We can now confidently predict that the UK will leave the EU on 31st January 2020 and enter the transitional period of one year. During which the UK will continue to adhere to current EU rules and standards. So, what the Prime Minister was promising to “get done” during the election campaign was his “oven-ready deal”, where the three main issues of the Withdrawal Agreement – which the EU insisted on settling before it would proceed to the more complicated process of discussing its future trade arrangements with the UK.
These issues include
Time is of the essence
Under the Treaty rules which govern Brexit, the UK could have taken two years to complete its transition out of the Union. However, during the election campaign, Mr Johnson decided to highlight his determination to take a hard line by cutting that period in half. The UK will, he insisted, leave the EU at the end of 2020 and, while he did not quite repeat the well-worn phrase “with or without a deal”, that was implicit in his statement. That possibility is not a year away, as it appears at first glance, but could in fact become a reality within six months. This is because the UK will have to request an extension (should Mr Johnson be tempted to back down from his current position) by the end of June.
The future of trade
The Government plans to introduce a Trade Bill, which will create powers so that the UK can transition trade agreements to which it is currently party as part of its membership of the EU, ensuring continuity for businesses. While at the same time the government want a UK-EU agreement that will mean no tariffs, no quotas and as few checks as possible. It is hard to see how the EU can or will allow the UK to have both without risking a queue of other Member States asking if they too can leave the Union, while continuing to enjoy its many benefits. The UK have very little time to strike a “free trade” agreement with the EU.
What to do next?
There is still the possibility of a no deal Brexit so we continue to encourage our customers to follow the advice we give in our Brexit Readiness Survey (click here to start).
We will continue to keep you informed on Brexit progress and are always available to answer your questions at [email protected]