Guidelines for Phase Three of the Brexit negotiations, covering future trade and security arrangements between the UK and the EU, were signed off at a European Council summit held on 23rd March.
Only a few days earlier, a joint press conference held by Michel Barnier and David Davis heralded an agreement on the transition period, during in which the UK will be permitted to sign trade deals with other countries.
So, do these events signal the emergence of the green shoots of a final Brexit deal or is it merely a false dawn?
When Mr Barnier and Mr Davis appeared at their usual podiums in Brussels, the screen behind them displayed the text of the draft withdrawal agreement, including those elements already concluded highlighted in green. Whilst there was a lot of green on show – enough to satisfy both parties that a transition period can begin on 30th March 2019 and end on 31st December 2020 – this will not be set in legal stone until the entire agreement is ratified.
Chief amongst the outstanding issues is that of the Irish border which remains stubbornly unresolved. Supposedly an issue to be wrapped up by the end of Phase One, it is now set to rumble on into Phase Three with June set as the new deadline for agreement on a solution. As things stand, the UK has rejected the EU’s ‘backstop’ proposal that Northern Ireland should remain in the customs union or single market if no other way can be found to avoid a hard border. Meanwhile, the UK’s insistence that a technological solution can be found has met with a sceptical response from the EU. And now, just weeks from the next European Council summit, the UK’s lead civil servant dealing with the issue has left his post to take up another role.
Putting the Irish border issue aside, the confirmation of a transition period is a significant step forward in negotiations and has provided some reassurance to businesses. Furthermore, a more defined blueprint for a possible final deal appears to be emerging, based on a free trade agreement without tariffs and with a mutual guarantee of standards.
However, whilst this may sound acceptable to both sides in theory, stumbling blocks remain, such as the potential exclusion of services from the deal and the possible recourse to origin of goods rules.
Phase Three beckons and, with just 12 months remaining until ‘Brexit Day’, another hurdle has been negotiated…but the race is not yet run.
Article published: 28th March 2018
