Source : Deloitte
This week’s top 5:
- UK Prime Minister Boris Johnson and European Commission President Ursula von der Leyen met on Wednesday evening to discuss the “state of play in the negotiations.” There are still “major differences between the two sides” with von der Leyen tweeting “we understand each other’s positions. They remain far apart.” Speaking to the BBC, Boris Johnson said there was a “strong possibility of no deal”.
- UK chief negotiator Lord Frost and EU chief negotiator Michel Barnier will continue trade negotiations over the coming days with both sides agreeing a “firm decision should be taken about the future of the talks by Sunday.”
- The European Commission has presented a limited set of contingency measures “to cater for the period during which there is no agreement in place”. Von der Leyen said “our responsibility is to be prepared for all eventualities, including not having a deal in place with the UK on 1 January 2021.”
- German Chancellor Angela Merkel told the Bundestag “there is still the chance of an agreement”. However, Merkel added “if there are conditions from the British side that we can’t accept, we are prepared to go down a path without a trade deal”.
- On Tuesday, the EU-UK Joint Committee announced an agreement in principle in several areas including Border Control Posts, export declarations and a clarification on the application of State aid under the terms of the Northern Ireland (NI) Protocol. European Commission Vice-President Maroš Šefčovič tweeted “given the limited time before the transition period ends, it was key to reach mutually agreed solutions.”
Business
Taxation Bill
The UK government introduced the Taxation Bill which implements key aspects of the NI Protocol in UK legislation. Financial Secretary to the Treasury Jesse Norman said “this Bill delivers on the government’s commitment to upholding the Good Friday Agreement, ensuring trade can continue in line with the agreement reached in the Northern Ireland Protocol.”
Speaking in the House of Commons, Cabinet Minister Michael Gove announced a trusted trader scheme whereby under the agreement reached by the Joint Committee “Northern Ireland businesses selling to consumers or using goods in Northern Ireland will be free of all tariffs”. A new Command Paper has now been published which details that export summary declarations will not generally be needed, and helps to classify which goods will be defined as “at risk” for customs purposes. A new UK Trader Scheme will allow goods to be routed from GB to NI through Irish ports under transit procedures. The Command Paper also confirms there will be no separate VAT registration for NI.
Trade agreements
The UK government has secured a Services Mobility Agreement with Switzerland. This will allow certain professions to work visa free between the two countries for up to 90 days a year. International Trade Secretary Liz Truss said this deal “provides vital continuity for businesses and paves the way for a more advanced deal with Switzerland in the future.”
Several other agreements have now been signed including Norway and Iceland, Egypt, Singapore and Vietnam. Only 2% of UK trade which was conducted under EU FTAs now remains uncovered by new agreements, with Mexico and Turkey the largest two outstanding.
