UK Transport and Brexit News & Views No. 58

Mark’s Brexit Week for Transport

I trust that everyone enjoyed their Easter break. Although Brussels remained very quiet over the last couple of weeks, things have nonetheless progressed on the Brexit front. This week has seen alleged disagreement between Olly Robbins and David Davis over the scope of future relationship negotiations, a CBI report calling for regulatory status-quo in the transport sector and Michel Barnier calling for a future UK-EU FTA to legally bind the UK to EU regulations. In short, a regular Brexit week where somewhere in the chaos there seems to be progress being made. In the words of Alex Stubb, Former Finish Prime Minister and current Vice-President of the European Investment Bank, ‘usually in the EU you have three phases- crisis, chaos and sub-optimal solution’. Although we are in the chaos phase, we should not let the frantic nature of the negotiations overshadow the attempts from both sides to seek compromises between their respective stances.

In order to seek compromises, however, there needs to be clarity over where the negotiating parties stand on the issues. That is why we sent David Davis and DExEU a letter requesting such clarity for the transport sector in the form of a ‘Future Partnership Paper’. We believe quite strongly that the EU has thus far set the agenda and terms through its own transparency, and that the UK government could level the field in publishing its objectives for the transport sector.

While we wait for further clarity from the UK government, we will be continuing to meet with key stakeholders and policymakers here in Brussels from both sides of the negotiations. The momentousness of the task ahead should not deter from our efforts to make the best possible Brexit a reality. Don’t let the chaos of the negotiations convince you that Brexit is non-deliverable.

1. CBI backs regulatory status-quo in transport
In a report released by the CBI this week titled ‘Smooth Operations’, the business organisation states that ‘As the UK leaves the EU, there are opportunities for rules changes – for example in agriculture and tourism – and ways of regulating better within current frameworks – such as in procurement for defence and construction. However, these opportunities are limited and are vastly outweighed by the costs that will be incurred if the UK’s rules change so much that it reduces smooth access to the EU’s market’. The CBI report has attracted a lot of attention as it has stated that a ‘bonfire of rules’ would mean more costs than benefits for British businesses. The report suggests that the UK could still influence over important regulatory decisions through continued membership of the many EU agencies – such as the ones governing aerospace and chemicals. The report says that one of the consequences of deviating from rules in any single sector would have unintended knock-on effects on other sectors and that any possible benefits are far outweighed by the costs to British businesses. UKTiE has called for continued regulatory alignment in transport between the EU and the UK and we are believe that we still need to find a way to influence EU regulations once we leave, something the CBI report touches upon. We believe that regulatory alignment from the UK side should be accompanied with formal mechanisms for UK inclusion in regulatory decision-making processes. Would you like to help us maintain momentum in Brussels to achieve the best Brexit for business? Then join us!

2. ICYMI: UKTiE calls for UK to publish Future Partnership Paper for transport
UKTiE has sent a letter to David Davis, Secretary of State for Exiting the European Union. In the letter we have called for DExEU to publish a Future Partnership Paper’ for our industry that is critical to the economy, millions of livelihoods and connects businesses and communities across the UK and Europe. Attached to the letter, we sent DExEU a Brexit Position Paper where our position centered around 4 principles: 1) Access to a skilled workforce for the UK economy, 2) Smooth customs processes, 3) Membership of EU agencies, and 4) A clear transition agreement. UKTiE welcomes the agreed transition and encourages the UK government to publish a Future Partnership Paper for the transport sector to address our three remaining principles. We would  further welcome the creation of a dialogue with the EU and the UK government on the shape of a future transport agreement, reflecting our joint interest in promoting continued close cooperation, for the benefit of UK and European prosperity. As part of our efforts to reach out to all sides of the Brexit debate to make transport a priority, UKTiE met with Gina Miller this week.  What is your business doing to prepare itself for Brexit? Contact us if you would like to know more about the exposure you may face from Brexit supply chain disruptions.

3. Barnier calls for ‘non-regression’ clause in EU-UK trade deal
Speaking this week at the European Parliament, Michel Barnier said that he will insist on a “non-regression clause” in a future trade deal which ties Britain to the bloc’s strict standards after Brexit. Barnier said that the EU would be “extremely vigilant” in policing any attempts by the UK to cut its rules and regulations in a bid to gain a competitive advantage over its neighbours. Barnier was quoted as saying “there will be no ambitions partnership without guarantees on fair competition, social standards, tax dumping and not least environmental standards”. If you would like to help make the case for continued transport alignment, then please join us.

4. This Week in Brussels- UK and EU to officially begin  future trading relationship negotiations?
While things were relatively calm this week in Brussels, next week promises to see the Brexit process return with a bang as Bloomberg report that the UK and the EU will officially begin negotiations on the future post-Brexit trading relationship. This will be the first time that the negotiators sit down to discuss what this relationship will look like and how close it will be. However, the article also claims that these sessions will also include unresolved divorce issues such as the Irish border. This leaves many to wonder whether the sessions will move onto the future relationship, despite the pressing need for clarity on what this future relationship will look like. 

5. Danish PM offers a Brexit warning to Theresa May
Speaking at a joint press conference with Theresa May, Danish Prime Minister Lars Løkke Rasmussen warned the British Prime Minister that Brexit will cause more bureaucracy and has a ‘price tag’. Evoking the consequences of Brexit not just on the UK but also on the EU27, the Danish Prime Minister said that “leaving the single market comes with a price tag. Unfortunately it’s not just a British price tag, there’s also a Danish price tag”. Although a lot of the discussion on Brexit consequences for the EU27 center around Ireland and the Netherlands, one cannot forget that Brexit will cause supply chain disruptions that will be felt throughout the EU27. 

6. UKTiE has also put together the latest timetable for Brexit. We will keep this up to date as the process develops: