The UK government published its controversial Northern Ireland Protocol Bill today in a move described by foreign secretary Liz Truss as a ‘fix’ to post-Brexit trade issues between Great Britain and NI.
However legal experts and some Tory MPs say the bill is illegal under international law, with the EU now preparing to take legal action against the UK.
Prime minister Boris Johnson denies the legislation breaks international law, today calling the bill a “relatively trivial set of adjustments” and arguing the move is necessary to protect the 1998 Good Friday Agreement.
‘Possible trade war’
The EU will respond by taking legal action against the UK in a matter of days, officials in Brussels told the FT and RTE, with the FT reporting that “the two sides are edging closer to a possible trade war”.
One option for the EU is to cancel parts of its post-Brexit trade deal, the EU-UK Trade and Cooperation Agreement, by applying tariffs to British goods.
The bill will be debated and voted on by parliament – perhaps before the summer recess – with opposition expected in both the House of Commons and the Lords.
What’s in the bill
As expected, the bill published before 6pm today (Monday 13 June) would:
- Green and red channels
The bill would create a green lane for goods from GB destined to remain in NI, allowing for fewer customs checks, and a red lane with existing checks for goods destined for the Republic of Ireland, ie the EU. Foreign secretary Liz Truss has previously said this would be implemented using a ‘trusted trader’ scheme
- Dual regulatory system
The bill allows British firms exporting to Northern Ireland to choose between meeting EU or UK standards on regulation, “which are expected to increasingly diverge,” according to the Guardian.
- Taxation and state aid
The bill would bring an end to EU control over state aid and value added tax in Northern Ireland. A recent VAT cut on energy-saving materials could not be implemented in NI because of EU tax rules
- Curbing the ECJ
The bill would end oversight by the European Court of Justice on any trade disputes, which instead would be dealt with by “independent arbitration”
- Future powers
In Clause 15 of the bill, ministers are given sweeping powers to change almost every aspect of the protocol’s text. The government describes this as an insurance policy “rather than the right to sweep away further chunks of the agreement,” the Guardian reports.
Reaction: ‘Low point’
The bill is heightening tensions in the UK’s prolonged negotiations with the EU over the future implementation of the protocol.
Irish Taoiseach (prime minister) Micheal Martin has described the UK’s plans in the BBC as a “low point” and “very regrettable”, while Ireland’s foreign secretary Simon Coveney called the legislation a “big deal”.
Coveney today told reporters, including the Irish Times:
“If you are legislating to set aside elements of an international treaty, which is international law, well then you’re breaking international law”
‘Fix the protocol problems’
UK ministers have defended the proposals, with Truss saying that the UK wants to “fix the problems with the NI Protocol and restore political stability” in the region. She added that the EU needed to be more “willing to change”.
NI secretary Brandon Lewis has also defended the legislation as being “lawful” and “correct” on the basis of independent legal advice the government has received from Sir James Eadie QC.
He told Sky News’ Sophy Ridge yesterday that “people will see that what we’re proposing resolves the key issues within the Protocol.”
‘Time to do a deal’
Tony Danker, the director general of the CBI, told the Guardian that both sides needed to do more to reach a deal that satisfies all parties – including businesses in Northern Ireland. He said:
“I don’t think it’s time for grandstanding. I think it’s time to do a deal.
“I’m firmly of the view the Europeans are being inflexible. At the same time, our measures to take unilateral action in response are unhelpful.”
IOE&IT response: ‘Facilitation is key’
IOE&IT director general Marco Forgione has also said that steps need to be taken to “help facilitate the free flow of goods and services” between Great Britain and Northern Ireland and called “on both sides to come together and solve this in a way that meets the needs of business”.
Forgione, currently attending the 12th Ministerial Conference at the World Trade Organisation in Geneva, highlighted the role that trade facilitation has to play in addressing issues such as those that are currently being experienced in Northern Ireland.
“One of the most significant issues being discussed here in Geneva is global trade facilitation.”
“It is a timely reminder of the importance education plays in empowering organisations and equipping individuals with the expertise to trade effectively, sustainability and competitively.”
Published by the Institute of Export