EU lawmakers threatened on Friday (11 September) to veto any trade deal with the UK unless Boris Johnson’s government withdraws its plans to tear up parts of its Withdrawal Agreement with the bloc, as negotiations on a future trade deal teetered on the brink of collapse.
In a statement, the leaders of the Parliament’s main political groups warned that “should the UK authorities breach – or threaten to breach – the Withdrawal Agreement, through the United Kingdom Internal Market Bill in its current form or in any other way, the European Parliament will, under no circumstances, ratify any agreement between the EU and the UK.”
The MEPs added that they were “disappointed with the continued lack of reciprocal engagement from the UK side on fundamental EU principles and interests.”
Although the talks with the UK are conducted solely by the European Commission, the European Parliament must give its approval for a deal to be ratified.
The row over the Internal Market Bill, designed to govern trade within the UK, has dramatically increased the chances of a ‘no deal’ scenario under which EU-UK trade would from January 2021 be conducted on World Trade Organisation terms, involving hefty tariffs and quotas on a wide range of goods and services.
On Thursday, UK Cabinet Office minister Michael Gove told European Commission Vice-President Maroš Šefčovič that the Internal Market Bill, which ministers have admitted breaks the Withdrawal Agreement, would not be withdrawn.
In response, the Commission threatened to take legal action against the UK if it breaches the treaty which took the UK out of the bloc in January.
In a Zoom call with around 250 Conservative MPs on Friday evening, at which the prime minister did not take questions, Johnson urged his party to back the bill which he described as “absolutely vital” to “prevent a foreign or international body from having the power to break up our country”.
Although a group of between 20 and 30 Tory MPs, including former Prime Minister Theresa May, have strongly criticised the idea of breaking international law, the bill is still likely to pass through the House of Commons.
However, former Conservative party leader and Brexit campaigner, Michael Howard, told UK media that he did not expect the bill to be passed by the House of Lords, which has the power to delay legislation by one year, and where the government does not have a majority.
The 54-page bill, which will be debated in the House of Commons on Monday (14 September), would give UK ministers powers to modify or “disapply” rules relating to the movement of goods that will come into force from 1 January, when the UK leaves the EU’s single market, if a successor trade agreement is not reached. It would also overturn state aid rules in Northern Ireland.
That would breach the Irish Protocol in the Withdrawal Agreement which took the UK out of the EU in January and requires the UK to keep to the EU’s customs code in Northern Ireland to ensure that there is no return to a hard border between Northern Ireland and the Republic.
Analysts believe Johnson hoped that the bill would push the EU’s negotiating team led by Michel Barnier to offer further concessions on state aid and fisheries, in a bid to finalise a trade pact that could be signed off at an EU summit in mid-October. However, the furious response from European leaders suggests that it has instead hardened the EU’s resolve and support for Ireland.
UK negotiators have conceded that this week’s eighth round of talks in London made little progress, complaining that “the EU position cuts across UK sovereignty in a number of important areas, most notably on subsidy control.”
Elsewhere, the UK notched a small victory by finalising a trade deal with Japan, its first since leaving the EU. Although the Japan pact is nearly identical to the EU-Japan trade deal, it gives Japan’s auto manufacturers greater tariff-free access to the UK market and increases the UK’s access to Japan’s markets in tech and food and drink.
[Edited by Zoran Radosavljevic]