The UK’s attempt to leapfrog a divorce deal and move talks on to trade incensed EU negotiators during a third round of Brexit talks this week (see EUROPE 11852). But the two are inextricably and intricately linked.
Commission president Jean-Claude Juncker admitted as much during an address to the EU’s own ambassadors and special envoys this week, referring to “partial overlaps”.
Taken hostage?
Take Ireland as an example, which is one of the EU’s top three priorities for the first phase of talks, along with money and citizens’ rights. One of the issues that the EU wants to pin down in the first phase of talks is how to preserve the Good Friday Agreement post-Brexit.
The 1998 peace deal sets up cooperation – and some joint institutions – between Dublin and Belfast in areas such as farming, healthcare, energy and water (there are 12 in all). But if Northern Ireland is out of both the single market and customs union, the standards and regulations underpinning that cooperation (sanitary rules or flood management plans, for instance) could potentially diverge.
Some – like the republican Sinn Féin party – say the only solution is a “special status” for Northern Ireland that would allow it to remain in the customs union and single market post-Brexit. Others, like the Irish government, would prefer it if the UK as a whole remained in at least the customs union, though that has been ruled out by London. Negotiators will have to seek a third way that satisfies both the EU’s single market rules and the UK’s system of devolved governments (which, incidentally, is being tightened up under the government’s recent EU repeal bill).
And it gets even more complicated. There are genuine and growing concerns that the UK is “taking this issue hostage” – in the words of one senior EU official – to cut a deal on trade, with one informed source insisting the Irish border should not be a “test bed or petri dish for eventual overall discussions of UK-EU borders”. The UK’s position paper on Ireland and “future partnership” paper on customs, published alongside each other in August, rang alarm bells in Brussels for this very reason.
“We have to design a stand-alone solution that works for Ireland,” said a senior EU official involved in the talks, echoing language in EU leaders’ negotiating guidelines, which refer to Ireland’s “unique” situation.
The EU will publish a position paper on Ireland next week, but it will not offer solutions on north-south cooperation, leaving it up to the UK to report back in September with further ideas.
‘Genuine progress’
But there has been one breakthrough on Ireland this week, with EU lead negotiator Michel Barnier citing “genuine progress” on the common travel area, a zone that allows citizens from the UK or Ireland (as well as the Channel Islands and Isle of Man) to travel, work and access health and social benefits in either country as if they were nationals. It began life as an informal agreement in the 1920s, following Irish independence, and though it’s still not a legal agreement in and of itself, it is recognised in the EU treaties (Protocol 20) and lives on in Irish and British immigration laws.
Both sides have now agreed that the UK’s post-Brexit immigration crackdown will not force Ireland to erect border checks for non-Irish EU citizens moving around the common travel area, with the UK now working on language to be inserted into the final deal.
‘Impossible'
Yet the breakthrough did nothing to repair relations between EU and UK negotiators, with talks running aground this week over the UK's refusal to show its hand on the financial settlement, preferring a strategy of “constructive ambiguity” on the issue. Add that to its red line on the European court of justice and its repeated attempts to talk trade, and things look bad for a hoped-for October deadline sign off on the divorce deal. Privately, many close to the talks are mentioning December as a more likely date.
David Davis, writing for international news network CNN on Friday ahead of a trip to the US, said he was “hopeful we can start talking soon about a trade deal with the EU in the near future”, while UK trade secretary Liam Fox said the EU was trying to “blackmail” the UK over the divorce bill.
Mr Barnier said the UK was making “impossible” demands, seeking to keep the benefits of the single market while remaining outside it. He even accused the UK of a “sort of nostalgia” over the move, and insisted he would stick “scrupulously” to the two-phase approach and political guidelines handed to him in April by the European Council (see EUROPE 11778).
EU leaders have deliberately left themselves enough leeway to be able to make a call on sufficient progress, by not revealing exactly what their landing zone will be on any of the three priority issues. The UK says the whole process places a stranglehold on the EU negotiating team, accusing them of inflexibility and having to go back to their political masters before signing off on anything.
So here we are, at the end of the third round. Both sides have their bargaining chips in hand –the UK with the financial settlement, the EU with its phased approach. Neither side appears ready to show their cards. (Sarah Collins)