Brussels threatens legal action over UK Brexit treaty breach — Financial Times

  • Brussels told the UK on Thursday to immediately scrap its plans to override Britain’s Brexit treaty or face legal action, in a sharp escalation of the two sides’ dispute over the measures. 
  • In a terse statement, the European Commission handed Britain a deadline of the end of September to withdraw its planned internal market bill, warning that the draft legislation was a threat to the Good Friday Agreement and that it had “seriously damaged trust between the EU and the UK”.
  • In a written “legal position”, also published on Thursday, the UK conceded that the bill created powers that could “be exercised in a way that is incompatible with provisions of the withdrawal agreement”. But the legal analysis also stated: “Parliament is sovereign as a matter of domestic law and can pass legislation which is in breach of the UK’s Treaty obligations.”
  • The public statements came as the latest round of trade talks wound up in London and followed an emergency meeting of the joint EU-UK committee that oversees the Brexit deal agreed last year. Brussels called for the meeting after the UK government’s shock decision to break international law by using parliament to override parts of the protocol on Northern Ireland enshrined in the UK’s withdrawal agreement.
  • The commission said Maros Sefcovic, the EU’s lead representative on the joint committee, had laid bare Brussels’ deep concerns about the violation of the Northern Ireland protocol, warning that the future of trade talks with the UK was at stake.  Mr Sefcovic called on the UK government to “withdraw these measures from the draft bill in the shortest time possible and in any case by the end of the month”.  He stated the move had “seriously damaged trust between the EU and the UK”. The commission’s statement added that it was now “up to the UK government to re-establish that trust”.
  • The EU’s rejection of Britain’s stance on the internal market bill has unleashed a storm of criticism over the legislative plans.  On Thursday the former Tory party leader Michael Howard joined former prime ministers John Major and Theresa May in accusing the government of tarnishing Britain’s international reputation, while tensions over the bill led to the resignation of the government’s most senior lawyer on Tuesday. 
  • Brussels dismissed arguments put forward by UK ministers that the plans were a necessary safeguard to preserve the peace process in Northern Ireland should the joint committee be unable to resolve issues on how to apply the protocol. The commission also made it clear that the UK faced legal action if it failed to comply, saying Mr Sefcovic “reminded the UK government that the withdrawal agreement contains a number of mechanisms and legal remedies to address violations of the legal obligations contained in the text — which the European Union will not be shy in using”.
  • An internal EU commission analysis paper, seen by the Financial Times, warns that, even by just putting forward the bill, Britain was “in violation of the good faith obligation” enshrined in its Brexit treaty. The commission paper runs through Brussels’ options for action under the treaty, including hauling the country before the European Court of Justice or launching an arbitration process — either of which could end in fines.

Boris Johnson’s ‘unbelievable’ Brexit withdrawal agreement decision will be defeated in House of Lords, says Lord Heseltine — The Independent

  • Boris Johnson’s attempt to tear up his own Brexit withdrawal agreement is facing certain defeat in the House of Lords, Lord Heseltine has said. The former deputy prime minister was the latest in a string of Conservative grandees to denounce the move, after Sir John Major joined Theresa May in warning that the prime minister risked forfeiting trust in Britain around the globe.
  • The PM’s UK Internal Market Bill, published today, includes plans to allow UK ministers to override the treaty agreement by unilaterally waiving customs documents on goods travelling from Northern Ireland to the British mainland and tariffs on exports travelling the other way and limiting the EU’s ability to curtail their use of state aid subsidies.
  • Irish prime minister Micheal Martin phoned Mr Johnson to “set out in forthright terms his concerns about latest developments in London on Brexit, including the breach of an international treaty, the absence of bilateral engagement and the serious implications for Northern Ireland”.
  • Joe Biden’s chief foreign policy adviser also indicated that the Democratic presidential nominee would not look kindly on anything which disrupted the balance over border arrangements established in the withdrawal agreement.
  • In a further sign of unease in Washington, Nancy Pelosi, the speaker of the US House of Representatives, warned there was “absolutely no chance” of a US-UK trade deal passing Congress if Mr Johnson’s actions damaged the Good Friday Agreement, which she described as “treasured by the American people” and an inspiration to the world.

Export support for small companies cut ahead of Brexit — Financial Times

  • UK business groups have accused the government of cutting support for exporters as the Brexit transition draws to a close by refusing to release grants to help thousands of small companies attend trade shows.
  • Export Partners UK, which represents 41 trade associations. estimates £6m has been allocated for this to the Tradeshow Access Programme (TAP) for the 2020-21 financial year but because most shows have gone online since the coronavirus lockdown, Whitehall has kept the money.
  • The body said in a letter to chancellor Rishi Sunak and international trade secretary Liz Truss they were “deeply concerned at the lack of action”. It urged the ministers to disburse the funds, up to £2,500 per business, to help companies learn how to optimise their use of the online platforms through which many shows are now hosted.
  • Competitors such as Italy, France and Brazil have given extensive support to companies to participate, the group said while some shows have almost no British presence as businesses cut costs. Paul Aiger, chairman of Export Partners UK, said in the letter that the virtual shows were vital to sell new products and meet potential customers. 

UK government asked for clarity on EU data adequacy plans — MLex

  • The UK government has been given until next week to clarify how the EU top court’s ruling on the EU-US Privacy Shield will affect a potential UK-EU data “adequacy” decision after Brexit.
  • In a letter to UK data minister John Whittingdale, European Scrutiny Committee Chair William Cash criticized the UK government for its “astonishing” failure to address the ruling.
  • The committee suggested that the UK government look at “alternative mechanisms for international data transfers,” including standard contractual clauses — model contracts guaranteeing that companies will uphold data-protection rules — and consider the EU ruling’s implications for UK arrangements with the EU after the transition period.
  • Without an EU decision that UK data-protection rules provide “adequate” protection for the bloc’s citizens, EU companies and EU-based affiliates of UK companies will have to find another legal basis for data exports to the UK. The flow of data between the jurisdictions helped drive economic activity worth about 42 billion pounds ($54 billion) in 2018, according to the UK government.
  • The UK contends its data-protection rules meet EU standards and that nothing stands in the way of an adequacy decision. The UK argues its main privacy law, the Data Protection Act 2018, is based on the GDPR; it has a world-class data-protection authority, the Information Commissioners’ Office, or ICO; and it has a robust judicial system that could handle surveillance-abuse complaints.
  • But a landmark EU court ruling in July that annulled a key trans-Atlantic data-transfer mechanism has put the spotlight on a delicate and potentially problematic aspect of the UK’s privacy and security regime: Its intelligence-gathering may be too similar to that of the US, particularly when it comes to mass surveillance of citizens.
  • In July, the EU court annulled the EU-US Privacy Shield, saying it doesn’t provide citizens with protection equivalent to the GDPR when it comes to intelligence-gathering and mass surveillance of citizens.
  • In a letter sent on Sept. 3 and published today, the European Scrutiny Committee asked whether “given EU case law developments,” the data adequacy decision between the UK and the EU could be “realistically” adopted by the end of the transition period on Dec. 31.
  • The committee also sought clarity on what the ruling means for processing EU personal data after the UK becomes a third-country and asked for further guidance from the Information Commissioner’s Office. The watchdog has previously said it was “taking the time to consider carefully what [the ruling] means in practice,” and promised it would provide “practical and pragmatic advice and support” to UK businesses.
Author

Jessica's practice focuses on international trade and anti-bribery work, encompassing customs, export control and sanctions matters. Jessica's trade work includes advising international clients on fast-moving and evolving EU and UN sanctions, notably in respect of Iran and Russia, and on compliance with UK and EU export controls. Her trade experience also includes advising on tariff classification and customs valuations. Jessica's anti-bribery experience includes assisting with investigations, and advising clients on compliance with anti-bribery laws. Jessica has also taken a lead role in monitoring Brexit-related developments; analysing how they will affect the UK's trading position generally, and clients' businesses specifically. She has helped clients begin to conduct risk assessments of how Brexit will impact their businesses, and has assisted them in developing tailored Brexit strategies. Jessica also presents at various seminars, webinars, and conferences on the complexities of Brexit. Jessica advises global clients on complex issues arising from international transactions and works with clients across a number of sectors including pharmaceuticals, defence, finance, aviation, energy, and telecommunications. Jessica has also worked previously in Paris, and is fluent in French.

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