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UK accuses the EU of ‘putting the single market first’ over Northern Ireland

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Ahead of this week's UK meetings (9 June) on the EU-UK Partnership Council (to discuss the EU-UK Trade and Cooperation Agreement) and the Joint Committee to discuss the implementation of the Withdrawal Agreement. David Frost has continued to ruffle feathers, writes Catherine Feore.

In an op-ed in the Financial Times, Frost claims that the UK underestimated the effect of the protocol on goods movements to Northern Ireland. Frost asserts that the UK will “take no lectures on whether we are implementing the protocol — we are”, which is odd given that the UK has chosen to unilaterally suspend application of certain provisions, ignoring both the commitments made and the means within the agreement to deal with any dispute arising from the implementation of the agreement. The UK’s unilateral action has given the EU little choice but to take the first steps under its infringement procedure. 

Frost claims that the UK has been constructive and has made detailed proposals, for example, suggesting a veterinary agreement based on equivalence and for an authorised trader scheme to reduce checks, but says he has heard little back from the EU side in response to these suggestions. 

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However, the EU has repeatedly made it clear to the UK that an agreement based on equivalence would not be satisfactory despite the existence of equivalence agreements with other third countries, such as Canada and New Zealand. The Commission argue that the complexity and scale of the trade between the EU and UK would not meet the EU’s risk requirements. The UK has repeatedly said that because it has just left the EU it is in effect aligned with the EU and that the EU is using excessive caution. The EU in turn points out that the UK has repeatedly signalled its intent to diverge from EU rules as a benefit of leaving the EU.

Former Chief of Staff to Theresa May Gavin Barwell challenged some of Frost’s claims. In particular: “It's tempting to believe that - despite all the warnings - the government "underestimated the effect of the protocol", but I'm pretty sure it's not true. They knew it was a bad deal but agreed it to get Brexit done, intending to wriggle out of it later.” Which would suggest that the “bad faith” the Commission has identified started long before the Secretary of State for Northern Ireland acknowledged that the Internal Market Act would breach international law in a “specific and limited way”.

Today (7 June) a European Commission source outlined the concessions and flexibilities the UK was willing to offer. The source said that on medicines they acknowledged the problem and were exploring solutions that would allow, under certain conditions, certain functions to be located in GB for medicines specifically authorised for the NI market. The flexibility goes beyond those already allowed in urgent situations under EU law.  

The Commission are examining a derogation for guide dogs entering Northern Ireland from Great Britain based on an existing derogation in EU law concerning assistance dogs.

Other solutions are being put forward to everything from access to affordable second-hand cars through to changes to the VAT Margin Scheme to facilitating contacts between the UK and the European Food Safety Agency to expedite the risk assessment of any UK high-risk plants intended for export to the EU. 

The EU source said the EU’s IT teams are working flat out to ensure the swift handling of entry/exit data for SPS goods, but that the system would not be ready before 2022. There are also certain flexibilities on the tagging of animals and the Commission has recognised that there was an unanticipated problem on tariff rate quotas (TRQ) for steel, where the EU was exploring solutions.

Despite the willingness to accommodate some of the UK’s concerns the unilateral and the aggressive approach taken by Lord Frost has dampened hopes that this week’s meeting will reach any breakthrough. Diplomats from all 27 EU countries have decided to exercise their right to attend the meeting, suggesting that there is widespread interest. 

The European Council recently added the UK to the list of urgent issues for its May meeting and called for the full and effective implementation of the agreements and for their governance structures to be made operational.

Concern had also arisen about attempts by the UK to make discrete agreements with EU member states on a bilateral basis. In its conclusions the heads of government called on the UK to respect the principle of non-discrimination among member states.

A senior UK official briefing journalists this afternoon said the protocol has a number of objectives and claimed that the EU was only thinking of the protection of the single market - which of course is the vital and primary interest of the EU and its constituent parts. Nevertheless, the Ireland/Northern Ireland Protocol was itself a major compromise by the EU to recognise the special circumstances that exist in Northern Ireland. 

Brexit

Britain delays implementation of post-Brexit trade controls

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Britain said on Tuesday (14 Sseptember) it was delaying the implementation of some post-Brexit import controls, the second time they have been pushed back, citing pressures on businesses from the pandemic and global supply chain strain.

Britain left the European Union's single market at the end of last year but unlike Brussels which introduced border controls immediately, it staggered the introduction of import checks on goods such as food to give businesses time to adapt.

Having already delayed the introduction of checks by six months from April 1, the government has now pushed the need for full customs declarations and controls back to Jan. 1, 2022. Safety and security declarations will be required from July 1 next year.

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"We want businesses to focus on their recovery from the pandemic rather than have to deal with new requirements at the border, which is why we've set out a pragmatic new timetable for introducing full border controls," Brexit minister David Frost said.

"Businesses will now have more time to prepare for these controls which will be phased in throughout 2022."

Industry sources in the logistics and customs sector have also said the government's infrastructure was not ready to impose full checks.

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Brexit

How the EU will help mitigate the impact of Brexit

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A €5 billion EU fund will support people, companies and countries affected by the UK's withdrawal from the Union, EU affairs.

The end of the Brexit transition period, on 31 December 2020, marked the end of the free movement of people, goods, services and capital between the EU and the UK, with adverse social and economic consequences for people, businesses and public administrations on both sides.

To help Europeans adapt to the changes, in July 2020 EU leaders agreed to create the Brexit Adjustment Reserve, a €5bn fund (in 2018 prices) to be paid until 2025. EU countries will start receiving the resources by December, following Parliament’s approval. MEPs are expected to vote on the fund during the September plenary session.

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How much will go to my country?

The fund will help all EU countries, but the plan is for the countries and sectors worst affected by Brexit to receive the most support. Ireland tops the list, followed by the Netherlands, France, Germany and Belgium.

Three factors are taken into account to determine the amount for each country: the importance of trade with the UK, the value of fish caught in the UK exclusive economic zone and the size of population living in EU maritime regions closest to the UK.

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Infographic explaining the Brexit Adjustment Reserve
Infographic showing how much support individual EU countries will receive from the Brexit Adjustment Reserve  

What can be financed by the fund?

Only measures specifically set up to counter the negative consequences of the UK’s departure from the EU will be eligible for funding. These may include:

  • Investment in job creation, including short-term work programmes, re-skilling and training
  • Reintegration of EU citizens who have left the UK as a result of Brexit
  • Support for businesses (especially SMEs), self-employed people and local communities
  • Building customs facilities and ensuring the functioning of border, phytosanitary and security controls
  • Certification and licensing schemes

The fund will cover expenditure incurred between 1 January 2020 and 31 December 2023.

Fisheries and banking sectors

National governments are free to decide how much money goes to each area. However, countries that depend significantly on fisheries in the UK exclusive economic zone must commit a minimum amount of their national allocation to small-scale coastal fisheries, as well as local and regional communities dependent on fishing activities.

The financial and banking sectors, which may benefit from Brexit, are excluded.

Find out more 

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Data

Greater protection, innovation and growth in the UK’s data sector as announced by the UK's Digital Secretary

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The Information Commissioner’s Office (ICO) is set for an overhaul to drive greater innovation and growth in the UK’s data sector and better protect the public from major data threats, under planned reforms announced by the Digital Secretary Oliver Dowden

Bridget Treacy, partner (UK privacy and cybersecurity practice), Hunton Andrews Kurth, said: “The UK government has signalled an ambitious vision for reforming the UK’s data protection laws, simplifying the current regime, reducing red tape for business and encouraging data-led innovation. After careful analysis, the government believes it can significantly improve the UK’s data privacy regime and how it works in practice, while retaining high standards of protection for individuals. Far from attempting to replace the current regime, this looks like an attempt to fine tune it, making it better able to serve the needs of all stakeholders and a better fit for the digital age. 

“Taking a fresh look at international data flows is long overdue, and here it will be interesting to see how creative the UK government is prepared to be. Global data flows are an inevitable part of global commerce and the Covid-19 pandemic highlighted the need for global collaboration in research and innovation. The UK government wants to enable trusted and responsible data flows, without reducing protection for individuals, and without needless red tape. A more agile, flexible, risk-based and outcomes-driven approach for determining adequacy may improve data protection overall. But here the government will need to take particular care, assuming it wishes to retain the UK’s adequacy status in the EU.

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“It appears that even the Information Commissioner’s Office will be the subject of reform, with proposals to modernize the governance structure of the data protection regulator, set clear objectives and to ensure greater transparency and accountability. The ICO is a highly respected data protection regulator, offering much admired global leadership on difficult issues. Care will be needed to ensure the ICO’s much vaunted and highly valued independence are not compromised by the proposed reforms.

“Overall, this looks like a thoughtful attempt to improve the UK’s existing data protection regime, not through radical change, but by building on and fine tuning the existing framework to make it a better fit for our digital age. Organizations should welcome the opportunity to contribute to this consultation.”

Bojana Bellamy, president of Hunton Andrews Kurth’s Centre for Information Policy Leadership (CIPL), a pre-eminent global information policy think tank located in Washington, DC, London and Brussels said: “The UK government vision is a positive development and is much needed to address the opportunities and challenges of our digital age. The plans should be welcomed in both the U.K. and in the EU. This is not about lowering the level of data protection or getting rid of GDPR, it is about making the law actually work in practice, more effectively and in a way that creates benefits for all – organisations using data, individuals, regulators and the UK society and economy. Laws and regulatory practices need to evolve and be agile just like the technologies they are trying to regulate. Countries that create the flexible and innovative regulatory regimes will be better placed to respond to the Fourth Industrial Revolution we are witnessing today.

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“There is no doubt that some aspects of the GDPR do not work well, and some areas are unhelpfully obscure. For example, the rules for data use in scientific and industrial research and innovation are cumbersome to locate and analyse, hindering use and sharing of data for these beneficial purposes; it is difficult to use personal data for training AI algorithms to avoid bias; individuals’ consent to data processing has been rendered meaningless through over-use; and international data flows have become mired in red tape.

“The UK government’s bold vision to simplify the current data protection regime, reduce red tape, put more onus on organisations to manage and use data responsibly, and to reinforce the pivotal role of the UK privacy regulator is the right way forward. It achieves both effective protection for individuals and their data and enables data driven innovation, growth and societal benefits. Other governments and countries should follow the UK lead.

“It is high time to revamp the rules for international data flows and the UK Government is absolutely right to focus on enabling trusted and responsible data flows. Businesses in all sectors will welcome a more seamless regime for data transfers and adequacy decisions in respect of more countries. Corporate data privacy officers divert too much resource to addressing the legal technicalities of data flows from the EU, especially in the aftermath of the EU Schrems II judgement. Consumers and businesses would be better served by organisations focusing on privacy by design, risk impact assessments and building comprehensive privacy management programmes fit for the new digital economy. 

“It is encouraging that the government recognizes the UK Information Commissioner’s Office as a key digital regulator in the UK, with a critical remit of protecting both individuals’ information rights and enabling responsible data driven innovation and growth in the UK. The ICO has been a progressive regulator and influencer in the global regulatory community. The ICO must be given the resources and tools to be strategic, innovative, engaging early on with organisations using data and encouraging and rewarding best practices and accountability.”

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