The first round of talks between the UK and EU in Brussels ended in a stand-off over a range of issues, as the UK has been eyeing a Canada-style free trade agreement post-Brexit, while Brussels is resolved to maintain “fair competition” and seeks to ensure a “level playing field”.
UK Minister for the Cabinet Office Michael Gove on Monday confirmed in a written parliamentary answer that Britain would present the full text of a proposal for its trade deal with the EU within the next nine days, ahead of the second round of negotiations between the two sides scheduled in London on 18 March.
Two EU diplomats were cited by the Financial Times as expecting the European Commission to present its own proposal, although without specifying the exact timing, which they suggested was unclear.
In the statement on 9 March, Gove touched upon last week’s talks between the UK and Brussels, saying:
“Discussions in some areas identified a degree of common understanding of the ground that future talks could cover. In other areas, notably fisheries, governance and dispute settlement, and the so-called ‘level playing field’, there were, as expected, significant differences. The next negotiating round will take place on 18-20 March in London. The UK expects to table a number of legal texts, including a draft FTA, beforehand.”
The UK’s Brexit envoy David Frost echoed the message in a tweet.
A supporter of Boris Johnson was quoted by the Financial Times as saying:
“We are producing the text because we are ready to do it. It is not a bespoke trade deal — it is a text based on the precedent of deals the EU has already struck with sovereign third countries.”
‘Digging in their Heels’
Both the UK and EU have “dug in their heels”, as Britain aspires to strike a “Canada-style deal”, making the case that a future relationship between the two sides could be based on “tried and true” elements from previous trade agreements between non-EU countries and Brussels.
Boris Johnson has long made clear that he wants to strike a post-Brexit deal similar to the one the EU has with Canada – the Comprehensive Economic and Trade Agreement, or CETA, that allows for almost tariff-free trade in goods.
If Britain wants a sweeping deal, the EU stresses that it wants a form of regulatory convergence, a close alignment with Brussels regulations, to ensure a “level playing field”.
Downing Street has also cast aside suggestions that Boris Johnson’s determination might be swayed by the coronavirus outbreak, as the Prime Minister has repeatedly ruled out extending the timetable for finalising the trade agreement by the 31 December deadline.
EU diplomats were cited as confirming that Brussels intended for the negotiations to proceed next week as scheduled.
Current developments come as officials from Brussels and Westminster had their first post-Brexit talks in the Belgian capital last week, as they seek to establish a new commercial relationship as well as new security agreements before the end of 2020.
However, four days of talks did little to bridge the divergence between the two parties on what they want their new relationship to look like.
Fisheries, dispute settlement and the Brussels-sought regulatory alignment in areas such as state aid and labour laws have presented particularly tricky hurdles.
“To be completely frank with you … there are many divergences and they are very serious divergences, which is probably quite natural after a first round of negotiations,” Michel Barnier, the EU’s Brexit chief, told reporters.
European Commission president Ursula von der Leyen conceded in Brussels on Monday that bitter disagreements remained between the sides:
“We are aware that there are differences in the approach towards what scope should the future agreement have and what are — if I may say so — the rules of the game everybody has to abide by,” she said.
Emphasising that it was “up to the UK within these negotiations to think about the trade-offs they want to take into account”, the European Commission president added:
“It will be important that the UK kind of makes up its mind — the closer they want to have access to the single market, the more they have to play by the rules that are the rules of the single market.”
The UK left the European Union on 31 January, embarking upon a transition period set to last at least until the end of the year, as the grace period is being used by negotiators to map out a future relationship.