Barnier and Sánchez discuss top priorities in post-Brexit era

Spain and the United Kingdom have signed an international agreement on taxation, protection of financial interests and the fight against fraud and tax evasion related to Gibraltar. [EPA/FERNANDO VILLAR]

Spanish Prime Minister Pedro Sánchez and the EU’s chief Brexit negotiator, Michel Barnier, met in Madrid on Thursday (30 January) to discuss the Iberian country’s main priorities after Brexit, among them taxation and Gibraltar-related issues.

Barnier also held meetings with other key members of the Spanish leftist coalition executive (socialists PSOE and leftist Podemos), as well as with Spain’s Economy Minister, Nadia Calviño, Foreign Affairs Minister, Arancha González, and Secretary of State for the EU, Luis Marco Aguiriano, official sources told EFE.

With Aguiriano, Barnier discussed the agreement between Spain and the UK on taxation, protection of financial interests and the fight against fraud and tax evasion related to Gibraltar, among other things.

The ‘three zeros’ formula?

On Tuesday (28 January), the UK informed the EU’s General Affairs Council that it had fulfilled all the formal regulatory requirements of UK’s withdrawal agreement, so as to ensure a smooth implementation of Brexit as of midnight tonight (31 January).

Sources from the Spanish ministry of foreign affairs told EFE on Thursday that the EU is looking for “the three zeros: zero rates, zero fees or zero dumpings”, which would translate into very demanding “conditions to avoid unfair competition” between Spain and the UK, the sources stressed.

Besides the politically sensitive issue of Gibraltar – formally a British Overseas Territory, claimed by Spain – other key issues discussed by Barnier in Madrid included international security, internal security, police cooperation, commercial relations, fishing, agriculture, transport, and borders, which are all “vital and important issues” for the Iberian country, the sources told EFE

After a tour of the European capitals, Barnier is expected to submit on Monday (3 February), a document draft with the main negotiation guidelines, which must be ratified on 25 February in the EU’s General Affairs Council.

Four memoranda on sensitive Spain-Gibraltar relations

Four memoranda have been negotiated and signed so far by Spain and the United Kingdom, which detail how the process of the future relationship between Spain and Gibraltar will unfold, particularly regarding conflictive matters.

The former Spanish foreign minister, and currently the EU’s chief diplomat, Josep Borrell, said these agreements laid the ground for a more “loyal, open and balanced” relationship between Spain and Gibraltar and – in no case, he stressed – meant the waiver of any of Spain’s main political claims: particularly the Spanish sovereignty over Gibraltar.

“Spain has negotiated with pragmatism, realism and very concrete proposals, agreements that pave the way for establishing the necessary confidence so that everything can be negotiated in the future,” Borrell then said.

He explicitly mentioned the rights of citizens, in particular, the approximately 14,700 cross-border workers, of whom 9,300 are Spaniards who live in the so-called “Campo de Gibraltar”  (in the municipal area of Cádiz, Andalusia), and work in the British colony.

Agreement on taxation

In addition to the four specific memoranda, Spain and the United Kingdom signed an international agreement on taxation, protection of financial interests and the fight against fraud and tax evasion related to Gibraltar.

All these agreements aim to mitigate the negative impact of Brexit, in particular for cross-border workers and the thousands of ‘Gibraltarians’ who have their main residence in Spain, in addition to the more than 7,000 cars and 350 trucks that cross the border daily.

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