On Wednesday 7 March, the president of the European Council, Donald Tusk, presented a first draft of guidelines on the approach to be taken by the EU27 in upcoming trade negotiations with the United Kingdom, as well as on future links uniting the two parties in areas such as security and defence.
The “draft guidelines”, which circulated in the press which were to be discussed during the day by the permanent representatives of the EU27, do not enter into detail due, in particular, to the vagueness still surrounding British demands. They do, however, underline the fact that both parties will indeed be negotiating a free trade agreement.
To begin with, the EU recalls its red lines: as the United Kingdom does not wish to remain in the single market or the customs union, it will be necessary to find the best possible balance between rights and obligations. London cannot hope to continue to enjoy the same advantages. To be outside the single market and the customs union while adding regulatory differences will necessarily lead to friction and customs inspections.
Nonetheless, the EU is willing to find the most ambitious solution possible within this free trade agreement and aims for there to be an absence of customs tariffs for goods and all sectors and an absence of quantitative restrictions. The fisheries sector must follow this logic and be based on mutual opening of waters to those in the industry.
On the subject of customs, the EU does not take up the idea of a customs partnership as Theresa May had suggested on 2 March. The idea is, moreover, part of the concepts still considered “nebulous” by the EU, one European source says. On the other hand, it opens the door to appropriate customs cooperation which safeguards the autonomy of decision and regulatory autonomy of both parties, as well as the integrity of the customs union.
The die has not yet been cast for financial services
The heart of this agreement would still include services, with ambitious provisions on the movement of persons as well as a framework for recognition of professional qualifications. The project does not, however, specify whether the financial services will be included in this agreement – but it does not rule it out either. Whether the EU will proceed with equivalence or another instrument for this kind of financial services still depends on the level of precision that only negotiation will bring. London would, at any rate, like services to appear in the agreement, said Chancellor of the Exchequer Philip Hammond, speaking on Wednesday.
Services would be rendered according to the “rules of the host state” and treated while bearing in mind that “the United Kingdom will become a third country and that the Union and the United Kingdom will no longer share the same regulatory, surveillance or judicial framework”.
According to the project, other areas which also present an interest for the Union – for example, access to public procurement, investment and the protection of intellectual property rights, including geographical indications – could be included in the agreement.
The EU is also willing to accept the fact that the United Kingdom might take part in programmes linked to research, innovation and culture, with the rules that arise from this. On the other hand, the text seems less clear about the fact that the United Kingdom could remain a country associated to the European agencies for medicines, aviation or chemical products, without however ruling out this possibility.
Rapid agreement on aviation
As regards aviation and aviation safety, the EU points out that it is urgent to find a solution in order not to cause air traffic disruption and states it is willing to work as swiftly as possible on a cooperation agreement to remedy this.
The guidelines also underline the EU’s readiness and resolve to keep London as a security and defence partner that is as close and solid as possible. The future partnership should cover information exchange, support to operational cooperation between law enforcement services and the legal authorities, and judicial cooperation in criminal matters.
In the fields of security, defence and foreign policy, there should be no break in cooperation between the two parties. A future partnership should respect the Union’s decision-making autonomy and foresee dialogue, consultation and information exchange.
On the subject of data protection, the EU stands ready to work on a decision of adequacy. This project, however, will have to evolve, mainly adjusting to the desires of member states as all do not, for example, have the same interest when it comes to financial services.
Parliament calls for deeper association agreement
The European Parliament's Brexit coordinator, Guy Verhofstadt, took a stance in favour of an association agreement with the United Kingdom. This would, however, be more detailed than the one with Ukraine due to the far closer links with London. The free trade agreement will also be far deeper with London because “the United Kingdom is not Mexico or Morocco”. (Original version in French by Solenn Paulic)