On Christmas Eve, the EU and UK signed a trade deal that takes effect from 1 January, but its structure means discussions on EU-UK trade will continue indefinitely, not unlike the relationship the EU has with Switzerland.
The main certainty is that trade will commence without tariffs or quotas on goods traded between the EU and UK, which will be welcomed by Irish farmers.
However, the big issues in operating the deal lie in interpreting how either side is complying with the rules on keeping a level playing field between the EU and UK, especially if the UK diverges from EU standards in future.
The big issues in operating the deal lie in interpreting how either side is complying with the rules on keeping a level playing field
There is a Partnership Council that oversees a Trade Partnership committee, plus 18 specialised trade committees, one of which is on sanitary and phytosanitary standards (SPS).
This highly bureaucratic structure comprises representatives of the EU and UK. It has the authority to amend or modify the deal, provided there is agreement to do so, and also try and resolve areas of dispute before engaging in an arbitration process that has yet to be defined.
A full review of the agreement is to be undertaken every five years.
Hard border with Britain
There is no doubt the specialised trade committees have the potential to move the EU and UK into closer alignment and perhaps in future remove or reduce some of the barriers reintroduced by the UK leaving the customs union and single market. However, as it stands, the deal on Christmas Eve is about as minimalist as it can be when it comes into operation on 1 January. The UK has already indicated that it will phase in checks and inspections over the first six months of 2021, while the EU has indicated that it will put them into operation immediately.
This means Irish exporters may not find delays at British ports immediately, but those using the UK land bridge to France are likely to be delayed at the French end, entering as they are from the UK.
Irish exporters may not find delays at British ports immediately, but those using the UK land bridge to France are likely to be delayed at the French end
The agreement makes provision for each other’s deliveries to pass through, enabling Irish exports to the rest of the EU travel through the UK and Northern Irish exports to Britain travel through Dublin port. There is no mention of “green lanes” or a fast pass for deliveries of perishable goods, though these are matters that might be explored in the special committees.
Unlike fisheries, which has a dedicated chapter in the agreement, agriculture is treated as part of general trade.
Agriculture, however, is excluded from the section on the level playing field, meaning that both the EU and UK can separately decide how they want to support farmers and agriculture with no constraints on how this can be done or how much can be spent.
Northern Ireland trade
Farmers can continue to trade all produces across the Irish border both ways without any restrictions, as Northern Ireland effectively remains part of the single market. They will, however, be subjected to the same checks on imports from Britain as the Republic of Ireland and overall cross-border trade in Ireland will be governed by the special protocol in the withdrawal agreement, not the EU-UK deal agreed on Christmas Eve.
New Zealand has taken issue with the EU and UK deciding to divide the 228,000t sheepmeat quota it had for the EU 28, saying it reduces its market flexibility. Both the EU and UK are separately engaged in trade deal talks with New Zealand, which hasn’t used the full quota in recent years as it has increased sales to China.