On Friday 20 July, the European Union negotiator for Brexit, Michel Barnier, said there was "still time" to reach an agreement on the UK's withdrawal from the EU, with the objective still being to reach this for October.
"We are not far", he said at the end of the General Affairs Council (Article 50 format), nevertheless aware that the border between Ireland and Northern Ireland remains the most "serious and difficult" point (see other article). "This will require a lot of time and effort this summer", he added.
On Thursday, the Commission asked all the actors concerned to prepare for all Brexit eventualities, and notably for a failure of the negotiations (see EUROPE 12066).
When he arrived in Brussels on Friday morning, Germany's Secretary of State for European Affairs Michael Roth was asked about the ongoing negotiations and admitted he was "a little nervous". "I am an optimist, but it is hard to be optimistic in these difficult times", he said.
Less pessimistic, Barnier even outlined some openings towards London. As regards the backstop intended to avoid the return of a physical border between Ireland and Northern Ireland (see EUROPE 11971), he stated that the EU required a legally sound and operational solution.
But this solution will "not necessarily be our 'backstop'", Barnier admitted, saying that the Commission was ready to discuss this with his British counterparts, "to re-work it and amend it".
Barnier also stated that British Prime Minister Theresa May had committed in March to setting up a backstop which could, if necessary, be replaced with a better solution later.
Austria's Minister for European Affairs Gernot Blümel also insisted on the fact there would not be an exit agreement without an operational backstop. And without an exit agreement, no post-Brexit transition period until the end of 2020.
EU27's response to British White Paper
This ministerial meeting was the opportunity for Barnier and the EU27 to respond to the White Paper published by Theresa May's government on 12 July (see EUROPE 12061).
Barnier first underlined the positive elements, especially the fact that London "brings guarantees on the protection of fundamental rights and recognises the European Court of Justice as the sole arbitrator of European law". This thus opens up "the possibility of enlarging our offer of cooperation on internal security in particular", he commented.
As regards the post-Brexit economic partnership, the British White Paper raises three series of questions: - the compatibility of the proposals it contains with the integrity of the single market, customs union and EU trade policy; - the indivisibility of the four fundamental freedoms of movement of goods, services, capital and persons; - the autonomy of EU decision-making.
Barnier rejected the proposal, for example, "of aligning with the standards of the EU for goods, but only for standards checked at the border". In such a situation, "the UK would not therefore align with our agri-food rules on GMOs or pesticides, for example, as the respect of these rules is not checked at the border", Barnier noted.
Are the White Paper's ways forward therefore viable? "This is the question for regulatory alignment on goods, but all the more so for the agreement on the facilitated customs arrangement", Barnier stated.
This proposal would consist of applying two tariffs – that of the UK or that of the EU – to the goods that enter the UK, according to whether they are destined for the UK market or that of the EU.
"How could the customs staff check the final destination of goods and thus ensure that the right customs tariff is applied to them? Is there not a major risk of fraud in this?", Barnier asked. He wondered what the addition financial and administrative costs would be for the companies and customs staff forced to come into line with this new system.
One thing is clear for Barnier: "Brexit cannot, and will not, be a justification for creating additional bureaucracy".
Another question is whether the British White Paper proposals are in the economic interest of the EU. The free trade areas for goods that is proposed by London and modelled on European rules would not involve services, as London would like to diverge on these.
"When we know that 20 to 40% of the value of products we use every day is linked to services, how could we avoid the unfair competition that could be exercised on European companies?", Barnier asked, promising to continue the negotiations "until we have answers". (Original version in French by Solenn Paulic)