I updated my post this morning with the link to the UK published legal text (1,246 pages – it’s the same text in the individual sections and chapters). Look back on the blog itself.
I also updated my post this morning (online) with the link to the EU document now loaded on a dedicated website, this also includes an EU Q&A – here.
A couple of points (identified in the Q&A) –
(1) Trading under ‘FTA’ (free trade agreement) terms from 1st Jan will differ substantively to trading in EU’s Customs Union and Single Market.
In particular:
• rules of origin will apply to goods in order to qualify for preferential trade terms under the agreement;
• all imports will be subject to customs formalities and will need to comply with the rules of the importing party;
• all imports into the EU must meet all EU standards and will be subject to regulatory checks and controls for safety, health and other public policy purposes.
(2) Traders will account not only for the origin of materials used, but also if their processing took place in the territory of one of the Parties. This is called ‘full cumulation’. Exporters will be able to self-certify the origin of the goods, and will have additional flexibility in collecting documentary evidence to prove origin during the first year.
(3) The Parties will recognise each other’s ‘Authorised Economic Operators’ programmes, enabling trusted traders with this status to use certain simplifications and/or facilitations relating to security and safety in their customs operations with the customs authorities of the other Party. But there is no waiver on security and safety declarations, as this requires alignment between the Parties on security standards.
(4) From 1st Jan, the EU and the UK will be two separate regulatory and legal spaces. This means that all products exported from the EU to the UK will need to comply with UK technical regulations and will be subject to any applicable regulatory compliance checks and controls. Similarly, all products imported from the UK to the EU will need to comply with EU technical regulations and will be subject to all applicable regulatory compliance obligations, checks and controls for safety, health and other public policy purposes.
(5) Both Parties agreed on a definition of international standards that identifies the relevant international standard-setting bodies. This is intended to ensure that both sides’ domestic product standards and technical regulations are based on the same international references and are therefore compatible to the extent possible.
(6) In the field of conformity assessment, the Parties agreed to maintain simplified access to each other’s markets through, in particular, the continued use of self-certification of conformity by the manufacturer where this is currently applied in both the EU and the UK. This covers a very large share of bilateral trade.
(7) Re Automotive Products – the Parties agreed that regulatory convergence will be based on the use of the international technical standards set at UNECE (United Nations Economic Commission for Europe) level. Both Parties will accept, in their respective markets, products that are covered by a valid UN type-approval certificate.
(8) Re Medicinal Products – the Parties agreed to recognise the results of inspections carried out by the authorities of the other Party in manufacturing facilities located in the territory of the issuing authority. This will avoid unnecessary duplication of inspections of manufacturers of medicinal products to assess their compliance with Good Manufacturing Practice requirements.
(9) Re Chemicals – the Parties agreed to cooperate, while respecting each Party’s right to regulate, both bilaterally and in relevant international fora, on the assessment of hazards and risks of chemicals and the formats for documenting the results of such assessment. The Parties already implement the UN GHS and this will continue. The Parties agreed to use transparent procedures for the classification of substances and possibly to exchange non-confidential information.
(10) Re Organic Products – the Parties agreed reciprocal recognition of equivalence of the current EU and UK organic legislation and control system, for all categories of organic products. Organic products complying with EU law and certified by control bodies recognised by the EU will be accepted on the UK market and vice-versa. In view of new EU rules for organic products applying as of 1.1.2022, equivalence will be reassessed by end-2023.
(11) Re SPS – there will be no changes to EU food safety standards. UK agri-food exporters will need to meet all EU SPS import requirements and be subject to official controls carried out by Member States’ authorities at Border Control Posts. Where required, these controls will include the verification of health certificates in line with international standards. Similarly, EU agri-food exporters will need to meet all UK SPS import requirements.
The Agreement allows for either party to unilaterally decide to reduce the frequency of certain types of border import controls, taking into account the extent to which their SPS rules converge.
It also ensures a simplified process for the approval of imports, where relevant by drawing up lists of establishments that are eligible to export to the other party, based on guarantees provided by the authorities of the exporting Party.
(12) Re Northern Ireland – the EU acquis, including the Union Customs Code, legislation on goods, sanitary rules for veterinary controls (“SPS rules”), rules on agricultural production/marketing, or VAT and excise in respect of goods, will apply to all goods entering Nortern Ireland.
As a result, from 1 January, goods entering Northern Ireland from Great Britain will constitute “imports”. This means that such goods will need to comply with EU product rules and be subject to checks and controls for safety, health and other public policy purposes, including all necessary SPS controls applicable between the EU and the UK.
An agreement in principle (under the separate Withdrawal Agreement) has been found in the following areas, amongst others: export declarations, the supply of medicines, the supply of certain chilled meats and other food products to supermarkets, and a clarification on the application of State aid under the terms of the Protocol. There are some facilitations –
For example, certain chilled meat, for which imports in the Union market are normally prohibited, will be accepted for delivery to supermarkets in Northern Ireland during a limited period of 6 months:
• Minced meat of poultry, frozen or chilled. Chilled minced meat from animals other than poultry (e.g. minced beef.
• Chilled meat preparations (e.g. sausages, meatballs, pork pies)..
• Any fresh meat, including minced meat and meat preparations, produced from triangular trade (e.g. EU meat exported to Great Britain, cut or minced in Great Britain and re-exported to Northern Ireland).
Another example is that, during a limited period of 3 months, the goods coming from Great Britain and destined for supermarkets located in Northern Ireland will be accompanied with a simplified, collective certificate covering all the goods transported in the same truck, instead of individual certificates.
During this period of time, the UK shall maintain its current EU SPS legislation for the products concerned.
The scope is limited to a restricted number of food suppliers for supermarkets which are approved by the UK authorities after demonstrating that they meet a range of trust criteria. This list of members will be established by the United Kingdom in cooperation with the European Commission before 31 December 2020 and cannot be extended after that date.
(13) Re Business Persons Mobility – the temporary movement of natural persons for business purposes (often refered to as ‘mode 4‘), the EU and the UK have agreed on a broad range of reciprocal commitments facilitating the ability of companies located in a Party to transfer certain employees, as intra-corporate transferees, to work in an associated company located in the other Party. As intra-corporate transferees constitute temporary migration, the maximum duration of such transfers is capped at three years. With respect to UK nationals transferred to the EU, this duration includes periods of mobility between Member States. This is in line with current EU practice with other third countries.
The EU-UK Agreement also facilitates the movement of “contractual service suppliers” or “independent professionals” to supply services under certain conditions. Business visitors not providing services will also be allowed short-term entry in order to carry out certain activities.
(14) Re Legal Services – the EU and its Member States, and the UK will allow lawyers from the other Party to provide legal services relating specifically to the practice of international law and the law of the country where they are authorised under their “home” title.
However, it should be noted that EU law is not considered to be international law, but instead the law of the Member State in which EU lawyers are established or hold their “home title”.
(15) Re Energy – the UK will leave the EU’s internal energy market on 1st Jan, Northern Ireland will maintain the Single Electricity Market with Ireland (Republic of Ireland) (under the separate Withdrawal Agreement). The EU and the UK have agreed to establish a new framework for their future cooperation in the energy field. The UK Energy (Electricity) Guidance was updated on Dec 24th (see the Brexit Guidance List on Cardinal Environment Registers & Checklists).
The UK also leaves the EU ETS (see the Brexit Guidance List) and Euratom.
The UK will define its own climate change targets and policies and the UK committed to implementing a system of carbon pricing as of 1 January 2021. The Parties agreed a framework for cooperation in the fight against climate change, and their ambition to achieve economy-wide climate neutrality by 2050. The Parties will give serious consideration to linking their respective carbon pricing systems in a way that preserves the integrity of these systems and provides for the possibility to increase their effectiveness, for instance by adding further sectors, such as buildings. This would be subject to an agreement to be negotiated separately in the future.
There are also agreed provisions for cooperation in the development of offshore energy, with a focus on the North Sea.
(16) Re Euratom – the Agreement contains a separate agreement between Euratom and the UK on the safe and peaceful uses of nuclear energy.
This Agreement enables:
• the supply and transfer of nuclear material, non-nuclear material, technology and equipment;
• trade and commercial cooperation relating to the nuclear fuel cycle;
• cooperation in the safe management of spent fuel and radioactive waste;
• nuclear safety and radiation protection;
• use of radioisotopes and radiation in agriculture, industry and medicine;
• geological and geophysical exploration;
• development, production, further processing and use of uranium resources.
(17) Re Rebalancing (Level Playing Field, includes OHS and ENV Standards) – the Agreement provides the possibility to apply unilateral rebalancing measures in the case of significant divergences in the areas of labour and social, environment or climate protection, or of subsidy control, where such divergences materially impact trade or investment between the Parties.
This might be relevant, for example in a situation where one Party would significantly increase its levels of protection related to labour or social standards, the environment or climate above the levels of the other Party. This may entail an increase in the costs of production and hence a competitive disadvantage.
Another example would be a situation where one Party would have a system of subsidy control that would systemically fail to prevent the adoption of trade distorting subsidies, which would provide a competitive advantage for that Party.
In such cases, a Party would be able to adopt measures to rebalance the competitive advantage of the other Party.
Each Party could also, at regular intervals and if rebalancing measures have been taken frequently or for more than 12 months, seek a review of the trade and other economic parts of the Agreeent to ensure an appropriate balance between the commitments in the Agreement on a durable basis. In this case, the Parties could negotiate and amend relevant parts of the Agreement. Any trade or economic part of the Agreement, including aviation, that would remain in place or be renegotiated would retain appropriate level playing field commitments.
(18) Re OHS and ENV – the EU and the UK agreed to uphold levels of protection in the areas reated to labour and social standards, and environment and climate.
Labour and social levels of protection cover the following areas:
• fundamental rights at work;
• occupational health and safety standards;
• fair working conditions and employment standards;
• information and consultation rights at company level; or
• restructuring of undertakings.
Environmental levels of protection include the following areas:
• industrial emissions;
• air emissions and air quality;
• nature and biodiversity conservation;
• waste management;
• the protection and preservation of the aquatic environment;
• the protection and preservation of the marine environment;
• the prevention, reduction and elimination of risks to human health or the environment arising from the production, use, release or disposal of chemical substances; or
• the management of impacts on the environment from agricultural or food production, notably through the use of antibiotics and decontaminants.
The climate level of protection applies to:
• emissions and removals of greenhouse gases covering EU’s and the UK’s respective 2030 economy-wide targets including their systems of carbon pricing; and
• the phasing-out of ozone depleting substances.
(19) Re Further OHS and ENV Provisions – the Agreement contains several guarantees in terms of environmental protection, over and above the non-regression provisions applying to environment, climate and labour and social protection. These include:
• A recognition of the shared biosphere;
• Coverage of future targets that are now in the laws of the parties – the 2030 waste recycling targets, the 2027 water targets and the 2030 air pollution ceilings;
• Full inclusion of the key environment principles, including precautionary principle, polluter pays, and integration principle;
• Full inclusion of the principles of the Aarhus Convention with modernised text, including access to justice, access to information and public participation;
• Effective co-operation mechanism foreseen between the supervisory body or bodies in the UK in terms of protection of the environment, and the Commission;
• The recognition of the relevance of procedures for evaluating the likely impact of a proposed activity on the environment, such as an environmental impact assessment or a strategic environmental assessment.
(20) Re Health/Sanitary Quality in Agri/Foods – the broad scope of the commitment on the environment refers to agricultural and food production. In addition, it specifies two important areas for the level playing field with regards to agriculture and food production, namely the use of antibiotics and decontaminants.
(21) Re Aviation – UK carriers will be able to fly across the territory of the EU without landing; make technical stops in the territory of the EU for non-traffic purposes; and carry passengers and/or cargo on any routes between a given point in the UK and a point in the EU. Also, the Agreement will permit Member States and the UK to bilaterally exchange onward travel (termed 5th freedom) rights for extra-EU all-cargo operations only (e.g. Paris-London-New York).
The Agreement defines new arrangements for the recognition of future design and environmental certificates, as well as for production organisation oversight. Existing design certificates issued under EU rules before 1 Jan will remain valid.
(22) Re Road Transport – the Agreement provides for quota-free point-to-point access for operators transporting goods by road between the EU and the UK. This means UK lorries would be able to reach the EU and return from the EU, including when not loaded. The same rights are conferred to EU hauliers travelling from any point in the EU to the UK, and back from the UK to anywhere in the UK.
UK and EU trucks will also be able to perform up to two additional operations in the other party’s territory, once they have crossed the border.
This will allow EU hauliers that carry a load to the UK to perform two cabotage operations in the UK, thus limiting the risk of having to travel back to the EU without a load.
For UK hauliers, these additional operations can be composed of two cross-trade operations (i.e. transport operations between two Member States) or one cross-trade and one “cabotage” operation (i.e. a transport operation within two points of a single Member State). Special provisions are made in the case of Ireland, as Northern Irish hauliers will be able to perform two cabotage operations in Ireland.
ECMT holders will be able to do 3 cabotage operations.
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