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Excluding Northern Irish imports from EU tariff rate quotas

22-12-2020

The United Kingdom (UK) withdrew from the European Union (EU) on 1 February 2020. The Withdrawal Agreement, which entered into force on 1 February 2020, provides for a transition period during which the UK will remain in the EU's single market and customs union until 1 January 2021. The Withdrawal Agreement also includes a Protocol on Ireland/Northern Ireland, which states that Northern Ireland will be part of the UK's customs territory and internal market after the transition, but that goods originating ...

The United Kingdom (UK) withdrew from the European Union (EU) on 1 February 2020. The Withdrawal Agreement, which entered into force on 1 February 2020, provides for a transition period during which the UK will remain in the EU's single market and customs union until 1 January 2021. The Withdrawal Agreement also includes a Protocol on Ireland/Northern Ireland, which states that Northern Ireland will be part of the UK's customs territory and internal market after the transition, but that goods originating in Northern Ireland have access to the EU without tariffs or quotas, and that EU law relating to competition and trade is applicable to Northern Ireland. While the Protocol creates obligations between the UK and the EU, and specifically allows for the free movement of goods between Northern Ireland and the EU and vice versa, it does not create obligations vis-à-vis third countries. This could lead to circumvention of the use of EU tariff rate quotas and pose a risk to the proper functioning of the EU single market and the integrity of the common commercial policy. To address these risks and provide legal clarification, the European Commission adopted a legislative proposal on 14 August 2020 setting out that goods imported to Northern Ireland from non-EU countries would not benefit from the EU tariff rate quotas and other import quotas unless ultimately destined for the EU. With just a single amendment, to bring forward entry into force (but not change the date of application, 1 January 2021), corresponding to the Council's position, the European Parliament voted on the report in plenary on 25 November 2020. The regulation was then adopted by the Council at first reading, and signed by the Presidents of the two branches of the EU legislature on 16 December 2020.

UK trade agreements with third countries: Implications for the EU

22-12-2020

The United Kingdom (UK) left the European Union (EU) on 1 February 2020 and will regain competence for its own international trade policy as soon as the transition period concludes at the end of 2020. Freedom to determine its own trade relationships was a major reason for the UK's withdrawal from the EU: its new international trade policy is based on the goal of establishing 'global Britain', a country asserting that it is strongly committed to trade openness with international leadership. To this ...

The United Kingdom (UK) left the European Union (EU) on 1 February 2020 and will regain competence for its own international trade policy as soon as the transition period concludes at the end of 2020. Freedom to determine its own trade relationships was a major reason for the UK's withdrawal from the EU: its new international trade policy is based on the goal of establishing 'global Britain', a country asserting that it is strongly committed to trade openness with international leadership. To this end, the UK has concluded as many continuity agreements as possible, in order to roll over existing EU free trade agreements (FTAs), such as that with South Korea. It has also renegotiated, rather than simply roll over, the provisions of EU FTAs, with partners who so demanded, including Japan. Beyond those countries with EU FTAs to which the UK has been party, it has expanded the range of its FTA negotiations to Australia, New Zealand and the United States (US), three of its major trading partners. When it comes to geographic scope, the UK has set the Pacific as a high priority, its objective being to access the newly established Comprehensive and Progressive Trans-Pacific Partnership (CPTPP). In addition, the UK aims to use its advantage in digital trade and services to become a 'world digital trade powerhouse', and has stressed that FTA provisions should promote digital trade and foster regulatory cooperation in the field. The EU represents 50 % of the UK's total trade, and the UK economy is integrated with and reliant on the EU. Therefore, although the UK is facing obstacles in signing trade agreements, its new strategy has a number of implications for the EU. The UK is committed to remaining an open country with respect to international trade and its focus on digital trade and services, which depend less on geography, is seen as a way to diversify away from the EU.

UK Internal Market Bill and the Withdrawal Agreement

20-11-2020

On 9 September 2020, the United Kingdom (UK) government tabled a bill in the House of Commons which would govern the country's internal market after the Brexit transition period ends. It aims to allow goods and services to flow freely between the four jurisdictions of the UK – England, Scotland, Wales and Northern Ireland – replacing the rules now in place through membership of the EU's single market. Certain parts of this UK Internal Market Bill are particularly controversial, as they explicitly ...

On 9 September 2020, the United Kingdom (UK) government tabled a bill in the House of Commons which would govern the country's internal market after the Brexit transition period ends. It aims to allow goods and services to flow freely between the four jurisdictions of the UK – England, Scotland, Wales and Northern Ireland – replacing the rules now in place through membership of the EU's single market. Certain parts of this UK Internal Market Bill are particularly controversial, as they explicitly contravene the Protocol on Ireland/Northern Ireland attached to the Withdrawal Agreement (WA) that was ratified in January 2020. First, the bill provides that the UK government may authorise Northern Ireland businesses not to complete exit summary declarations when sending goods to Great Britain, thereby breaching the Union Customs Code applicable to NI. The bill would also allow the UK government to interpret, dis-apply or modify the application of the State aid rules of the European Union, which are applicable to UK measures that affect trade between Northern Ireland and the EU. Last but not least, the bill provides that UK regulations in these areas will have effect notwithstanding their incompatibility with relevant domestic or international law, including the Withdrawal Agreement. The reaction of the European Commission to the bill was immediate, calling for an extraordinary meeting of the EU-UK Joint Committee, which was held the following day, 10 September. On 1 October, the Commission sent a letter of formal notice to the UK for breaching its obligations under the WA, marking the beginning of an infringement process against the UK. As the UK did not reply by the end of October, the Commission may now proceed with the process, sending a Reasoned Opinion to the UK. Meanwhile, the bill has passed third reading in the House of Commons, even if in the House of Lords the government has been heavily defeated, with amendments removing the controversial clauses. While the government has indicated its intention to re-table the clauses when the bill returns to the Commons in December, it would be open to it to no longer press for their inclusion, if and when agreement is reached in the ongoing negotiations on the future EU-UK relationship.

New EU-UK partnership

16-06-2020

Following the withdrawal of the United Kingdom from the European Union, the two parties are negotiating their future relationship, with a view to sealing an agreement that will enter into force after the transition period ends on 31 December 2020. After the fourth round of negotiations ending on 5 June 2020, a number of critical points of divergence remain, with only limited progress made so far towards resolving them. The European Parliament is expected to vote on a recommendation on the negotiations ...

Following the withdrawal of the United Kingdom from the European Union, the two parties are negotiating their future relationship, with a view to sealing an agreement that will enter into force after the transition period ends on 31 December 2020. After the fourth round of negotiations ending on 5 June 2020, a number of critical points of divergence remain, with only limited progress made so far towards resolving them. The European Parliament is expected to vote on a recommendation on the negotiations during its June plenary session.

Three critical issues in EU-UK relations

08-06-2020

Following the withdrawal of the United Kingdom (UK) from the European Union (EU) on 1 February 2020, the EU and the UK launched negotiations on a new partnership agreement, to come into effect at the end of the transition period, scheduled for 31 December 2020. The negotiations are intended to address nearly all the domains covered in the Political Declaration negotiated by both parties alongside the Withdrawal Agreement, including trade and economics, fisheries, thematic cooperation, and internal ...

Following the withdrawal of the United Kingdom (UK) from the European Union (EU) on 1 February 2020, the EU and the UK launched negotiations on a new partnership agreement, to come into effect at the end of the transition period, scheduled for 31 December 2020. The negotiations are intended to address nearly all the domains covered in the Political Declaration negotiated by both parties alongside the Withdrawal Agreement, including trade and economics, fisheries, thematic cooperation, and internal and external security. As far as negotiations on the future economic relationship are concerned, while the parties agree in principle on an exceptional zero-tariff and zero-quota comprehensive and balanced free trade agreement (FTA) aiming for as 'frictionless' trade as possible, they still disagree on major aspects of the economic partnership, especially fisheries and level playing-field (LPF) commitments. The EU wants the future agreement in the fisheries domain to retain the status quo as far as possible, including reciprocal access to waters in return for access to markets and quota-shares that are based on historical fishing patterns. The EU also insists that an effective LPF would ensure fair competition. After the third round of talks, which took place in May 2020, the UK's chief negotiator, David Frost, said that the EU proposal on fisheries was ‘simply not realistic’, and it was unacceptable that the LPF binds the UK to EU law or standards; if need be, the UK would aim for a less ambitious FTA. The EU's chief negotiator, Michel Barnier, said that negotiating an FTA providing for tariffs would be far more time-consuming, and the EU would still demand the same LPF commitments because 'open and fair competition is not a "nice-to-have", it is a "must-have" '. Following the fourth round of negotiations, from 2 to 5 June, the positions therefore still seemed irreconcilable. However, the long stand-off in the earlier negotiations on UK withdrawal had seemed equally irreconcilable before the final agreement was reached and then ratified. One area in which the two sides did manage to agree in those negotiations is the financial settlement included in the Withdrawal Agreement. While that settlement is now being implemented, it had initially been seen as one of the more difficult areas of the withdrawal negotiations.

EU export authorisation scheme for personal protection equipment

26-05-2020

In the midst of the outbreak of the coronavirus pandemic, the European Commission issued an implementing regulation requiring authorisations for exports of personal protection equipment (PPE), effective as of 15 March 2020 for a six-week period. A second implementing regulation extended the period for another 30 days. The latter reduced the range of products subject to authorisation to three categories, namely mouth-nose protection, protective spectacles and visors, and protective garments; gloves ...

In the midst of the outbreak of the coronavirus pandemic, the European Commission issued an implementing regulation requiring authorisations for exports of personal protection equipment (PPE), effective as of 15 March 2020 for a six-week period. A second implementing regulation extended the period for another 30 days. The latter reduced the range of products subject to authorisation to three categories, namely mouth-nose protection, protective spectacles and visors, and protective garments; gloves and face shields were dropped from the list. The authorisations are granted by national competent authorities, and must be coordinated with the Commission's new 'clearing house for medical equipment' and the rescEU stockpile of medical equipment in order to verify that the PPE being exported is not needed by other EU Member States in their fight against coronavirus. The export authorisation regulations are among the EU coordination and solidarity mechanisms implemented by the European Commission. A mapping of exports and imports of PPE subject to authorisation shows that, even though the EU runs a large trade surplus for medical products in general, it had been running trade deficits on these specific products for the last decade. The scale of trade in these products is also very small since imports represented as little as 0.05 % of EU gross domestic product (GDP) in 2019. This all goes to show how what amounts to a tiny portion of international trade can have dramatic consequences.

Canada: Coronavirus movement restrictions and quarantine

27-04-2020

Like many other countries around the world, Canada has introduced restrictions in an attempt to slow the spread of Covid-19 in the country. Federal and provincial governments have taken measures to limit international and domestic travel. Canada has prohibited entry to foreign nationals, with a few exemptions. Some provinces and territories have prohibited entry to non-residents and/or imposed self-quarantine on travellers.

Like many other countries around the world, Canada has introduced restrictions in an attempt to slow the spread of Covid-19 in the country. Federal and provincial governments have taken measures to limit international and domestic travel. Canada has prohibited entry to foreign nationals, with a few exemptions. Some provinces and territories have prohibited entry to non-residents and/or imposed self-quarantine on travellers.

EU imports and exports of medical equipment

21-04-2020

The crisis caused by the coronavirus pandemic has, with tragic consequences, brought to the fore the fact that the European Union (EU) is dependent on non-EU sources for medical equipment such as personal protection equipment (including masks) and artificial respiratory equipment, as well as other products needed in the fight against the virus. In response to shortages, Member States have taken initiatives to produce and distribute medical equipment and the EU has put in place a number of coordinated ...

The crisis caused by the coronavirus pandemic has, with tragic consequences, brought to the fore the fact that the European Union (EU) is dependent on non-EU sources for medical equipment such as personal protection equipment (including masks) and artificial respiratory equipment, as well as other products needed in the fight against the virus. In response to shortages, Member States have taken initiatives to produce and distribute medical equipment and the EU has put in place a number of coordinated responses, such as the creation of the rescEU stockpile of emergency medical equipment, and the restriction of exports of personal protective equipment outside the European Union. A mapping of EU trade in four categories of product – pharmaceuticals, medical equipment, personal protection and medical supplies – shows that, in all four categories, as few as five trade partners provide about 75 % of EU imports. Exports are more diffuse, with five partners receiving approximately half of EU exports. In 2019, the EU was a net exporter of medical products in all four categories, with pharmaceutical products representing most of its trade surplus of medical products. The weaker domain is personal protection products. The main EU import partners are Switzerland, the United Kingdom, the United States, China, and Singapore, with the first three appearing among the top four countries in all categories. Additional insights into the value chains of chemical and pharmaceutical sector production in the EU's top five import partners suggest that China and other countries provide a far larger share in raw materials and manufacturing than direct imports suggest. These results imply that the production of medical products is far more scattered than direct import numbers would suggest.

Future EU-UK trade relationship: Rules of origin

03-04-2020

The United Kingdom (UK) withdrew from the European Union (EU) on 1 February 2020, and moved into the agreed transition period, running until 31 December 2020. The EU and UK have launched negotiations towards a free trade agreement (FTA) that will shape their future trade relationship. Both parties expressed a preference for reducing 'trade frictions' to the extent possible, and rules of origin will play a role in that regard. Rules of origin (RoO) are provisions in FTAs that govern the conditions ...

The United Kingdom (UK) withdrew from the European Union (EU) on 1 February 2020, and moved into the agreed transition period, running until 31 December 2020. The EU and UK have launched negotiations towards a free trade agreement (FTA) that will shape their future trade relationship. Both parties expressed a preference for reducing 'trade frictions' to the extent possible, and rules of origin will play a role in that regard. Rules of origin (RoO) are provisions in FTAs that govern the conditions under which an imported good is recognised to 'originate' from the FTA partner country and becomes eligible for preferential trade. These conditions are restrictive – implying trade 'frictions' – to various degrees and designed product-by-product, following operation- and/or value creation-based rules. Importantly, the EU's RoO admit the 'cumulation' of preferential origin across other existing FTAs signed by both parties. As RoO thus create incentives for manufacturers to allocate production and sourcing across countries, they are an important trade instrument. The European Commission and European Parliament favour RoO provisions in the EU-UK FTA that are consistent with the EU template and protect the EU's interest; the UK government has declared that it is seeking 'appropriate and modern' RoO, providing for cumulation across common FTA partners. The EU and UK positions therefore converge in favour of unrestrictive RoO. Nevertheless, the geographical distance between the EU and UK is short and the resulting shipping costs low. In this context, should the UK unilaterally lower its production costs after the transition period – through, for instance, lower labour and environmental standards, and State aid – less restrictive RoO will provide manufacturers with incentives to increase the UK share in the production chain, penalising the EU. This explains the call in the Political Declaration for frictionless trade 'and' the alignment of standards. Indeed, protecting EU interests implies that RoO are likely to be restrictive, unless the UK commits to aligning standards.

Future EU-UK trade relationship

20-02-2020

The withdrawal of the United Kingdom (UK) from the European Union (EU) came into effect on 1 February 2020, following the large majority gained by the Conservative Party, led by Boris Johnson, in the UK general election in December 2019. The transition period began on the same day and is due to run until the end of 2020. During this period, although no longer part of the EU institutions, the UK remains in the customs union and single market, and within the jurisdiction of the Court of Justice of ...

The withdrawal of the United Kingdom (UK) from the European Union (EU) came into effect on 1 February 2020, following the large majority gained by the Conservative Party, led by Boris Johnson, in the UK general election in December 2019. The transition period began on the same day and is due to run until the end of 2020. During this period, although no longer part of the EU institutions, the UK remains in the customs union and single market, and within the jurisdiction of the Court of Justice of the EU (with some exceptions). Negotiations during the transition period are aimed at reaching agreements that will shape the future EU-UK relationship in a range of domains, and especially that of trade. In the Political Declaration accompanying the Withdrawal Agreement, the EU and the UK 'agree to develop an ambitious, wide-ranging and balanced economic partnership'. However, some major obstacles have surfaced. The UK insists that it is unwilling to submit to EU Court of Justice jurisdiction, and demands autonomy in its regulatory and trade policies. The UK indicates that it seeks a free trade agreement similar to that agreed between the EU and Canada: comprehensive, but very different to the previous relationship. The EU has taken note of the UK objectives, but emphasises that the deeper the trade agreement, the more UK regulations and standards must align with those of the EU. To the EU, alignment is essential to preserve a level playing field, on the grounds that the EU and UK are close neighbouring economies and strongly interconnected. The European Commission's 3 February 2020 recommendation for a Council decision authorising the opening of negotiations on the future relationship confirms this approach. In this context, time is critical. The Withdrawal Agreement allows for an extension to the transition period, but the UK Withdrawal Act explicitly prohibits extension. In addition, to allow for ratification, the trade agreement should be ready well ahead of the end of the transition period. The Commission recommendation insists on including fisheries (a highly sensitive area of negotiation), in the new economic partnership and that related provisions should be established by 1 July 2020. Time-constrained negotiation may give rise to a limited economic and trade agreement that covers only priority areas, rather than the ambitious single comprehensive agreement sought under the Political Declaration and Commission recommendation.

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