The UK-EU Trade and Cooperation Agreement

The UK and EU Government have agreed a deal this afternoon on their future relationship. This followed ongoing meetings between the negotiating teams as well as “hotline” talks between Prime Minister Boris Johnson and European Commission President Ursula von der Leyen.  The legal text has been published here. Last night, officials briefed journalists with hopeful signs but the deal wasn’t confirmed until 2:44pm this afternoon. The official press statement from Downing Street is: “Everything that the British public was promised during the 2016 referendum and in the general election last year is delivered by this deal. We have taken back control of our money, borders, laws, trade and our fishing waters.” “The deal also guarantees that we are no longer in the lunar pull of the EU, we are not bound by EU rules, there is no role for the European Court of Justice and all of our key red lines about returning sovereignty have been achieved.” At a press conference in Downing Street, the UK Prime Minister announced that the people’s will had been delivered and that the UK has secured a “comprehensive, Canada-style free trade deal”  worth £660bn per year, that will “allow UK goods to be sold without tariffs and without quotas in the EU market”. He further stated that “we’ve taken back control of our laws and our destiny… in a way that is complete and unfettered”, and “resolved a question that has bedevilled our politics for decades”. Johnson added that concessions had been made on both sides but that Britain should be very pleased with a result that “takes back control”. Ursula von der Leyen also spoke to the press, saying it was a “fair and balanced” deal; the full press conference is available to view here. She tweeted that “it was worth fighting for this deal. We now have a fair & balanced agreement with the UK. It will protect our EU interests, ensure fair competition & provide predictability for our fishing communities.” statement was also published by the President of the European Parliament David Sassoli and the Head of Parliament’s UK Coordination Group David McAllister on the agreement. Over the past few week, fisheries was the key point of contention preventing a deal, but both sides have now made concessions on this issue. The UK wanted reviews every three years on the fisheries settlement, while the EU argued for 14 years, but both sides have now agreed to a five-and-a-half year period of fixed arrangements. Broadly the deal outlines:  
  • A framework for the future relationship – this follows what the joint commitments set out in the Political Declaration (PD)
  • Governance of the future relationship – A binding mechanism for dispute settlement, with provision for unilateral sanctions where necessary. There will also be a review of the whole deal after four years. The European Court of Justice will henceforth have no role to play in matters affecting the UK.
  • The ‘level playing field’ – The UK has secured a tariff-free, quota-free deal with the EU. Subject to independent third-party arbitration, either the UK or the EU can take action to protect their own interests where it has been determined that one has sought to undercut another for unfair advantage; such action could potentially include the imposition of tariffs.
  • Fisheries – For the next five and a half years, there will be a set transition agreement whereby the UK share of fish in our waters will rise from roughly half to approximately two thirds by the end of this period. After this point, there will theoretically be no limit to the UK share.
  • Police and judicial co-operation in criminal matters.
Next steps towards ratification: 
  • The deal is a ‘mixed agreement’, as opposed to an ‘EU-only’ one which means it covers policies that both the EU and individual member states (jointly or independently) can legislate for. This means for ratification that the EU Council leaders, the European Parliament, UK Parliament and the national and regional European Parliaments will be required to vote on the deal.  EU only deals can be voted on by ministers only.
  • EU member states’ Ambassadors will be invited by the European Commission to a so-called COREPER meeting to review the deal announced today. This meeting was originally planned for today, but has now been rescheduled, likely to take place over the Christmas period. It will then be sent for Council evaluation. After signing of the deal it will be published in the Official Journal.
  • The deal will be marked to “provisionally apply” which means the deal is in force without a European Parliament vote. This means despite the fact that the EP already has an extraordinary session for ratification of the deal in the calendar for 28 December, it’s now more likely that this will happen via a “consent vote” at the earliest opportunity in 2021.
  • This process would take between a week several (into February) given some of the timings involved with translation of the over 2,000 pages of legal text. Officials refer to a non-legally scrubbed text as a “dirty” text; the 23 “authentic” legally-sound translated texts would all be available in March / April and at that stage would replace the “dirty” English text signed in the coming days.
  • In UK, the House of Commons will be recalled for an approval sitting on 30 December and we expect remote and proxy voting arrangements to be made. The House of Lords are reported to be sitting for a scrutiny period, which would likely place on  31 December.
  • While normally the UK Parliament would ratify treaties through the provisions of the Constitutional Reform and Governance Act 2010 (CRAG), this would have required laying the deal in both Houses in November to comply with the 21-day period provided for a treaty to sufficiently scrutinised.
  • In this case to allow the deal to come into force before year end the CRAG has been disapplied by laying a Bill implementing the UK-EU Treaty. A 50-page skeleton “Draft Future Relationship Bill” was drafted in the autumn to which the details of the deal will now be added. This will need to be passed by both Houses at speed to achieve Royal Assent on 31 December 2020. A similar arrangement was reached for the UK-EU Withdrawal Agreement in January 2020 (section 32 of the EU (Withdrawal Agreement) Act 2020).