Brexit

Comment: Brexit and trade deals – UK must respect EU treaties while still in EU

Fjellner Borderlex

If it wants goodwill from friends within the EU in coming Brexit negotiations, the United Kingdom should not try to secure parallel deals with countries the EU is already negotiating trade agreements with, MEP Christofer Fjellner writes.

 

Europe must not throw out the United Kingdom but rather we must let them leave. I have reiterated this ever since the outcome of the referendum held last June where a majority voted for the UK to leave the EU. But in order to guarantee an orderly procedure, the UK must also play by the rules.

 

The Prime Minister of Australia, Tony Abbott, has called for the start of UK-Australian trade negotiations and wishes to have a deal applied the day Britain leaves the EU. This announcement is very strange as the Australian government has already started a scoping exercise for a trade agreement with the UK, through the European Union. I wonder how the Australian government reasons when they try to pursue two trade negotiations with a country at the same time? Will they try to start parallel negotiations with any other EU country, such as Cyprus?

 

I much regret the outcome of the UK referendum but we must let any process take its due course and not let bitterness take over in coming negotiations. There is no need to punish the UK, the coming years will be difficult anyhow. But if the UK decides not to follow the EU treaties that among other, says international trade policy is an exclusive competence of the Union, it will be much harder for European politicians such as myself to call for treating the British respectfully and let the British government and British MEPs retain full rights until Brexit is finalised.

 

Trade arrangements will be a central topic in coming exit negotiations between Britain and the EU. It is up to the UK to decide what arrangement they will try to seek with the EU after leaving and for the EU to push for our interests in these negotiations. But the sort of settlement that Britain secures with the EU will also have implications for its trade relationship with other partners. This was proven by the Japanese Prime Minister Shinzo Abe stressing that the terms of a Brexit agreement will have big effects on Japanese investments in the UK. It is also not only “natural”, as US President Barack Obama has suggested, for Britain to first find a deal with the bloc they are about to leave, it is also necessary, so as to ensure negotiations with other partners are credible.

 

This for two reasons. If the UK will try to seek full access to the EU single market, they will be bound by its rules. If they are bound by these rules, they will not be able to negotiate on certain non-tariff barriers. It should be stressed that this is not a dichotomous choice but rather a floating scale, the closer access to the single market one has, the less regulatory independence to agree on these matters with other trading partners. This has been underlined by trade representatives from Norway and Switzerland, both when they negotiate on their own behalf and through EFTA, they have the freedom to negotiate tariffs and quotas but that there is little space to negotiate about other barriers.

 

Furthermore, the EU, Britain and all other WTO members must agree on the terms of the UK’s WTO membership. Whatever Britain decides to undertake towards the WTO in terms of bound tariffs and quotas but also other commitments as within services in the GATS agreement will form the platform for any bilateral or regional negotiations. The majority of these WTO commitments will probably be easy to negotiate, but certain issues such a quotas for agricultural products can be difficult to solve. I must also stress that if there is anything we know from multilateral negotiations, it is the fact that it takes a lot of time and effort for 164 countries to agree.

 

Christofer Fjellner is a Swedish MEP (EPP) and member of the European Parliament’s trade committee.

 

2 Comments

  1. 1. Tony Abbott is no longer the Australian PM. It is irrelevant what he says.
    2. How does negotiating an agreement that comes into force after the UK leaves the EU jeopardise the attainment of the Union’s objectives’ (Art 4(3)(3) TEU)?
    3. WTO Members have the right to modify or withdraw concessions, let alone reiterate or improve them. Other WTO members can retaliate if they suffer damage (Art XXVIII GATT) or request a panel. But if they do not suffer damage they have no recourse. Nowhere does WTO law require all WTO members to agree on the UK’s schedules. Of course, this does not mean that agreement might not be a better (voluntary) option.

  2. Freeborn John

    The article is rubbish. The EU – Australia trade agreement will never apply to EU – UK trade. This article is simply argueing for a disruptive gap in U.K. Trade relationships post brexit which would harm the British economy. The UK is perfectly entitled to agree heads-of-terms for future trade agreements at this stage, with the intent that these agreements come into force the day after the UK leaves the EU.

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