of a medicinal product imported into or manufactured in Northern Ireland.
Any conformity marking, logo or similar required by the provisions of Union Law, will be valid in Northern Ireland and shall be accompanied by the indication UK (NI)
This section refers to those state aid rules that will apply in certain cases, where this is relevant to trade between Northern Ireland and the EU, as covered under Article 10 of the Protocol:
Article 10: State Aid
State Aid provisions of Union law shall apply in regard to measures supporting the production of, and trade in agricultural products in Northern Ireland – in respect of measures that affect that trade between Northern Ireland and the EU.
UK authorities can also support the production of, and trade in agricultural products in Northern Ireland – up to a determined maximum overall annual level of support.
VAT and excise
The paper confirms that, as per the Protocol (Article 8), Northern Ireland will maintain alignment on some administrative processes included within the EU VAT and excise rules for goods, however, it will remain, part of the UK’s VAT and excise system, with HMRC continuing to be responsible for the operation and collection of the revenues, which will not be passed on to the EU.
With regards to VAT rates, we are told that Northern Ireland remains bound by EU rules, but this ‘already provides a good deal of flexibility’: In order to illustrate this, it offers the example of the commitment made by the UK Government in the recent budget to scrap the 5% rate on sanitary products from 1st of January 2020, indicating that Northern Ireland will also benefit from this. Note: Sanitary products are also zero rated in the Republic of Ireland.
Article 8: VAT & Excise
Article 8 of the Protocol stipulates that the EU’s VAT rules for goods “shall apply to and in the United Kingdom, in respect of Northern Ireland.”.
The UK authorities will be “responsible for the application and the implementation” of these rules, “including the collection of VAT and excise duties” while “revenues resulting from transactions taxable in Northern Ireland shall not be remitted to the Union.”
The UK “may apply to supplies of goods taxable in Northern Ireland, VAT exemptions and reduced rates that are applicable in Ireland”, to prevent their being an unfair advantage on either side of the border.
What could this potentially mean in practice?
EU law on Value Added Tax will continue to apply in Northern Ireland as far as goods are concerned, but not services.
This could result in a scenario whereby Northern Ireland could have different VAT rates than the rest of the UK. A potential example of this was outlined by The Association of Accounting Technicians (AAT) in an article on the 21st of October 2019 as below:
“For example, if the UK decided to reduce the general rate of VAT on welfare items, such as smoking cessation products or air source heating pumps to, say, 2.5%, Northern Ireland would still have to keep it at 5%. As the latter percentage is the EU minimum.”
Rights of Individuals
The United Kingdom will continue to facilitate the related work of the cross-border institutions and bodies set-up as pursuant to the 1998 GFA.
Single Electricity Market
The provisions in the Protocol provide the legal basis for the Single Electricity Market to continue to operate following the transition period and will be implemented by the Northern Ireland Executive.
East-West and North-South co-operation
Reference is made to the UK Govts continued commitment to protecting the 1998 GFA during the implementation of the Protocol by strengthening co-operation and bilateral work. The Common Travel Area is cited as an example of ‘excellent and long-standing’ East-West co-operation. The CTA is covered under Article 3 of the Protocol and Article 11 deals with other areas of North-South co-operation.
Article 3: Common Travel Area
Article 3 sets out the protection of the Common Travel Area arrangements between the United Kingdom and Ireland and the associated rights and privileges enjoyed by British and Irish Citizens when in the other’s state.
Under the Common Travel Area, Irish and British citizens move freely and reside in either jurisdiction: Irish and British citizens enjoy associated rights and privileges, including the right to live and work, as well as to access healthcare, education, social benefits, and the right to vote in certain elections.
On 8 May 2019, the Irish and British Governments entered into a Memorandum of Understanding (MOU) reaffirming the joint commitment of both Governments to the Common Travel Area in all Brexit scenarios, and to maintaining the associated rights and privileges of Irish and British citizens under this long-standing reciprocal arrangement.
Article 11: Other Areas of North South Co-Operation
Continued commitment to (and an opportunity to build on), North–South co-operation, including in the areas of environment, health, agriculture, transport, education, tourism, energy, telecommunications, broadcasting, inland fisheries, justice & security, higher education and sport.
There are at least 142 areas of informal cooperation (in education, health, transport, security, and environmental protection, for example) across the Irish border, much of which has been facilitated by the common legal and policy framework of the EU.
The UK Govt. commit in this paper to continue to ‘support and contribute financially’ to a new PEACE + programme, run by the Special EU Programmes Body as a North-South implementation body established under the 1998 Agreement.
Further negotiating tasks for the Withdrawal Agreement Joint Committee
Within paragraphs 50 through to 55 of this paper, the UK government indicate that the Joint Committee will be tasked with further negotiations on three additional areas: agricultural subsidies – covered in Annex 2 & 6, fisheries – Annex 2, and supervision – Article 12 of the Protocol.
Supervision would appear to be the most controversial of these three areas (in terms of Northern Ireland at least) and is the one that has been in the press recently due to the differing views of the EU and UK on what kind of presence is required in Northern Ireland by EU officials in order to meet the requirements of Article 12.
Once again within this paper, the UK Government state that they will not agree to any permanent EU presence in Northern Ireland, as they feel such a presence would:
“risk being perceived as a return to joint controls and would be divisive in political and community terms.”
Maximising Northern Ireland’s use of new regulatory freedoms
In the concluding two paragraphs of the paper, the UK government reminds the reader that the Protocol relates only to a small subset of EU rules ‘relating to goods (and electricity) and other areas of existing co-operation’.
Northern Ireland will therefore still be bound, along with the whole of the UK, by sovereign UK rules including:
- New immigration system.
- Service industry rules.
- Control of UK territorial waters.
- Leaving the Common Agricultural Policy.
- No alignment with EU rules on social, broader environmental, consumer or competition laws.
The UK Government acknowledge within this paper that, at the end of the transition period on the 31st of December 2020, trading arrangements with the EU will either be on the basis of the Withdrawal Agreement and Protocols only, or on the basis of the WA and also on the terms of a Free Trade Agreement.
This paper outlines how the UK proposes to meet its obligations within the Northern Ireland Protocol. Central to their approach will be providing unfettered access for Northern Ireland businesses to the internal UK market, which according to a NISRA survey quoted, constitutes 56% of NI’s total external trade and involves 23,000 NI businesses.
The UK Govt go to great pains in this document to stress that there is no international border in the Irish sea between Great Britain and Northern Ireland because of the Withdrawal Agreement and Protocol.
There are four key commitments within this paper:
- No additional process, paperwork or restrictions placed on Northern Ireland goods arriving in the rest of the UK.
- No tariffs applied to goods going from GB to NI which will remain within the UK customs territory.
- No new infrastructure required to carry out the additional processes on goods arriving into Northern Ireland from Great Britain.
- Northern Ireland businesses can benefit from any trade deals the UK strikes with third countries.
The UK Government believe they will meet its Protocol obligations on goods entering Northern Ireland from the rest of the United Kingdom using new electronic import declaration requirements and safety and security information. They will streamline and simplify these requirements to the maximum via extensive HMRC supports.
In the case of regulatory checks on manufactured goods; they believe that these could take place through market surveillance authorities at business premises or on the market, rather than at ports. To support this view, they note that the UK currently checks only 4% of third country movements notified through customs declarations, with 1% involving physical fiscal checks on the consignments. They feel UK goods will not present similar levels of risk to third country movements.
In the case of agri-food goods, the UK Government accept that these goods will align with the EU sanitary and phyto-sanitary rules and will be subject to identity, documentary checks and physical examination. The island of Ireland will continue to be treated as a Single Epidemiological Unit (SEU).
Agri-food-goods entering Northern Ireland from Great Britain will do so via Border Inspection Points that will be located at existing sea and airports. This will require expanded infrastructure at some sites and additional commodity categorisations.
The above commitments would appear to be a much bigger undertaking than the UK Government is making out. Each facility will need to be inspected and improved by the European commission and they will need to be staffed with a significant number of DAERA recruited veterinary staff to carry out the necessary checks and certifications.
This paper is the clearest admission yet from the UK Government that Northern Ireland will be subject to different processes and checks than the rest of the UK due to the Ireland / Northern Ireland Protocol. However, despite the obligations made, the Govt are committed to providing NI businesses with unfettered access to the markets in the rest of the UK and the EU. As was recognised in the accompanying Press Release, these are benefits unique to Northern Ireland businesses.
“We are committed to using the new business engagement forum to facilitate and consider all proposals for Northern Ireland to make maximum use of these new freedoms, alongside the guaranteed unfettered access it will have to the markets in the rest of the UK and EU.”