Welcome to the View from Brussels which is a monthly blog by Edward Simpson, FLA Head of Government Affairs, on developments from across The Channel.
22 October 2020
In my earlier blogs, I expressed pessimism over the chances of an agreement between Boris Johnson’s Government and the EU on a future relationship. It didn’t bode well as the Prime Minister’s 15 October cut-off for a deal came and went as so many other deadlines have done in the Brexit saga.
For once, it doesn’t feel like the end of the road. In recent weeks progress has been made, notably on state aid which was one of two long-standing dividing lines. Giving evidence to the House of Lords, David Frost, the lead UK negotiator, suggested the two sides were close to reaching a compromise under which subsidies would be allowed to address market failure, but not as a means to distort trade and investment.
This leaves fishing rights as the main stumbling block. Fishing represents just 0.1% of the UK economy, but the Government cannot be seen to sell out the many coastal towns where it is embedded in the community. For those with longer memories, it still rankles that the EU Common Fisheries Policy was rushed through without the UK having a veto – indeed during the referendum campaign Michael Gove explained that his early views on Europe were influenced by the fact that his father worked in the fishing industry.
A vocal group in support of the industry exists in France, Spain, Portugal, The Netherlands and Belgium. In the latter, Flemish fishermen who derive half of their income from catches made in British waters, are threatening to invoke a 17th century promise from King Charles II that 50 boats from Bruges would have a perpetual right to fish there. The French too have cited medieval rights to trawl in British seas. There is a chance that this issue ends up in the courts. More likely is that quotas are phased out over time and that Norway’s arrangements with the EU become the template, though the UK is keen to avoid annual negotiations, so a multi-year approach may represent the optimal outcome.
So where does this leave the prospects of agreeing future arrangements over the next ten weeks?
In a positive sign, yesterday the UK Government agreed with Brussels to “intensify” talks. Both parties will prepare legal texts that could form the basis of a deal. The UK may have to make concessions on its Internal Market Bill (which gives it powers to override the Northern Ireland Protocol) and accept the EU courts having a role to play in future dispute resolution. Whilst it is unrealistic to expect that a comprehensive trade deal will be signed off by the end of the year, there should be enough time to agree workable arrangements that allow a series of mini-negotiations on various topics to continue. This will include financial services which sits outside the framework of these negotiations, and which has been granted a lifeline with Commission agreement to an 18 month extension for more pressing aspects of the equivalence regime. It won’t be plain sailing of course – expect delays at UK and French ports – but there is the prospect of calmer waters.