During a visit to Dublin on Thursday 8 March, the President of the European Council, Donald Tusk, warned the United Kingdom that the lack of progress on resolving the Irish question could lead the negotiations as a whole into an impasse.
The President of the Council expressed these views when he was with the Irish Prime Minister, Leo Varadkar. He also returned to the subject of the draft guidelines published on 7 March on future relations and indicated to the Chancellor of the Exchequer, Philip Hammond, that even if financial services were included in the future free-trade agreement (FTA), they would not be able to benefit from the same advantages as they do today. He said that “Life will be different after Brexit”.
If the EU does offer an FTA with zero customs duties and no quotas on goods, Donald Tusk warned that, “We cannot offer the same thing on services” because services are not based on “customs tariffs” but respect for a “level playing field”. This is why the FTA presented on Wednesday does not include any “detailed rules on financial services".
The President of the Council was responding to the speech made on Wednesday 7 March in London by Philip Hammond who highlighted the fact that financial services should be included in this FTA and that this would also be in the interest of the European Union. On this point, Donald Tusk, explained on Thursday that it was up to the EU, first of all, to define its own interests.
On the Irish question, Leo Varadkar, emphasised that without a viable solution being put forward by the British, it would be necessary to apply the “backstop” solution presented by the Commission on 28 February, which consists of maintaining Northern Ireland in the regulatory zone of the customs union and single market in order to protect North-South cooperation and avoid a hard border.
The Irish Prime Minister also welcomed the EU's intention to maintain the closest possible relationship with London, whilst ensuring the same rules are applicable and the integrity of the single market. Leo Varadkar also welcomed the evolution clause included in the draft guidelines that will enable the EU 27 to modify its position by October if London changes its mind on the single market and customs union.
On Wednesday 7 March, Parliament approved a draft resolution on this future framework, which will be debated at next week's plenary in Strasbourg. The resolution is proposing “an association agreement between the EU and the United Kingdom” which, “could provide an appropriate framework” for the future relationship. This relationship could possibly be based on four pillars: economic and trade relations, foreign policy, internal security and thematic cooperation with, for example, cross-border projects in research and innovation. MEPs are insisting that this relationship includes a coherent framework for governments, including a robust disputes settlement mechanism.
The text explains that, “Any framework for future relations should respect the integrity of the internal market, banking union and the four freedoms, without allowing for a sectoral approach. It should also preserve the autonomy of decision-making and the EU’s legal order, including the role of the European Court of Justice”. (Original version in French by Solenn Paulic)