Some thoughts on the controversy over checks NI-GB and GB-NI as per the Protocol in the WA. These have drawn a lot of heat so I'll try to put them in context:
1/ Whatever about Unionist complaints on the constitutional question, business reps @ManufacturingNI, NI Retail Consortium etc are angry for two reasons: the Irish Sea border will mean paperwork, cost, delays, disruption of supply chains etc...
2/ They were also kept out of the loop by Downing Street in Oct (as was the NI civil service). By contrast, they say both Theresa May and the EU TF50 engaged with them, and her UK-wide customs union resolved a lot of the pain they now potentially face.
3/ “There will be no tariffs, quotas, or checks on rules of origin between Great Britain and Northern Ireland,” said a Whitehall explanatory note of Theresa May's WA in November 2018. To NI business, it removed the problems with the original NI-only backstop
4/ They now believe Boris Johnson abandoned his redlines just to get a deal done by October 31, effectively agreeing to the NI-only arrangement - and they will pay the price
5/ To recap, the revised Protocol ensures no hard border on the island. NI will be de facto operating in the EU’s single market for goods and agrifood, and complying with the EU’s Union Customs Code (even though it is legally in the UK’s customs territory).
6/ Because goods coming in from GB will be able to cross the land border into the EU’s single market then customs procedures, tariffs, regulatory + agrifood checks will be liable at the Northern points of entry: Warrenpoint, Belfast and Larne ports, and at airports.
7/ Goods going in the opposite direction, Northern Ireland to GB, will require summary exit declarations under the EU’s Union Customs Code.
8/ The UK will also, under WTO rules, need to know what is coming in to its territory from the EU (ie Ireland), including goods from countries with which the EU - but not the UK - potentially has a preferential trade agreement. London will have to decide - again more uncertainty
9/ All island trade flows complicate things further: what about the pigs that go north for slaughter and processing? If they are then sold to GB via Dublin they might hit a tariff at Holyhead. What's to stop a bacon trader sending them from Larne to Cairnryan?
10/ On that note, what about hauliers who shift goods from NI to GB but who do it via Dublin, because the Dublin-Holyhead route breaks up the long road journey that he wd have to make from Cairnryan?
11/ These questions are not being answered because Whitehall has been paralysed by #GE2109, by Johnson's promise not to extend the transition, by the drift of experts out of the Cabinet Office, by the speed with which the deal was done, by vagueness over the EU-UK FTA
12/ Hence the leak of the Treasury slides and the DexEU warnings reported by the @FT. As for the Treasury warnings about the hit to NI businesses, a senior EU source says: "all of this is completely accurate and was completely factored in from day one"
13/ Which brings us to the other side of the coin: the mitigations contained in the Protocol. How will they work, and will they stabilise feelings in NI?
14/ The deal essentially outsources all of this to the Joint Committee, to be forged by both sides once the WA is ratified. The JC will have a specialised subcommittee dealing with the Protocol, as well as a Joint Consultative Working Group.
15/ It will set out all goods/categories of goods which will be exempt from tariffs, how the rebate system will work, how the regulatory/SPS checks will work, how intrusive they will be etc. The problem is we don't yet know how the committee will approach this...
16/ The Commission will lead for the EU and has signalled that member states will have strong input. If MS believe waiving tariffs for certain goods or categories of goods over time pose a risk to the single market they could take a hard line, limiting the scope of exemptions
17/ Irish officials, who are also likely to have a key role, dispute this saying that all sides will bring their bona fides to ensure the minimum disruption possible, getting back to the "de-dramatisation" campaign Michel Barnier led in the autumn of 2018
18/ But the work of the Joint Committee will be intimately linked with the parallel FTA negotiations in the sense that Member States will have strong ownership of both. If the FTA talks are going badly the tariff exemptions for NI cd be held up as well - again, more uncertainty
19/ It puts Dublin in an interesting position. How far does it advocate on NI's behalf to ensure that unionism learns to live with the new arrangements, and that business finds the disruptions not as bad as feared? Or how much does Dublin have to cleave to the EU line?
20/ There is concern in MS that the EU, thru the Protocol, is outsourcing the management and operation of a sensitive part of the EU Customs Code, since UK officials (non-EU) will be responsible for checking what is potentially entering the EU single market and customs union
21/ Overall, the picture will also remain frustratingly unclear until the shape of a new FTA emerges. The closer the trade relationship, the higher the alignment with EU rules, the lighter the Irish Sea checks and controls will be. Will the DUP push for a Chequers style FTA?
22/ Once the election result is known this process will start to shift into gear (or stall, depending on the outcome). Brexit and the NI Protocol will not be done. Next year will be dominated by it.
23/ I'll have a long read piece on this on the @rtenews website on Saturday.
