Brexit & Beyond newsletter

28 May 2024

Welcome to the 28 May 2024 Brexit & Beyond newsletter

The Minister for the Economy made a statement on the North/South Ministerial Council on Trade and Business Development. The Assembly debated and passed a legislative consent motion on the Tobacco and Vapes Bill; some Members questioned its compatibility with provisions in the Windsor Framework. MLAs debated a motion on veterinary medicines. Foreign Secretary Lord Cameron gave evidence to the Commons European Scrutiny Committee. The Lords Windsor Framework Sub-Committee heard the views of three local political parties on ‘strengthening Northern Ireland’s voice in the context of the Windsor Framework’. The Department for the Economy has published research on NI’s post-Brexit regulatory environment.

 

Plenary business

North/South Ministerial Council: Trade and Business Development

On 20 May, the (then) Minister for the Economy Deirdre Hargey made a statement on the North/South Ministerial Council (NSMC), which met in trade and business development sectoral format on 26 April 2024. Junior Minister Pam Cameron and former Economy Minister Conor Murphy represented the Executive. Minister Hargey updated MLAs on discussions on InterTradeIreland and said, “Good work has taken place on looking at the opportunities that dual market access [to the EU and UK] presents. InterTradeIreland and Invest NI continue to work together to look at those opportunities and, importantly, at how we can profile them and alert people to them.”

Hargey said delays to formalising the UK’s association to Horizon Europe has had “a considerable impact on investment in science and research and on all potential all-island economic cooperation.”

Tobacco and Vapes Bill: Legislative Consent Motion

On 21 May, the Assembly debated and passed a legislative consent motion on the Tobacco and Vapes Bill. Diane Dodds asked Minister for Health Robin Swann whether he and his officials considered the applicability of the Bill in Northern Ireland, “given the fact that the Windsor Framework has stopped legislation on Rwanda and on aspects of the Northern Ireland Troubles (Legacy and Reconciliation) Act 2023.” Alan Chambers noted “some dispute about how the Bill sits alongside the Windsor Framework” and said, “On that point, I will follow the advice of the local Departmental Solicitor's Office (DSO), the UK Government's legal teams and the UK Government, all of which are clear that this provides for an age restriction, not a ban.” Jim Allister also raised this issue, noting that the EU Tobacco Products Directive applies in NI and that Ireland is not proceeding with a generational ban on tobacco products because of the directive. The Irish Government states, “Preliminary legal advice suggests Ireland cannot pursue a ‘smokefree generation’ policy as has been suggested in other jurisdictions due to the EU’s Single Market rules and Tobacco Products Directive.”

The Minister for Health said the EU Directive “is concerned with the manufacture, presentation and sale of tobacco and nicotine-containing products. It includes restrictions such as limitations on the nicotine content of e-cigarettes, requirements for the manufacturers to report on ingredients in tobacco products and e-cigarettes, and a requirement for the provision of information to customers, including health warnings on packaging”. He said the matter was considered with the UK Government during the development of the Bill and stated, “We remain unaware of any barriers presented by the Windsor Framework to the measures set out in the Bill being applied in Northern Ireland”. Minister Swann raised the matter with Minister Leadsom who provided “reassurance that the work of her and [his] departmental officials and the legal advice that she has received indicates that that will not be an impediment.” He concluded, “Since this is a UK Government Bill, it will ultimately be for the UK Government to determine whether there are any barriers to our inclusion and to deal with any challenges in relation to that.”

Minister for Health Robin Swann

Minister for Health Robin Swann

Since this Assembly debate, the Prime Minister has called a general election. Leader of the House of Commons Penny Mordaunt, did not include the Tobacco and Vapes Bill in the list of legislation to be passed before Parliament dissolves. The Bill therefore will not receive Royal Assent.  It will be for the next government to decide whether to reintroduce a Bill on this issue.

Debate on veterinary medicines

On 21 May, MLAs debated and agreed a motion on veterinary medicines, acknowledging the “deep concern of the agri-food industry that the number of veterinary products estimated to be at risk in Northern Ireland could be up to 51%”. Under the Windsor Framework, Northern Ireland will have to follow EU rules on veterinary medicines. There is currently a grace period in place, which was extended until the end of 2025, and means supplies from GB to NI are not disrupted. The British Veterinary Association has previously said Northern Ireland could lose access to 51% of the veterinary medicines it currently receives - the requirements under EU rules to send products from GB to NI make it likely that companies would withdraw from the market. More recently, the Lords Sub-Committee on the Windsor Framework heard this number has reduced to an estimated 34-35%, as some supply lines have been rerouted through Ireland.

Tom Elliott (UUP), who proposed the motion, noted the House of Lords Windsor Framework Sub-Committee's inquiry on this issue, which highlighted serious concerns about restrictions on the range of veterinary medicines available to Northern Ireland, and the potential consequences for animal and human health. William Irwin (DUP) noted that medicines that may be at risk after the end of the grace period include the botulism vaccine, saying, “The potential scenario where such medicine would be unavailable is not an outcome that our industry can tolerate, and there is a real sense that the British Government need to fix it.”

 UUP MLA Tom Elliott

UUP MLA Tom Elliott 

Declan McAleer (Sinn Féin) said an EU-UK veterinary agreement would be “helpful, but the British Government are opposed to it…It is vital that the UK Government continue to work with the EU to get a solution on veterinary medicines and ensure that there is no impact on food production or food processing from a lack of access to those medicines.” Eóin Tennyson (Alliance) said the failure to adequately address the issue “has the potential to cause difficulty for animal health, agriculture and our wider economy, owing to additional cost, a reduction in competition and increased bureaucracy...The aspiration must, of course, be a comprehensive UK-EU veterinary medicines agreement.”

Patsy McGlone (SDLP) commented that most of the veterinary medicines at risk of being discontinued for NI are licensed in other EU member states and meet EU standards. He highlighted some potential solutions: “a bonded warehouse for storing veterinary medicines in transit to the North; acceptance by the EU of quality testing in warehouses in Britain and of the current market authorisation holder addresses; and the introduction of a grandfather rule to allow for the continuation of the supply of veterinary medicines that were available pre-Brexit.”

Jim Allister (TUV) said, “Our traditional path for accessing medicines is from GB — 85% come from there — and not one of them has inflicted any damage or hurt anywhere in the EU on animals or on health, yet, despite that proven track record of non-damage, the EU belligerently refuses to do the decent thing.”

The Minister of Agriculture, Environment and Rural Affairs Andrew Muir responded to the debate. He said as Minister he currently has no control over this area, “as the movement of veterinary medicines between Great Britain and Northern Ireland is now subject to the direction and control of the Secretary of State, as provided for in regulation 3 of the Windsor Framework (Implementation) Regulations 2024.” He participates in meetings of the Windsor Framework veterinary medicines working group, which has met twice to-date. A third meeting is scheduled for 5 June. Minister Muir stated, “Decisions are, ultimately, for the UK Government and European Commission to agree on. The solution to this situation must respect the international treaties that have been agreed between the UK and EU, and unilateral actions should not be an option. The recommendation to introduce legislation to prevent regulatory divergence between Great Britain and Northern Ireland would leave Northern Ireland outside the EU regulatory regime. The impact would be upon the movement of animals and animal products, risking many more issues than it would solve. I would not support breaching an international agreement.”

Muir told MLAs that the current protocol from the Foreign, Commonwealth and Development Office “massively inhibits” his direct engagement the EU, which is currently through the UK Government. He said, “It would be much more beneficial to have direct engagement with the EU so that we can engage and find solutions on the issue.” Muir stated that a sanitary and phytosanitary (SPS) agreement between the UK and the EU “would not offer a complete solution to the issue, but it would set out measures to ensure food safety and protect the health of animals. It would also reduce a lot of the friction experienced to date.”

 

Lord Cameron gives evidence

Foreign Secretary Lord Cameron appeared before the Commons European Scrutiny Committee on 20 May. Lord Cameron co-chairs the Withdrawal Agreement Joint Committee, and Trade and Cooperation Agreement Partnership Council (read more about these governance structures on our website). The committees met on 16 May 2024. Lord Cameron, referring to recent debates on applicability motions at the Assembly, said the EU and UK talked about “some of the issues where there has been agreement in the Northern Ireland institutions—for instance, the organic pet food regulation—and we discussed areas where there has not been agreement, such as geographical indicators.” He noted that there have been “some problems about not getting information to the [Democratic Scrutiny] Committee quickly enough” and said, “We need to do better on that in future.”

Regarding the implementation of the Windsor Framework, Lord Cameron said, “The basic position between the two sides [the EU and UK] is that they say we are not doing enough to implement the checks and the procedures, and we keep reminding them that it is so important that the devolved institutions are back up and running. We keep explaining the importance of understanding the unique circumstances of Northern Ireland and asking for forbearance and time to put in place things in a way that can make them work.”

Much of the evidence session focused on negotiations on Gibraltar. Lord Cameron explained, “We are trying to safeguard the sovereignty of Gibraltar, but at the same time, we are trying to put in place what the Government of Gibraltar want, which is to have a frictionless border with Spain.”

Chief Minister of Gibraltar Fabian Picardo issued a press release in response to the evidence session, saying members of the Scrutiny Committee “seem to want to turn a Nelsonian blind eye to the huge problems that their Brexit has created for Gibraltar and our current economic model. More worrying, there seemed to be a failure to understand some of the issues that arise and how to legally and logically resolve them. Protecting the people of Gibraltar and fully preserving our sovereignty, jurisdiction and control is about more than just asking provocative questions, it’s about working to bring about deliverable outcomes.”

 

Lords Windsor Framework Sub-Committee

With the announcement of a UK general election on 4 July, the remit of the House of Lords Sub-Committee on the Windsor Framework will come to an end following the dissolution of Parliament on Thursday 30 May. The Committee has written to Minister of State in the Cabinet Office Steve Baker drawing attention to the evidence taken in its inquiry into ‘strengthening Northern Ireland’s voice in the context of the Windsor Framework’.

Last week, the Committee last week heard from three political parties in Northern Ireland. Deputy Leader of the Ulster Unionist Party Robbie Butler said there is a “frustration” among businesses and at the moment, there “doesn’t seem to have been a significant improvement in understanding the complexity, and where the rough points are for various businesses.”

Butler suggested that attendance at meetings of the Joint Committee could be open to any Executive minister, depending on the subject matter. Currently the First and deputy First Minister attend. He expressed concern that the Stormont Brake could have an unintended consequence, and NI could be “misaligned with the GB market and the EU”. He said there have been verbal assurances that that is not the case, but they won’t know until the mechanism is tested. He said there is a lot of pressure on the Democratic Scrutiny Committee, noting the level of detail and compressed timelines that committee members have to manage. He said the committee “isn’t adequately resourced” and “needs to develop that informed expertise”.

Deputy Leader of the Alliance Party Stephen Farry said, “The system isn’t working at present, and probably could have been designed better”. He said NI politicians need to “get in at ground level, have a voice, particularly in Brussels” to highlight issues, and to try and shape new or amended EU legislation which may apply in NI. However, he said the Stormont Brake and applicability motions are “essentially at the end of the [legislative] process”. Farry said if the Stormont Brake is applied, or if an applicability motion is not passed (or not tabled), it’s “unknown territory” and they don’t know how the Government are going to interpret the Windsor Framework (Democratic Scrutiny) Regulations 2024.

Farry said that given the structures and systems relate to an EU-UK agreement, NI politicians are advised to make their views known to the UK Government, who then represent these to the European Commission, rather than directly. He said, “that is, to our mind, a rather elongated process, but also maybe puts in jeopardy the accuracy of our views.”

Leader of the Opposition in the NI Assembly Matthew O’Toole (SDLP) said the new arrangements for democratic scrutiny at the Assembly are “an improvement” but said there is “still a bit of a deficit in terms of the substance of the engagement.” O’Toole suggested that Northern Ireland could have observer status in the EU and said this would reflect NI’s unique set of relationships.

All three witnesses highlighted the importance of pre-legislative engagement. O’Toole said the Framework’s structures lead to “technical information coming at a devolved legislature, with relatively limited means to process and understand what the legislation means, let alone influence it earlier on in the process.”

 

Northern Ireland’s regulatory environment

Professor David Phinnemore and Dr Lisa Claire Whitten of Queen's University Belfast, have carried out research for the Department for the Economy (DfE) on Mapping post EU-Exit regulatory divergence in Northern Ireland. It highlights the complexity of NI’s regulatory environment after Brexit, and aims to assist businesses in navigating the regulatory environment and maximising opportunities provided by dual market access to the EU and UK.

 Post-EU Exit Regulatory Complexity of Northern Ireland

Post-EU Exit Regulatory Complexity of Northern Ireland | Source: QUB report prepared for the NI Department for the Economy

The UK Trade Policy Observatory (UKTPO) has published a research paper on Regulatory Intensity and the EU Single Market: Implications for the UK, examining the product regulatory barriers faced by businesses when exporting to the EU. The research provides a tool to understand the impact of EU product regulation on trade flows. The Department for the Economy has worked with the UKTPO and published a bulletin informed by this research to highlight the extent to which firms in NI could benefit from the unique regulatory context created by the Windsor Framework. It finds there are a “number of sectors where there could be advantages for NI companies, due to a high level of regulation, a strong export presence in the EU market and a relatively low share of purchases coming from GB.”

The Committee for the Economy will consider the research on dual market access at its meeting tomorrow, Wednesday 29 May.

 

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