UK Transport and Brexit News & Views No. 49

As 2018 gets underway here in Brussels, the political scene is picking up and things are getting into gear once more for Brexit and transport. This will lead to a serious intensification in the negotiations and things will start to move for transport quite quickly. According to the Commission’s timeline, the end of January should see a General Affairs Council which will kick off the official negotiations on a transition deal. This would be followed by the release of guidelines in March 2018 on the future trading relationship, starting the official negotiations on that front as well. What this all means is that we will be seeing simultaneous negotiations across three fronts (1. Legalising the Withdrawal Agreement, 2. Transition, and 3. Future Trading Relationship) leading to the infamous October 2018 deadline referred to by Michel Barnier and Task Force 50.

These are, however, what is in place from the EU’s perspective. As seen for the duration of Phase 1, the two sides are often not on the same page when it comes to the various timings of this process. While the EU has remained politically unified, something which will certainly be tested in the coming months, the UK remains plagued by an unresolved debate over Brexit itself. In order for us to achieve the successful Brexit for transport that we want, something UKTiE has and will continue pushing for this year, these issues need to be overcome.

In particular the UK needs a Brexit plan for transport regarding what it would like to see for the sector in any transition deal. If you would like our analysis on how the things will proceed during Phase 2 of the Brexit negotiations means then please let us know.
 

1. EU ambassadors discuss possibility, and price, of longer transition period to seal trade deal
The Financial Times reports that ambassadors from the EU27 began debating the price for prolonging Britain’s Brexit transition beyond December 2020. During the discussion, Hungary raised the idea of adding an extension clause to avoid the creation of a “cliff edge” — or sudden rupture in ties — should an EU-UK trade deal not be sealed by the end date envisaged for the transition. This suggestion was, however, reportedly rejected by France and Germany. The discussion over the length of the transition is unlikely to end here as some, such as Simon Coveney, the Irish foreign minister, has suggested transition arrangements could last for as long as five years to allow time to prepare for the UK’s complete exit. Do you know what a transition deal means for your business? Contact us to find out more.

2. 20 UK MEPs urge Theresa May to change course and stay in the Single Market and Customs Union
In a letter directed as much at Theresa May as at Jeremy Corbyn, 20 MEPs, including three Tories and a majority of Labour MEPs, have called on to change course and seek full membership of the European single market and customs union. The letter states that “the best way to secure Britain’s prosperity would be to remain close to Europe, inside the single market and customs union, and to secure a deal that keeps Britain in the room”. The group of MEPs also highlighted the supposed irony underpinning the fact that that Britain helped shape the single market but that successive governments have failed to make the argument for its benefits. In response to this letter, a UK Government spokesman said “We respect the position of European leaders that the four freedoms of the single market are indivisible. As the prime minister set out in her Lancaster House speech, we will be leaving the single market and the customs union, taking control of our borders and ending the jurisdiction of the ECJ.”

3. EU issues warning to UK companies over a ‘No Deal’ Brexit
EU regulators have issued a warning to UK companies over the impending ‘third country’ status that the UK will fall into following March 2019. UK companies working in fields from development to aviation and haulage are being warned that the EU will shut down their ability to operate across Europe and block funding streams from Brussels in the event of a “no deal” Brexit. This comes in the midst of the European Commission attempting to communicate directly with UK companies about the damaging consequences of failure to reach an agreement on the terms of withdrawal. In the document from the European Commission, from December 20th, it was stated that “EU contracts and proposals for tender have been modified to include a disclaimer informing companies and NGOs that “if the United Kingdom withdraws from the EU during the grant period without concluding an agreement with the EU ensuring in particular that British applicants continue to be eligible, you will cease to receive EU funding (while continuing, where possible, to participate) or be required to leave the project”. Are you concerned about the potential of a ‘No Deal’ Brexit? Contact us to find out what you can do about it.

4. ICYMI- Informal Network on Brexit Press Release
On December 20th, UKTiE was part of a joint call of businesses who are members of an Informal Brussels Network on Brexit. In the call, we welcomed both the decision by the European Council to move to the second phase of the negotiations and the European Commission’s supplementary negotiating directives. We also announced that the network strongly supports all who are working to achieve a smooth post-Brexit transition and a successful future relationship, and that we are ready to offer input to the UK and EU negotiating teams over the coming months.

5. UKTiE Supported by IDA Group
UKTiE’s work is supported by IDA Group. IDA Group is a highly specialized consultancy for governmental affairs, reputation management, trade and funding. They share the belief in effective dialogue built upon trust and mutual understanding. Their diverse team of experts includes seasoned diplomats, politicians, journalists, lawyers and designers, supported by a global network of trusted partners, can help create measurable impact for your business. You will find more information on IDA Group and what services they can provide you with here.

6. The view from Berlin: Germany to demand that the UK pay for Post-Brexit bank access
Bloomberg report that Germany will demand the UK pay for for the privilege of its financial firms having access to European Union markets after Brexit as Chancellor Angela Merkel’s government maintains a hard-line stance against a bespoke trade deal. This comes as Philip Hammond and David Davis visited Germany this week, pinning a joint article in the German press calling for a trade accord covering financial services.

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

  • 29 March 2017 – A50 triggered.
  • 5 April 2017 – European Parliament adopted Brexit guidelines.
  • 22 May 2017 – Brexit negotiating directives approved by Council.
  • 19 June 2017 –  Negotiations formally began.
  • TBC 2018 – UKTiE  & Norton Rose Fulbright Summit: Customs arrangements after Brexit.
  • End of January 2018– General Affairs Council to kickstart transition agreement negotiations.
  • End of March 2018– Guidelines due to be released for the negotiations on the future trading relationship.
  • 30 September 2018 – Date by which EU’s chief Brexit negotiator, Michel Barnier, wants to conclude the terms of Britain’s exit from the Union.
  • 30 March 2019 – Britain formally exits the EU, following ratification of Brexit by all other member states and the European Parliament.
  • May 2019 – European Parliament election.
Mark Watts
Co-ordinator
UK transport in Europe (UKTiE)
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