EU-UK Economic Relations: Regulatory Policy and Level Playing Field Discussion

REGULATORY POLICY AND LEVEL PLAYING FIELD FOR EU-UK ECONOMIC RELATIONS Anneli Howard MA BCL Solicitor & Barrister

David Frosts statement 23.7 We have also had constructive discussions on trade in goods and services, and in some of the sectoral agreements, notably on transport, social security cooperation, and participation in EU programmes But considerable gaps remain in the most difficult areas, that is, the so-called level playing field and on fisheries. We have always been clear that our principles in these areas are not simple negotiating positions but expressions of the reality that we will be a fully independent country at the end of the transition period. www.monckton.com +44 (0)20 7405 7211

Pre and Post Brexit Watershed EUWA replicates existing EU-derived rights into statute ss. 1B and 2 Transition watershed - 31 December 2020 : All EU-derived legislation cut and paste and regarded as binding precedent with amends or interpretative glosses Snapshot: All regulations, decisions, tertiary legislation Other carve outs in s.5 and Schedule 1 such as Charter, fundamental principles and supremacy Operative in force and applies before exit day S.6(3) Courts interpret EU provisions on normal construction BUT: Parliament free to modify EUWA or implementing legislation CoA and SC free to depart from prior CJEU rulings www.monckton.com +44 (0)20 7405 7211

Risk of divergence Future EU developments are not retained: Future EU standards and regulations not carried Future CJEU rulings not binding Courts mayhave regard to "anything done by the EU Courts, another EU entity or the EU" so far as relevant (s. 6(2) EUWA). UK Sovereignty and Regulatory Autonomy to devise its own industrial policy going forwards But UK companies remain subject to EU compliance and enforcement, especially competition, consumer, data and environment. www.monckton.com +44 (0)20 7405 7211

Impact of Brexit on UK business reproduced with kind permission from Eversheds Sutherland Preparing for Brexit Report www.monckton.com +44 (0)20 7405 7211

Negotiating the divide.. UK EU Trade in Goods CETA basis zero tariffs, ROs Regulatory autonomy to set UK standards and self-certification No further commitments re high standards FTA for zero tariffs provided UK commits to LPF Customs facilitation and SPS subject to WTO Level Playing Field Reciprocal commitments not to weaken protections re labour, environment, competition, state aid and tax Not subject to dispute resolution No public procurement - WTO Strong legally binding LPF guarantees non regression Continued application of EU current and future rules on state aid, tax, climate change, food Subject to Treaty enforcement mechanism Services Same as other EU FTAs Regulatory cooperation Liberalisation for business and professional services and certain sectors FTA beyond WTO like other FTAs Regulatory cooperation Mutual recognition of qualifications where in EU interest www.monckton.com +44 (0)20 7405 7211

Regulatory and sectoral cooperation UK EU Sectors Separate agreements based on relationship of sovereign equals : Equivalence of financial services Aviation separate agreement Road haulage Energy trading Internal security Unilateral equivalence for different FS activities dependent on close alignment Aviation and Nuclear No audio visual No road haulage benefits UK outside electricity and gas market Cooperation Third country participation in Horizon, Euratom, Erasmus Time limited Fair compensation Framework for UK participation in science, youth, culture and education for fee Judicial cooperation/ Governance Data exchange for law enforcement No mention RBR or civil law matters No role of CJEU Close cooperation as comprehensive security package data exchange, Europol, Eurojust Conditional on ECHR www.monckton.com +44 (0)20 7405 7211

Shifting divergences Not affected unless risk of goods going to EU via Northern Ireland UK only Cross Border sales Goods Imports UK may have different standards but most likely lower Customs checks still likely on NI border and Channel ports Goods Exports While UK keeps to EU standards, minimal risks As UK develops independent trade policy risk of divergence If UK signs FTAs with other countries then conflicting standards and labelling requirements mean multiple production lines May have to check compliance with multiple requirements at once Increased border checks and delays/hold ups Services or Digital Services FTA does not cover services in any detail No pan European coverage or passporting arrangements Need to check necessary authorisations for each Member State May impact receipt of internet services for EU customers Fly in fly out services may no longer be available Cross border Services provided in France to customers from Belgium and Germany may be problematic www.monckton.com +44 (0)20 7405 7211

Thank You Any Questions ANNELI HOWARD ahoward@monckton.com www.monckton.com 9