Brexit & Beyond Newsletter

5 July 2021

Welcome to the 5 July 2021 newsletter

The grace period for chilled meat products moving GB-NI has been extended for three months. The EU has given a further update on solutions in relation to medicines, guide dogs, and the movement of animals. Junior Ministers gave evidence to the Executive Office Committee, while the Finance Committee heard from experts on the Protocol. Queen’s University has published its latest polling on the Protocol. A legal challenge to the Protocol has been dismissed.

Implementation of the Protocol

Executive Office Committee meetings with EU and UK representatives

Lord Frost will appear before the Committee for the Executive Office on Friday (9 July) at 2pm. His appearance follows the Committee’s evidence session last Monday with European Commission Vice-President Maroš Šefčovič, which we covered in last week’s newsletter. You can watch the session back or read the transcript.

UK Brexit Minister Lord Frost, who will take part in an evidence session at the NI Assembly on Friday | Source: No 10 Downing Street

Grace period extended

On Wednesday 30 June, the EU announced a package of measures on the implementation of the Protocol on Ireland/Northern Ireland. An extension of three months has been agreed between the EU and UK for chilled meats moving GB to NI. This will expire on 30 September 2021. This was choreographed by the EU and UK through an exchange of separate unilateral declarations. European Commission Vice-President Maroš Šefčovič said the EU is “not issuing a blank cheque” and that the extension is subject to strict conditions: the products must “remain under the control of the Northern Ireland competent authorities at all stages of that procedure”, be sold only to end consumers in Northern Ireland, and be packaged and labelled appropriately. The EU’s unilateral declaration notes that “certain adjustments to supply chains have already taken place during the first six months of 2021” and the extension is to allow the adjustment of the supply chains to be completed. The declaration also emphasises that Border Control Posts in Northern Ireland must have “the necessary infrastructure and resources to be able to perform all the controls required by the EU’s Official Controls Regulation”.

The UK issued a unilateral declaration which notes the stipulated conditions for the extension. Regarding labelling for sale only in the UK, it states the UK “will endeavour to introduce product-level labelling as soon as is practicable.” The UK will not amend its own rules on meat products. UK Brexit Minister Lord Frost said the agreement to extend the grace period for chilled meat was “a positive first step” but argues a permanent solution is needed on this matter, which, he says, is “a very clear sign that the Protocol has to be operated in a pragmatic and proportionate way”.

The UK Government says it has submitted a dozen papers to the European Commission on various issues. Šefčovič said he hoped that the UK will “engage constructively on a broader agreement in the area of public, animal and plant health, based on alignment with EU rules” during this three-month period.

Medicines

The Commission states it has found a “creative solution” to ensure continued supply of medicines moving GB-NI. This involves the EU changing its own rules “so that regulatory compliance functions for medicines authorised by the UK for the Northern Ireland market, in accordance with the Protocol, may be located in Great Britain, subject to specific conditions ensuring that the medicines concerned are not further distributed in the EU Internal Market.” The Commission plans to put forward a legislative proposal in the early autumn on this.

Guide dogs

The European Commission has communicated to the UK a solution on guide dogs accompanying people travelling from GB to NI. It states “it is for the Northern Irish competent authorities to now define the details for its implementation on the ground.”

Green card

The Commission has waived the obligation for UK drivers to have a motor insurance Green Card when driving in the EU. NI Minister for Infrastructure Nicola Mallon welcomed this news, saying “I am delighted that…insurance green cards will no longer be required for drivers from Northern Ireland travelling to the South or beyond into other parts of the European Union.”

Movement of animals

The Commission has adopted a regulation in relation to livestock moving GB-NI, to avoid the need for re-tagging animals when they move multiple times. The Commission is working on other solutions for issues in this areas, including the return of livestock to NI from fairs in GB, and risk control of scrapie.

Diverging views

Šefčovič argues that the above solutions put forward by the EU are “an unquestionable response to those in the UK suggesting that the EU is inflexible or too legalistic.” However, writing in the Irish Times on Friday, Lord Frost and Secretary of State for Northern Ireland Brandon Lewis, argue that “To simply say ‘the protocol must be implemented in full’ is to take a theological approach that is frozen in time and does not deal with the reality that now exists.” The UK politicians say that the protocol arrangements “can work only if there is genuine cross-community consent for them” and point to “the inflexible requirement to treat the movement of goods into Northern Ireland as if they were crossing an EU external frontier, with the full panoply of checks and controls.” They contend that “we need to find a way forward, a new balance of arrangements, adapted to the practical reality of what we have seen since January, and based on the common interests we all share.”

Junior Ministers questioned by MLAs

Executive Office junior Ministers Declan Kearney (Sinn Féin) and Gary Middleton (DUP) gave evidence to the Committee for the Executive Office on Wednesday.

Junior Minister Declan Kearney speaking to the Committee | Source: NI Assembly

Kearney gave an update on the recent 9 June meeting of the EU-UK Joint Committee, including the input of the NI representatives at the meeting. Kearney noted a comment from Vice-President Šefčovič who said to Frost at the meeting: “You seem to think we don't take your concerns on board, but your flexibilities are moving targets, constantly moving the issue, and we need assurance that you will work towards compliance." Kearney stated he favours a permanent solution based on an SPS-style agreement.

Deputy Chairperson of the Committee John Stewart (UUP) asked the junior Ministers about full representation, rather than observer status, for NI in the governance arrangements for the future EU-UK relationship. Kearney said this is “a huge democratic deficit” and something they have raised repeatedly. He said it is problematic, and said there has been “a very unyielding and resistant approach in ensuring that our voice is heard”, citing the pre-meeting with David Frost, ahead of the Partnership Council. Frost “advised us and our colleagues from Scotland and Wales who were present that we were present to hear but not to speak and that any expression of our interests would be solely through himself, David Frost, in relation to the Partnership Council. He also made the point that we are really only entitled to attend the Joint Committee. I thought it an unnecessary comment, but he said that we are only entitled to attend the Joint Committee because Ireland, the Southern Irish state, attends and speaks when issues arise.”

There was some discussion in the Committee about the result of the legal challenge to the Protocol. Middleton said that “the very nature of the Northern Ireland protocol creates a barrier in east-west trade. There is an economic border there, and, constitutionally, that creates a problem.” Kearney argued, “You cannot mix up new trading realities that are a direct consequence of the protocol with broader constitutional issues.”

On the EU Settlement Scheme, Middleton said applications can be made after the end of the scheme (which closed on 30 June) if there are reasonable grounds. He said they have been advised that the Home Office will adopt “a compassionate and flexible approach”. NI officials continue to engage with the Home Office on this issue. Martina Anderson (Sinn Féin) asked for an update on common frameworks. Middleton said they have requested this from the Department of Agriculture, Environment and Rural Affairs, but it is his understanding that the Agriculture Minister (Edwin Poots) has sought further legal advice.

Brexit in the plenary       

On Monday, the new Economy Minister Paul Frew (DUP) was asked about the Economy Department’s support for jobs and prosperity, particularly in the context of the trading arrangements under the Protocol. Frew said, “I have seen that, whilst there might be advantages — slight advantages — for some businesses, they are being hampered when they try to buy in stock from GB…the fact that they have to buy stuff from GB penalises them greatly, as does the fact that the paperwork has spiralled out of all control and that they have to employ people just to keep on top of it.”

When asked about building on opportunities from the Protocol, Frew said, “Exports rely on inputs, and many of our businesses, no matter where they sell to, rely on purchases from GB. A key foundation to exporting is first resolving the well-documented issue around trading goods between GB and Northern Ireland…I want to resolve the issues so that we can continue to demonstrate that Northern Ireland is an exceptional place in which to invest and so that we can ensure that our businesses can grow their exports to their key markets, whether those be in the UK, the EU or beyond.”

Finance Committee hears from Protocol experts

On Wednesday, the Committee for Finance heard from experts on the Protocol on Ireland/Northern Ireland. Professor Katy Hayward of Queen's University Belfast outlined the latest results of the poll on the Protocol conducted by QUB and LucidTalk (see below for more details).

 Professor Katy Hayward spoke to the Finance Committee | Source: NI Assembly

 David Henig of the European Centre for International Political Economy said in relation to the 300+ EU regulations the Protocol requires NI to follow, he believes “the UK Government will have carried out a detailed assessment of these and their implications” which they have never shared publically. He agreed with Martin Howe QC that there is an “absolutely clear democratic deficit” and that this was obvious at the time of signing and ratification of the agreement. Howe said the Protocol is “basically flawed”, noting that there is a provision on the customs side for goods ‘not at risk’ which can avoid incurring tariffs – “there is no such let out” for regulations on goods. Dr Anna Jerzewska of Trade and Borders said “there were no easy clear simple solutions here…no off-the-shelf models”, and there was never going to be a solution that satisfies everyone.

On the UK-Australian Free Trade Agreement, Jerzewska said “we're still trying to understand how it's going to work if the UK has an agreement with Australia but the EU doesn't” and how imports to NI will be treated. Henig said there is a strong chance that NI farmers will be some of those who lose out if Australia sends a lot more beef and lamb to Britain. He said the UK Government should be open and honest about what is has signed up to and what the implications are.

Hayward said a “fundamental necessity” before full economic opportunities can be realised, is “the question of stability and certainty”, a request heard often from businesses. Jerzewska pointed to need for clear guidance on how things operate at the moment and how it is very difficult to find information about how things work in practice in NI.

Sam Lowe of the Centre for European Reform suggested that NI exporters potentially have an advantage over Irish-based exporters because the UK rollover trade agreements are, in some cases, more accommodating than the original EU agreements, particularly when it comes to rules of origin and extended accumulation: it might make more sense to export from NI in some cases rather than the EU. Lowe explained how NI’s ability to benefit from UK FTAs agreements is more conditional.

Shanker Singham of Competere Group was asked about mutual enforcement for trading arrangements. He said that the problem he sees is that this “doesn't solve a number of the key problems” for traders: you would still need a customs database, customs processes, and an equivalent of the Trader Support Service.

Poll on the Protocol

Queen’s University Belfast has published its latest poll with LucidTalk on public opinion on the Protocol on Ireland/Northern Ireland. The poll was conducted between 11-14 June 2021. The poll finds an even split on overall opinion on the Protocol: 47% think Protocol is appropriate for managing the effects of Brexit on NI, 47% disagree with this statement. The poll continues to find low levels of trust in actors tasked to manage the Protocol for NI: Only 6% trust the UK Government, 40% trust the EU. Meanwhile, business representatives are trusted by 56%.

Concerns about Brexit and the Protocol | Source: QUB

The democratic consent mechanism – a vote in the NI Assembly on the provisions of the Protocol relating to EU single market law and the movement of goods – will take place before the end of 2024. The poll finds that most respondents say they will vote in the next NI Assembly election (scheduled for 2022) for candidates who share their view on the Protocol.

QUB’s Professor Katy Hayward notes that over 500 people submitted additional comments at the end of the poll, “a sign of quite how exercised people are on the topic”. These comments range from criticism of politicians and political parties, the ‘democratic deficit’, to lack of information on the subject.

Legal challenge to the Protocol dismissed

On Wednesday 30 June an application for judicial review of the Protocol on Ireland/Northern Ireland was dismissed by a Hugh Court judge in Belfast. The case was brought by TUV leader Jim Allister, former MEP Ben Habib and Baroness Kate Hoey, along with other unionist politicians. They argue the Protocol is unlawful because it conflicts with the 1800 Act of Union and the Good Friday/Belfast Agreement. The court said “the making of treaties and the conduct of foreign affairs are matters of high level politics which are unsuited to supervision by a court on a judicial review application.”

The court found that the Withdrawal Agreement Act which gives legal effect to the Withdrawal Agreement and Protocol on Ireland/Northern Ireland does conflict with the Act of Union but that the parts it conflicts with – free trade between GB and NI – are “impliedly repealed” by the 2018 Withdrawal Act. Mr Justice Colton stated that “much constitutional water has passed under the bridge” since the Act of Union. Colton also rejected the contention that the Protocol breaches key provisions of the 1998 Northern Ireland Act and refused judicial review on this ground.

Other news

• The EU Settlement Scheme closed for applications on 30 June 2021. The UK Government’s latest figures show that there were over 6 million applicants, 98,400 from NI.

• The UK Government has published policy papers on the Subsidy Control Bill. The Government says that on exiting the EU, “the UK has the freedom to design a domestic subsidy control regime that reflects our strategic interests and particular national circumstances.” The Bill will provide a framework for a new UK-wide subsidy control regime to allow public authorities to deliver “bespoke subsidies, tailored to their local needs.” Previously the UK followed EU state aid rules. Under Article 10 of the Protocol on Ireland/Northern Ireland, EU state aid law will continue to apply to the UK with regard to Northern Ireland – EU trade. The Bill was introduced to Parliament on 30 June.

This Week at the Assembly

• Monday 5 July, 2pm – Plenary - Question Time – Finance; Health
• Wednesday 7 July, 11am - Committee for the Economy - LCM - Subsidy Control Bill
• Thursday 8 July, 10.05am – Committee for Health - Ministerial Briefing with Mr Robin Swann, Minister of Health; EU Exit legislation
• Wednesday 8 July, 10.05am - Committee for Agriculture, Environment and Rural Affairs - Written Briefing from DAERA on EU Exit legislation; Written Briefing - Common Frameworks
• Friday 9 July, 2pm - Committee for The Executive Office - UK Exit from EU - Briefing on the current and future workings of the Protocol on Ireland/ Northern Ireland with The Rt Hon Lord David Frost CMG

Catch up with the Committees

• Monday 28 June, 12.30pm - Committee for The Executive Office - European Affairs - Evidence session with Maroš Šefčovič, European Commission Vice-President
• Monday 28 June, 2pm – Plenary - Question Time – The Executive Office; Economy
• Wednesday 30 June, 2pm - Committee for The Executive Office - UK Exit from European Union - Oral Briefing from Junior Ministers
• Wednesday 30 June, 2.05pm - Committee for Finance - Oral Evidence - Expert Advice on the NI Protocol: Generalists, and Article 5 - Customs and the movement of goods
• Thursday 1 July, 10am – Committee for Agriculture, Environment and Rural Affairs - Written briefings from DAERA on EU Exit legislation; Written Briefing DAERA - EU Transition Update