1/ An interesting proposal.
Basically both sides eliminate tariffs, but the UK would reserve the right to fall out of step with EU Level Playing Field rules.
If they did so, the EU would have the right to raise tariffs.
A thread on how negotiators might approach this.
Basically both sides eliminate tariffs, but the UK would reserve the right to fall out of step with EU Level Playing Field rules.
If they did so, the EU would have the right to raise tariffs.
A thread on how negotiators might approach this.
2/ This proposal is different from what you normally see in trade agreements. Ordinarily, FTAs are a bunch of rules everyone agrees to follow.
Dispute settlement, whether at the WTO or in an FTA is there to (theoretically) resolve disagreements about what following rules means.
Dispute settlement, whether at the WTO or in an FTA is there to (theoretically) resolve disagreements about what following rules means.
3/ This proposal is different, in that the UK would not be making a legal commitment to follow EU LPF, only accepting that not doing so would carry consequences.
That's similar in effect, but very different symbolically.
That's similar in effect, but very different symbolically.
4/ For negotiators, there would be a few key questions to resolve. I've listed the ones that jump out at me:
First, how is a UK policy or regulation identified as potentially out of line with LPF?
Does the EU need to monitor all UK measures? Does the UK need to let it?
First, how is a UK policy or regulation identified as potentially out of line with LPF?
Does the EU need to monitor all UK measures? Does the UK need to let it?
5/ Second, who gets to decide if UK really is out of line?
Is the process an internal EU review, as it is for anti-dumping investigations?
Is it a panel of independent or mutually agreed judges, as it is at the WTO?
How will this differ from the FTA's dispute settlement?
Is the process an internal EU review, as it is for anti-dumping investigations?
Is it a panel of independent or mutually agreed judges, as it is at the WTO?
How will this differ from the FTA's dispute settlement?
6/ Third, is the UK's regime measured on a policy by policy, sector by sector, or aggregate basis?
In other words can the UK fiddle around with say its environmental regulatory settings and have one of them dip below the EU level, if put together it's still greener than EU LPF?
In other words can the UK fiddle around with say its environmental regulatory settings and have one of them dip below the EU level, if put together it's still greener than EU LPF?
7/ Fourth, if the UK is found (through whatever means) to have dipped below LPF, who determines what concessions the EU is allowed to withdraw (how high a tariff it can put back)?
Is the EU allowed to unilaterally decide what appropriate balancing means?
Is there a formula?
Is the EU allowed to unilaterally decide what appropriate balancing means?
Is there a formula?
8/ Fifth, does EU "retaliation/rebalancing" have to be confined to the same sector or product?
Can the EU withdraw concessions in agriculture over a subsidy that primarily affects manufacturing?
What about if there's cross-cutting regulatory relaxation, like on labour?
Can the EU withdraw concessions in agriculture over a subsidy that primarily affects manufacturing?
What about if there's cross-cutting regulatory relaxation, like on labour?
9/ Sixth, what happens if the UK later says it's brought its regulations/policies back into line with LPF.
Do the EU tariffs come off automatically?
Is there a panel process to determine if the UK is newly in compliance?
Do the EU tariffs come off automatically?
Is there a panel process to determine if the UK is newly in compliance?
10/ These aren't necessarily insurmountable problems.
For negotiators though, key questions:
UK - How can this be used to unfairly stifle our regulation or lock us out of EU markets?
EU - Will this actually let us protect ourselves from undercutting by UK LPF changes?
/end
For negotiators though, key questions:
UK - How can this be used to unfairly stifle our regulation or lock us out of EU markets?
EU - Will this actually let us protect ourselves from undercutting by UK LPF changes?
/end
