Since subsidy control is at the core of the “tricky” issues, ask these questions, and demand answers, when evaluating the coherence and rationality of the current PM’s position that “there are limits which no sensible independent country could go.”
1. He fought the 2019 election on the basis of a political declaration that promised to “uphold the common high standards applicable in the [EU] ... in the areas of State aid ... [and] to maintain a robust and comprehensive framework for ... state aid control.”
He presumably did not then believe that a commitment to a robust subsidy control regime exceeded “limits [beyond] which no sensible independent country could go”. And nor, presumably, did those who voted for him. What, precisely, has changed?
2. When deciding whether to accept a contract (or treaty) term, the rational questions to ask are (a) “Does this stop me doing something I actually want to do?” and (b) “If so, is it worth refusing the term even if it means I don’t get the other benefits of the contract/treaty?”
In relation to the EU’s proposed terms on subsidy control, what process of evidence-based reasoning has the current government engaged in to answer those questions?
What, exactly, would it like to do that it couldn’t do with a robust subsidy control regime? And are the benefits from whatever that is worth tariffs and the other enormous additional disruption to individual lives and businesses that will flow from no deal?
I have seen no plausible answers to any of those questions from the current government or its various cheerleaders. I do not think that there are any.
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The devil is in the detail. But ultimately the UK choice is whether (a) to accept a deal the benefits of which cld be withdrawn if the EU (after arbitration) later decides that divergence has in fact become too great for those benefits to be in its interests any more; or
(b) to refuse a deal, and those benefits, now (and before we have decided what if any divergence we actually want.
It’s a bit like someone who balks at renting a nice house they rather like because there’s a term in the lease that gives the landlord a right reasonably to refuse them having pets, even if they have no pets and aren’t sure whether they ever will.
Note, however, that as explained here, politico.eu/article/uk-scr…, it was not at all clear in WTO law that the UK could take advantage of the WTO ruling authorising the EU to impose those tariffs.
Nor is it clear that there is domestic law power to impose such tariffs: legislation would have been got through by the end of the year.
That is because Article 12 of the Protocol says this.
The 1st sentence of para 4 tells you, for present purposes, that the Commission has all the powers over the UK in relation to Article 10 as it has over Member States under Articles 107-108 TFEU. Powers to find that aid has been granted under Article 10 and to order repayment.
Another example of the current government’s allergy to democratic and Parliamentary scrutiny. For roll-over agreements like Japan barely justifiable (done at speed and little change). But for the US? CPTPP? These agreements could mean major and controversial changes to policy.
Note, also, that reducing democratic scrutiny to a “dumped on Parliament at the last minute, take it or leave it” approach is bad strategy as well as being unprincipled.
It increases the chance (even with a majority of 80) of rejection if something has been conceded which causes such outrage that even Tory MPs feel forced to oppose.
This is not, in my view, a sensible hill for the current UK government to die on. In practice, ex ante approval will be insisted on *by the recipient* if there is any risk that a regulator can order the reversal of a subsidy after it is granted.
(And if there is to be a regulator that is more than a toothless commentator it must be able to order the reversal of subsidy that distorts more than it helps achieve any public policy objective.)
So winning the absence of a prior clearance requirement should be not an important UK objective, here.
Some comments on the subsidy/State aspects here (this is the clearest and probably, given @tconnellyRTE’s record and deep understanding of the issues, one of the most reliable, accounts of the current state of play).
What seems to have happened is that the EU has agreed that a subsidy need not be cleared first by an independent regulator before it can legally be granted.
That is a key aspect of EU rules - albeit very importantly tempered in practice by block exemptions that automatically approve aid falling within them - in normal years the overwhelming bulk of aid is granted that way.