I should have anticipated the latest Brexit move by the ever-more-desperate Government, but it still boggles the mind.
Per the Torygraph, the Cabinet has now latched onto the idea of staying in the customs union beyond the transition period will buy the UK the time it needs to set up a techno-fantastical seamless solution on the land border between the Republic of Ireland and Northern Ireland by, say 2023.
One of the things we’ve been saying for a while, and poor Richard North has been saying on virtually a daily basis for weeks, is the pols and pundits fixation on a “customs union” as a Brexit magic sparkle pony is utterly misguided.
Repeat after us: a customs union is only about tariffs. It has absolutely nothing to do with the other elements of being inside an “internal market,” such as needing to verify if goods meet safety standards or other requirements. So being inside a customs union by itself does zero to alleviate the need for a hard border.
On top of that, this idea, even if it did solve the expressed problem, is an administrative nightmare. Customs is already behind in getting a systems upgrade done by January of next year. As of Brexit, it will need to handle a huge number of additional goods it did not have to process before. Even a transition period will not fully solve this problem because the UK will become a “third country” with respect to all sorts of countries where the UK’s former trade relations were via EU treaties. The EU can extend its arrangements with the UK, but it can’t with respect to the UK’s dealings with, say, South Korea. And no, the UK can’t just act as if the EU treaty is in force, since most deals had quotas for certain products and the numbers won’t transition over to a wink and nod bilateral fudge. Anyone who wants to take advantage of the UK’s weak position probably will.
And expecting the customs system to make all sorts of yet to be specified changes by Brexit day….and then change again when the customs union interim deal is over? Good luck with that.
Let us turn the mike over to Richard North, who shellack the customs union insanity du jour longer form in today’s post, Brexit: not even at the starting gate:
The purpose of the current Brexit talks being conducted within the Cabinet are, we are told, mainly concerned with how the UK is to avoid a “hard” border between the Irish Republic and Northern Ireland….
In order to keep the goods flowing, the prime minister – we are told– is ready to tell Brussels that the UK is prepared to stay in the customs union beyond 2021.
By such means, the UK will stay aligned to the customs union, to allow the “highly complex technology needed to operate borders after Brexit” to be procured and installed, processes which are said to take until 2023 to complete.
What is absolutely staggering here – if the report is correct – is the belief that continued membership of the customs union will in any way facilitate the free movement of goods across the Irish border and thereby avoid the need to set up a “hard” border.
This appears to rest on the continued perpetration of error of confusing the “customs union” with “customs cooperation“, two entirely separate concepts which rest for their authority on distinct parts of the Treaty of the European Union (Chapters 1 & 2, respectively, of Title II).
Confirmation that this error is at the heart of this initiative would seem to rest with Telegraphclaiming that remaining in a customs union would keep the whole of the UK within the EU “customs territory” for a temporary period, avoiding Northern Ireland being under a separate regime.
This in itself is a mistake. For a start, the European Union itself is based upon a customs union. That much is written into the treaty, so the only way the UK can remain in thecustoms union is to stay in the EU. In fact, the UK will leave the EU on 29 March 2019 and, in so doing, will leave the customs union.
Thus, what is actually meant is that the UK will adopt all the regulations pertaining to the customs union, but without actually being in it. But this is largely what the UK has said it intended to do through what was originally known as the Great Repeal Bill.
As to the “customs territory”, this is not defined by the customs union, per se. Rather, this is defined by Regulation (EU) No 952/2013 (Article 4) – the Union Customs Code Regulation. As a formally defined area, this embraces much more than just the customs union – it also takes in the internal market….
Thus, for the UK to remain within the customs territory, the EU would have to amend or extend the application of Regulation 952/2013 (and all the related regulations) to ensure continuity of application. But, the UK would no longer be in the EU and therefore outside its jurisdiction. One can only imagine therefore, that the provisions would be carried through in the formal Withdrawal Agreement…
The upshot of all this though is that the best we can get from the application of customs union rules, and the relevant parts of the UCC, is that we will have a tariff-free border, with no rules of origin (ROO). But that in no way ensures free movement of goods. As we know, that only comes with full participation in the Single Market, requiring regulatory alignment and much else.
So in other words, even if the UK were to get what it really needs, which is to stay in the “internal market,” it would be massively complicated to paper up in the Withdrawal Agreement. That makes it a big ask from a negotiating perspective. The UK would therefore need to give up something pretty large to get that, even if the EU were amenable.
And then of course we get to a few other issues like…being in the “internal market” means full regulatory alignment, and that entails accepting the EU administrative oversight apparatus….including submitting to the jurisdiction of the ECJ, something hard Brexiters regard as akin to sleeping with Satan.
And even this supposed solution is still a bridge to nowhere. The EU has repeatedly rejected the idea of technology legerdemain solving the need for a hard border. From everything we can see, the UK has not presented any specific ideas to show that its hocus pocus could ever be designed, let alone implemented. Short of a concrete proposal that looks sound, the Government is acting like a spoiled child who thinks if it keeps repeating the same demand and better yet, whines too, they’ll get so tired of being nagged that they’ll give in.
It looks like the Government is determined to make no progress. I don’t see how they can keep the fantasy going beyond the next European Council meeting in June, and they may have the crack up before then if the EU has the opportunity to again dash more cold water on tired old recycled ideas. In the meantime, the UK public is being done the worst possible disservice by what passes for their elites.