Brexit and the waning days of the United Kingdom

[Zanza]

None of the four freedoms of the Single Market was granted, neither free movement of goods, nor of persons (or services or capital). While the new treaty gives Britain far reaching preferential trade in goods, it is not even close to the freedom of the Single Market. Don't believe the Tory spin. Despite what Johnson said, non tariff barriers will be very significant starting in one week. There is no mutual recognition, there are rules of origin, lots of sanitary checks for agrifood etc.

From a European perspective, the level of freedom agreed seems commensurate with the obligations agreed.

[Zanza]

So Turing was hounded by the British state during his lifetime and is now to have his name applied to a poundland sub-Erasmus scheme. They are such a shabby bunch.

That actually seems a more general approach. Some of the new regulators Britain will set up, e.g. for chemicals, are just a poorer copy&paste of the EU regulatory body. That's rather wasteful, creates lots of red tape and the potential upside of divergence is unclear. But Britain apparently often either was not interested at all or asked for preferential access to programs/institutions beyond what is on offer for third countries, which was then denied by the EU.

[Zanza]

Here is how the EU Commission compared the Single Market to the deal made with Britain:

[Iormlund]

Giving free trade without free movement.

Free trade as in tariff-free was something both parties would benefit from. Especially the EU, as the UK has a net trade deficit with the EU. The one area where UK had a trade surplus in was services, which are excluded.

There's no free movement of goods, which is what you might be thinking about. That is more about regulation than tariffs.

[Zanza]

EU accomplishes its mission of Brexit damage limitation

The bloc has maintained internal unity to a remarkable degree and achieved its main objectives

Ben Hall

The EU dealmaking machine has churned out another deal. Even in a year of momentous negotiations — on the pandemic recovery fund and rule of law safeguards — it is a remarkable achievement.

Four and a half years after the UK voted to leave the EU, London and Brussels have struck a free trade agreement that will frame their relationship for decades to come. It will maintain zero-tariff, zero-quota trade in goods in which the EU has a large surplus. It will help ease the inevitable frictions that come with the end of the transition period and provide the foundations for further talks on closer co-operation.

For the EU, this arduous task was always about limiting the damage from a UK withdrawal that has few upsides. From that perspective, it has been a resounding success both in terms of process and strategy. For a bloc that is so often hamstrung by divergent interests among its member states — and for British politicians who had banked on divide-and-conquer tactics — it has provided a lesson in the power of unity.

The UK's insistence on a narrow free trade deal meant talks were delegated to the European Commission. EU capitals were happy to go along as they became increasingly exasperated at British indecision, its false ultimatums and then a breach of trust when the UK government threatened to rip up parts of the withdrawal agreement. European governments had other priorities. Michel Barnier, the EU's skilful chief negotiator, kept them and the European parliament well informed and retained their confidence.

To be sure, the EU made substantial concessions during the course of 2020. It gave up on its demands that the European Court of Justice adjudicate disputes and that UK state aid, environmental and labour rules matched EU ones. It will also be busy with negotiations and quarrels with London for years to come — even if this agreement should provide for a more stable relationship than the multiple, transitory accords it has with Switzerland.

But the EU has achieved its main objectives. It has maintained internal unity to a remarkable degree, even with Eurosceptic governments more sympathetic to the Brexit cause. It stood up for a smaller member state, Ireland, which has most to lose from the UK's departure. But every member state could see itself losing out were the UK able to undercut EU state aid, environment or labour rules. The integrity of the single market has been preserved. The UK has agreed to binding constraints and adjudication.

Brexit Britain will not have its cake and eat it. The principle that single market access comes with obligations was essential to preserving the deterrent effect of Brexit. Political turmoil in the UK has made support for EU exit a political liability for Eurosceptics on the continent. Few openly advocate it. The power asymmetry in the process has been undeniable. The chaos at British ports this week following French border closures has underlined UK dependence on the goodwill of others.

Brigid Laffan, professor at the European University Institute in Florence, sees the EU's success as evidence that the bloc has entered a more assertive phase of governance, marshalling its power and resources to protect its interests. The Christmas Eve deal caps a year in which the EU has got its act together in tackling a new economic crisis.

Brexit might have galvanised the EU but it is probably an exception rather than the new rule. There are plenty of examples of European weakness stemming from its own divisions. When another third country, Turkey, disputed the sovereign waters of an EU member state — a challenge to EU integrity — the EU did little to push back because the interests of its members were not aligned. The continued efforts of nationalist governments in Poland and Hungary to dismantle democratic standards and the rule of law are an existential threat to a union that is built on fundamental values and a common legal order.

The effects of Brexit on internal EU policymaking will play out for years to come. It has already shifted the balance away from liberal-minded Atlanticist states. It has forced other countries, including the Netherlands, out from British coat-tails to defend their own interests. It has handed more influence to France and Germany.

Ultimately, says Catherine de Vries, professor at Bocconi university in Milan, much will depend on how Britain fares on the outside. "If the UK looks like it is going to do well in 10 years, that is going to create an interesting dynamic."

Before that, though, the UK and the EU will both have to adjust to the end of frictionless trade. Even with this deal, nobody is a winner.

[The Minsky Moment]

In fairness to Boris, the deal appears to be the best reasonably possible deal he could have reached under the circumstances. The biggest plus politically is that it cuts the legs out from Farage and the ultra Brexit hardliners- they may grumble, but there is no concrete concession of any principle they can latch on to.  In the long term for Britain, however, the more significant political consequence is cementing the existence of the Irish island as a single economic entity as separate from Albion.

For the EU the deal allows them to draw a line under a mess not of their making while leaving flexibility to revise it he arrangement later.

[Sheilbh]

In fairness to Boris, the deal appears to be the best reasonably possible deal he could have reached under the circumstances.

Agreed. This is about as good a deal as it was going to get if you decide that (and there is a logic to this): 1 - you need to end free movement given the importance of immigration in the campaign (which means no single market and no services) and 2 - the only way you will "benefit" from Brexit is by being able to diverge - either through lighter touch regulations, or more nimble/first-mover advantage (meaning you're probably out of the customs union and you need to avoid dynamic alignment). Once you make those two decisions (and May made 1 but not 2) then this is roughly the best case of where you'll end up

The biggest plus politically is that it cuts the legs out from Farage and the ultra Brexit hardliners- they may grumble, but there is no concrete concession of any principle they can latch on to.

Agreed. I think there is a space for Farage to re-emerge (a sort of populist anti-covid restrictions, pro-motorist, anti-energy transition politics) it's tough to see this deal/the EU forming part of that. He's basically surrendered and it's very unlikely that the ERG will have any relevance given Johnson's majority - and they may well split over this. In addition Labour have said they will vote for a deal which I think is politically sensible, but it feels more likely that the splits on the relations with the EU will be on the left which is a political win for Johnson. For the Tories it's simple - this will be the new status quo; but I can see the Greens and Lib Dems having a row over whether they just want closer relations with the EU or are full-on re-joiners and the same row will probably affect Labour.

In the long term for Britain, however, the more significant political consequence is cementing the existence of the Irish island as a single economic entity as separate from Albion.

Yes - admittedly also not a consequence that most British people in Britain particularly care about. The most passionate Brits (who are in Northern Ireland) are always disappointed at how tepid British feelings are towards Northern Ireland and, particularly, the view that it's a matter for the Irish (including the Northern Irish). I don't see this actually shifting politically any time soon given Sinn Fein's recent successes in the South which will re-frame the idea of a unified Ireland in the minds of many unionists. It's one thing if you're ending up with a sensible Fianna Fail or Fine Gael government. It's something else entirely if the South is voting in a Sinn Fein government as may happen in the next few years.

In a way I hope it leads to an economic renaissance for Northern Ireland as they really do have the best of both worlds.

For the EU the deal allows them to draw a line under a mess not of their making while leaving flexibility to revise it he arrangement later.

Agreed - I think the big risk for the EU is if this appears to be a success. Either because the expectations of the consequences were extreme and unrealistic (a real project fear) v the reality which is that we are likely to slowly become poorer, or because the UK does better relatively than certain other countries. I think it's a big risk for France and Italy's domestic politics where there is a more souverainiste/anti-European sentiment - plus reasonably successful parties like the Lega or RN who might exploit any perceived "success" of Brexit. If, in 5-10 years time, Brexit is viewed as not that bad or even a success in France or Italy I would keep an eye on their elections (especially v someone like Macron or a flabby party like the PD).

I would welcome them. Wales and Scotland are only countries in British domestic perspective though (and some sports), but are not seen as such in international law as state-level parties to treaties. Let's see if they can join European initiatives on their own. Northern Ireland is special.

Yeah - higher education is a devolved competency in the UK. So from a UK perspective they could certainly decide to join if they wanted to pay for it. I don't know if Erasmus/the EU would accept them on that basis.

That actually seems a more general approach. Some of the new regulators Britain will set up, e.g. for chemicals, are just a poorer copy&paste of the EU regulatory body. That's rather wasteful, creates lots of red tape and the potential upside of divergence is unclear. But Britain apparently often either was not interested at all or asked for preferential access to programs/institutions beyond what is on offer for third countries, which was then denied by the EU.

Agreed in the areas where the EU really does act as a single regulatory bloc - but that isn't always the case. So even in, for example, data protection which I work in there is a single law but there are 30 something different regulators (because it's a federal matter in Germany plus each member state, plus a committee of those regulators at a European level). They try to provide some guidance on how this single European law should be interpreted across Europe in a consistent way but, practically, certain member states are very strict/legalist and some are very pragmatic/pro-business; some regulators are very formalist and some are very substance focused. Also some member state regulators (like the UK) provide a lot of detailed guidance for business, the theory being it's important to explain what they expect of organisation; others take a view that the law is clear and it's for organisations to work out how to apply it in practice and their role as regulators is to enforce breaches.

So even if the law doesn't change the regulatory approach/interpretation could shift and the EU's approach might shift because they won't have input from the UK regulators which in general are on pragmatic/pro-business and substantive rather than legalist-formalist wing.

[Iormlund]

While strictly possible, divergence will still be hard to do in practice. Any business that wants to sell to the EU is going to adhere to our standards, whether they are selling cars or foodstuffs. Divergence will force them to package differently for both markets, segregate stock accordingly, etc.

[Sheilbh]

While strictly possible, divergence will still be hard to do in practice. Any business that wants to sell to the EU is going to adhere to our standards, whether they are selling cars or foodstuffs. Divergence will force them to package differently for both markets, segregate stock accordingly, etc.

Yes - but most big businesses are used to dealing with loads of different regulatory standards across the world, this isn't going to be that new for them. Again this is a bit like the "the UK will inevitably become a 51st state or a Chinese satrapy", that I don't really get the criticism. There are loads of different regulatory regimes that global businesses have to comply with already, the UK, like Canada, Australia, Japan and South Korea will just be one of the major minor jurisdictions that you need to deal with.

And it is worth saying in my experience there still isn't often a European approach (because there's lots of regulators) so we can all describe the law but that's not helpful for businesses they need to know practically how do regulators approach it. Often we'll get a view from one core EU jurisdiction and then circulate it to lawyers in other key European countries and ask for any material differences. There are in some areas surprisingly large divergences and businesses are disappointed there isn't actually a single "European" approach - I think this is why Europe needs more single regulators and less duplication of EU and member state regulators

[Iormlund]

It might be that our careers affect how we view this.

In industry and engineering the trend is certainly to standardize. Companies all over the world will often make products compliant with ANSI and EN/DIN standards. And regulatory bodies in other areas simply copy and paste those standards as their own (when they are not directly implemented as an ISO standard).

In these sectors divergence goes completely against the grain. Sure, loosen up your safety regulations and you might be able to sell cheaper SUVs to sub-Saharan Africa. But does that warrant all the headache? It's not the biggest market in the world. If it were it would have its own standards you'd have to follow. And just how much business are you going to open up when folks can simply buy a pick-up made in South Africa if that's the sort of thing they are looking for?

[Sheilbh]

It might be that our careers affect how we view this.

In industry and engineering the trend is certainly to standardize. Companies all over the world will often make products compliant with ANSI and EN/DIN standards. And regulatory bodies in other areas simply copy and paste those standards as their own (when they are not directly implemented as an ISO standard).

This is very true. In my sector there are ISOs but these don't necessarily meet the legal regulatory requirements. European regulators all look at the same law and come to different conclusions about what it means and most of my work is basically trying to help people weigh up the different risks because there is often no "right" answer of what compliant looks like (in some areas there are - in others it's spectacularly vague) and it probably looks different depending on your sector etc.

In these sectors divergence goes completely against the grain. Sure, loosen up your safety regulations and you might be able to sell cheaper SUVs to sub-Saharan Africa. But does that warrant all the headache? It's not the biggest market in the world. If it were it would have its own standards you'd have to follow. And just how much business are you going to open up when folks can simply buy a pick-up made in South Africa if that's the sort of thing they are looking for?

Absolutely and there will always be a trade-off basically of businesses wondering if the potential gains in the UK outweigh the costs of doing business. I think we are more likely to be seen as a similar jurisdiction to Canada or Japan or Korea where it is probably worth the trade-off than, say, South Africa where it might not be worth it - that's just because we're a richer country with a bigger economy.

I think the vaccine is an example of what the UK aspires to with divergence. That was under European law - and was open to all European states so I'm not saying it's necessarily a "Brexit benefit" because it's not. But I think the diverging approaches of the EU working to align all 27 member states (and the BionTech CEO said there weren't any other safety tests in the EU than the UK, it was just process and procedure) which has a lot of benefits but can be slower - especially in a non-crisis environment - while the UK used emergency procedures to try and do things quickly. I think that first mover advantage may be an area that this could happen in.

In the area I work in for example there's the e-Privacy directive (from 2002) which is the "cookie" directive and basically about a weird collection of things: mainly device-based data and electronic marketing (everything from Google ads to telemarketing). The intention since 2012 has been to move to a single European regulation in this area - the initial intent was that it would be finalised in 2016 and come into effect in 2018. There is still no draft from the Council, every six months we get an announcement from the new President that they plan to focus on finally finishing it because it's really important in, for example, the rules around online advertising or Apple. But there are very divergent opinion so every Presidency just gets nowhere. Obviously since 2002 the big new fact is everyone is carrying a small computer which wasn't really imaginable in 2002 and a lot of tech companies have developed far more intrusive profiles of us than was then possible. I think that could be an area where the UK may just try and develop a more up to date and clear regulation. Another area is AI - the EU is at the moment considering principles for ethical AI but there is no regulation in this field yet - there could be first mover advantage in doing that in the UK because it would, at least, clarify why is allowed as much as what isn't.

[mongers]

Bring on those sunlit uplands Boris. 

[Tamas]

I can't see any substantial gain (as in, practical advantage to some people) apart from two:
1. Dirty Europeans can be kept out.

2. No more EU slowing down things with competition laws and such.

I am fairly certain number 2 is what bugged the wealthy people sponsoring the leave side. Sure they will tell you it's because we lost sovereignty due to the EU courts being able to suggest you do something a certain way, but like in any other case that is bullshit. Practical/material interest (real or perceived) gives birth to ideology, not the other way around.

[The Brain]

They didn't get their pet passport? Blue passports was the whole point of all this.

[Tamas]

They didn't get their pet passport? Blue passports was the whole point of all this.

Ok 3 substantial gains