I am sorry I have to put my poor followers through this. But if similar nonsense is said on #r4today it takes a bit of a correction (thread)
1) First things first: the Withdrawal Agreement. During the transition period we all hope that things will continue as they are now. Including EU FTAs. That is not unlikely, but not guaranteed. Why is it not guaranteed?
2) EU FTAs are treaties between the EU, generally also its member states (they are mixed agreements, all but two of them, soon three, I’ll spare you the details) and a third state.
3) The transition period roughly says: the UK is out of the EU. But for the transition period everything is as before, so third states: please pretend the UK is still in the EU (the UK asked for the EU to convey this to third states, that’s at least my understanding of a footnote
4) Now let’s say there’s no withdrawal agreement. Or the transition period ends. Will the EU FTAs automatically become UK FTAs? That’s not even technically possible. Why not?
5) FTAs contain a whole lot of rules. Some of these are tailor-made to the parties. Famous example: rules of origin. Every FTA has to define which goods benefit from the FTA.
6) These definitions are complex, product-specific and kill the soul of every trade negotiator. Quite often they say something like “55% of the content of [e.g. a car] has to be EU / South Korea content for the product to benefit from the EU-SK FTA”
7) You cannot just automatically “roll that over”. Do you just substitute UK for EU? (Note: in many cases that means the UK industry does not profit from the FTA at all because UK content is too low). Do you keep EU? (Which means the EU27 benefit from UK FTAs)
8) For an EU FTA to become a UK one, changes have to be made to the FTA. And that means: the third country and the UK negotiate. And that means: the third country and the UK have to ratify any FTA according to their domestic rules. And that can mean: parliaments get involved.
9) And I did not yet mention the EU FTAs that according to the Trade Bill impact assessment by the UK government create most of the trade for the UK: EEA, Turkey, Switzerland.
10) The question here is: does the government even WANT these to be rolled over? The EEA is a single market approach. Turkey has a customs union with the EU. The government has said again and again it doesn’t want that. So to “roll these over” identically is not what the UK want
11) Switzerland is a topic for itself. A long time ago @CoppetainPU posted the 28 odd pages of agreements in place between the EU and Switzerland. Maybe my memory dramatises and it was just 5 pages. But the thing is: lots of agreements. Lots of them.
@CoppetainPU 12) Including fantastic things as a set of bilaterals including free movement and linked by a guillautine clause. So, you say, that’s easy: we can kick those things out, the Swiss are not to keen on ‘em either?
@CoppetainPU 13) What you are saying is: let’s change these agreements. Indeed. But that means precisely what I am banging on about: the process is negotiate and then for the Swiss whatever their constitution says about ratifying treaties. Referenda? Who knows.
@CoppetainPU 14) If you are interested in reading my more dignified confusion about rolling over these FTAs that create roughly half of UK Trade under EU FTAs, here’s my written submissions to the Commons publications.parliament.uk/pa/cm201719/cm…
@CoppetainPU 15) By the way: the government is fully aware of that and acting on it, too. Liam Fox has rightly stated that the agreement with Canada (CETA) might be changed to include other stuff, e.g. on digital. So changes are coming.
@CoppetainPU 16) But just like we will propose changes, our partners will, too. Trade is not a one-way street. It is more like a long, winding road. Apparently with lots of people standing on the side yelling strange things at you.
