- A Brexit deal was agreed on Christmas Eve, after months of negotiations which had been stuck on the level playing field, fishing rights, and the structure of any agreement. The deal came after continued involvement from Boris Johnson and Ursula von der Leyen, throughout December.
- Key to unlocking the deal was an agreement on the level playing field which saw the UK and EU agree to a new framework on state aid and its enforcement. Included in the deal is a new “rebalancing clause”, which would allow either side to (via an arbitration panel) introduce tariffs if, in the limited areas covered by the level playing field, divergence opened up between the two sides that distorted trade. Further agreement was struck on fisheries, with the UK and EU now set to use different allocations of fishing quotas, phased in over a five and a half year period with annual negotiations over access and quotas beyond that.
- The deal will now need to be ratified by the UK and European Union before the end of the transition period on 31 December. In the UK that is expected to happen on 30 December, with Parliament recalled that day for a vote. On the European side, the deal has been provisionally applied until 28 February 2021, with European Parliament approval to follow.
- The deal provides for tariff free quota free access where goods meet the rules of origin set out in the FTA. However, the deal does not replicate the market access the UK had as a member of the EU Single Market and Customs Union. Businesses will still face barriers to trading between the UK and the EU, including complying with dual regulatory regimes, and needing to meet local rules governing the provision of services.