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24 JAN 2020

“IN THE LONG TERM, IT IS A LITTLE MORE TRICKY...”

As Brexit Day approaches, Julian Francis looks ahead to what the future may hold

T

he UK leaves the European Union in less than a week, ending 47 years of membership. The process is now irreversible, largely thanks to the large majority now behind Boris Johnson who has pushed the Withdrawal Bill through both Houses and it has received royal assent. All that remains is for the European Parliament to agree, which it will do this Wednesday, for the process to be completed.

As we edge closer to 31 January, we will hear a great deal of political chatter on the “new dawn” and symbolism of “Brexit Day”, arguments over celebrations in Westminster and commemorative coins and stamps marking our new found independence from Europe. But what does all this really mean? The short answer is… not that much… in 2020, at least.

The transition agreement that forms part of our withdrawal from the EU will ensure that the UK continues to access the benefits of membership until December 31 2020. This means that you the same access to EU markets as before, the same freedom of movement, and the same rules around importing goods from the EU. 

In the long term, it is a little more tricky.

The transition period was agreed to by former Prime Minister Theresa May. Initially set to last around two years, because of successive delays since the original negotiation, the transition period will now only last 11 months. This date isn’t set in stone and can be extended once by up to two years, if the UK and EU jointly decide to do so before 1 July 2020.

However, publicly Mr Johnson has been adamant he will not consider extending the transitional period and has even included legislation in the Brexit Bill preventing a Minister from agreeing to any extension to the transition. This effectively removes the ability of the House of Commons to extend the transition against the initial wishes of the Government.

But what is it for? The transition period is designed to allow the UK and EU to work out their new trading relationship and this will be where we focus our attention in the next few months. Issues up for discussion will include technical standards, market access, security and movement. The future relationship between the EU and the UK will be shaped by the discussions over these crucial 11 months. Mr Johnson has indicated he would prefer a relatively loose free trade agreement that would see the UK leave the Single Market and Customs Union and end jurisdiction of the European Court of Justice (ECJ).

The Prime Minister has argued that as the UK is currently completely aligned to EU rules, this negotiation should be straightforward. But critics have pointed out that the UK wishes to have the freedom to diverge from EU rules in the future so it can strike trade deals with other countries. This will make negotiations more complex. 

It's not just a trade deal that needs to be agreed. The UK must decide on how it is going to co-operate with the EU on security and law enforcement. The UK is set to leave the European Arrest Warrant scheme and will have to agree a replacement system. It must also agree deals in a number of other areas where co-operation is needed.

If a deal is not reached on time the UK would resort back to international conventions for security and trade on WTO terms, which would be very similar to the terms of a so-called "no-deal Brexit". Northern Ireland, however, would be an exception to this owing to the goods trading relationship with the EU covered by the provisions in the Northern Ireland protocol.

ACE will continue to engage with members, stakeholder and the government to ensure that the needs of the engineering consultancy sector are understood and catered for in the new economic environment that we will find ourselves in.

ACE members can access a suite of bespoke Brexit Briefings and analysis, including our useful FAQ, here.

Julian Francis

Julian Francis

Director of External Affairs

Julian leads the creation of policy and government engagement strategy at ACE.

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