The post-Brexit agreement is there: the most absurd EU claims are dropped, but Paris is furious
The EU seems to have decided to go back to earth, for the commercial interests of most of the member states and Berlin's last-minute pragmatism: no one wants to die for the Single Market. But Paris is furious and closes the border: do it out of frustration, or can Macron still block everything? The EU would obtain an anomalous trade agreement (state aid and level playing field), but not the tools it would need (European law and European Court) to prevent London from defending itself, perhaps even turning it against the Union. The upcoming agreement would offer a reference framework for a permanent negotiation process between the EU and the UK. But between equals, obeying different laws and courts and without either side having the upper hand from the beginning. Which would do justice to Johnson's resolve and Brexit
The UK is negotiating a trade treaty with the European Union. Intended to regulate relations after the definitive exit of the first from the second. To orient yourself, you need to have a minimum of nomenclature. (A) In international trade there are tariff barriers, duties, and there are non-tariff barriers, including quantitative restrictions: both are excluded from ongoing negotiations: the agreement will be 'zero tariff, zero quota' . (B) There are also other non-tariff barriers, in the form of special rules, made in such a way that foreign competitors struggle to respect them: they can include product standards (such as compliance with certain hygiene characteristics), or production standards ( such as compliance with certain environmental or labor protection laws). These standards are particularly pervasive in the European single market as Member States have to comply with both product and production standards. On the contrary, the other non-member States must only respect product standards: they can sell goods even if manufactured by child workers, in unsafe and polluting warehouses; the exceptions are sporadic, such as the commitment to respect some objective on the 'climate' (EU-Mercosur agreement) or on work (EU-Korea agreement). (C) Then there is the issue of state aid, under the title of 'unfair competition'. In the European single market, the Commission has the power to control state aid to companies even before the money is distributed. On the contrary, non-member states undertake only to avoid particularly distorting aid (as seen in the two cross arbitrations, against Boing and Airbus ). (D) In the event of a dispute, Member States and private individuals in the European single market turn to the European Court of Justice, which decides on the basis of Union law. In contrast, every normal commercial agreement has an arbitration clause: a third party decides according to the provisions of the commercial treaty, so that one party does not have to depend on the courts or the law of the other party.
As the reader can see, single market trade is a far cry from normal international trade. Now, in the new commercial agreement with the Kingdom, the Union claimed to maintain all the existing protections: both product and production standards, discipline against state aid, that the changing European law applied to all these and that disputes were resolved before the European Court of Justice. By opposing a firm denial to the Kingdom which, on the contrary, had a normal commercial agreement in mind: with product standards but without production standards, without commitments on state aid and with an arbitration clause; at the most by allowing the two parties to undertake not to reduce the product standards in place as of 1 January 2021, but without commitments regarding future adjustment ( “non-regression clause” ).
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Accepting the conditions of the Union would have meant, for the Kingdom, to be reduced to the status of a trading colony, like Norway.
Of course, this harsh reality was and still is justified with fanciful arguments. Writes a poisoned opponent of Brexit, Martin Sandbu, that the EU wants to prevent foreign companies from circumventing "the rules for governing the way a population has democratically decided to live", "the rules that express democratic preferences on how workers should be treated, if producers can pollute or how states subsidize companies ”… but it is only the 'European population' who are concerned: what if the British think differently? Also, when did the Chinese ever express their 'democratic preference' ?! A little less stupidly, the Dutch Prime Minister resorts to arguments allegedly technical-practical: "it is not about sovereignty or being free, we are all free, it is about the practical aspects of the single market" … but the 'practical' aspects are resolved from product standards: what does it matter to me, an Italian consumer, if the chimney of this English factory does not use all the filters that its Italian competitor must use? Especially when I am sure that the Chinese competitor of both factories does not use any filters ?!
On the other hand, it is well known that not all countries can afford the same production standards … indeed, it is by polluting and exploiting labor and massively favoring public or semi-public enterprises that underdeveloped countries have become industrial powers, not last is Italy: there is no one who does not see that imposing the same production standards on Romania as Germany is only a way to delay the development of Romanian capitalism … which certainly cannot invest the sums necessary to build a a state-of-the-art establishment as if it were in Stuttgart… while he would be able to buy a used one in Stuttgart, except to reserve the right to bring it to perfection, once the entrepreneurial success had subsequently smiled enough on him. What about state aid, which is always strictly prohibited except when Germany is also in difficulty: just think of what happened this year, when the Union suspended its rules on state aid. In short, the claim put forward by Brussels does not at all aim at "fair competition", about which Von der Leyen babbles … but at the perpetuation of the advantage of Germany and the more advanced Member States. This is what pro-Europeans refer to as "the integrity of the single market".
Of course, Britain is not Romania, nor is it an underdeveloped country, but it must recover a huge loss of manufacturing power, well reflected in its gigantic trade deficit: what would be far more difficult internally, rather than externally. of the law written by German companies and nominally called 'European'. Certainly, access to the single market allowed Great Britain to partially refinance this disproportionate trade deficit with a significant surplus in financial services: the single market has, in fact, this particularity. But with some unpleasant effects, such as creating ever greater differences between London (which these financial services produce) and the rest of the Kingdom. It is no coincidence that Britain has refused to submit to the yoke of the law and the European Court.
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The Union gave up its first stellar claim in July 2020, replacing it with a second one. As for state aid, that European law was transposed into British law ( "dynamic alignment" ), including the establishment of a state aid authority identical to that of Brussels, and that EU private individuals were allowed to appeal before the courts of the Kingdom. As for production standards, the Union proposed that disputes be resolved by a mixed commission and, pending its (unlikely) ruling, that the Union had the right to autonomously adopt 'provisional' measures, through: first a "ratchet clause" (if both parties raise their standards together, they will also accept not to cut them in the future), then an "evolution clause" (when one of the two parties wanted to tighten their own legislation, they would proactively consult the other and, in the absence of agreement, imposed duties), finally an "evolution mechanism" (when one of the two parties had softened its own legislation, the other would reactively imposed duties, without having to bring evidence of the damage suffered).
Things were at this point at the European Council of 10-11 December , when Brexit talked about "8 minutes", the positions remained "distant" for Von der Leyen, the "wide" gap according to Rutte who also marked "we must be firm ". Merkel chanted: "the real big question in which we need a satisfactory answer" is "to understand how each party will react when the laws change, in the EU or in the United Kingdom" … that is, when the Kingdom is removed from the law of the Union ; and his answer was “we need a level playing field, not only for today, but also for tomorrow and the day after”… that is, there must be the same laws… that is, the Kingdom must mimic the laws of the Union.
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A few days and the Westminster Parliament was asked to be available for Christmas. What happened? Well, it seems that the EU has finally decided to go down to earth: it would admit that the party that feels damaged by the state aid granted by the other side, would feel satisfied by granting its own; it would no longer ask the Kingdom to follow its own future evolutions on production standards; it would also postpone the assessment of a future relevant divergence, on both issues, to arbitration. To be resolved, essentially, only the level of documentation necessary to trigger the arbitration would remain. Those in Westminster who have renamed these new conditions as "freedom clause" , do not seem to be completely wrong.
Of course, the Union would have obtained an anomalous trade agreement (state aid and level playing field ), but not the tools it would have needed (European law and European Court) to prevent the Kingdom from defending itself, perhaps even by reversing the agreement. against the Union. In Germany they are realistic and the Süddeutsche Zeitung already foresees that the Kingdom would be the first to use the agreement, denouncing the Recovery Fund as distorting competition. But the same could be done with regard to standards. With the result of earning precious exchange currencies which, if he had to obey or mimic European laws and even more so if he had to obey the European Court rather than an arbitration, he would not have earned.
The same can be said of the parallel negotiation on fishing rights: it is important for France and Denmark who fish in British waters above all, while it is indifferent to Berlin, so that London was able to avoid granting long-term commitments, guaranteeing itself an additional currency. of exchange for the future. What has angered Paris these days when (in spite of the different attitudes of the Union and several other Member States) it blocked all traffic (passengers and even goods) across the Channel (where about 90 percent of traffic between the Kingdom and the Union), with the excuse of a certain variant of Covid , which has been known for months; while London enjoyed teasing her, for example by ordering ships in Her Majesty's Navy to get ready to hunt down French fishermen.
Another particular case is that of little Ireland which, in the 2019 withdrawal agreement, obtained that the northern part of the island remains in the EU customs union, that is, that a customs border, guarded in the presence of EU customs officers, separate from the rest of the Kingdom. Indeed, London had tried to renounce that commitment but ultimately gave up. It remains to be seen what advantage the remaining Member States, other than the Republic of Ireland, have ever gained: the answer is 'none'. Thus, it may well be thought that, at the first opportunity, the EU exchanges this 'victory' for other advantages, for example greater fishing rights in British waters. And we wouldn't talk about it anymore.
The background is the commercial interests of the mass of Member States, who are generally unwilling to die for the single market. Brussels, today, is forced to promise them, in the event of a 'no deal' , to "bring the Kingdom back to the negotiating table as soon as possible". Tomorrow he will spend his time exchanging a looser law on work for a little fish.
In short, the upcoming agreement would not offer a description of the universe, but a reference framework, within which the Union and the Kingdom will carry out a permanent negotiation process, between two parties who obey different laws and courts and without any both sides have the upper hand from the beginning. This does justice to the determination shown by London in pursuing it, in particular by giving up asking for an extension of the negotiations beyond 31 December 2020, by not insisting on a deal on financial services and always repeating to be ready for the no deal .
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The first fruits of the possible agreement are seen in the richest of the Union's commercial colonies, Norway. Here, the party destined to take more votes in the next general elections in September 2021 (the Agrarian Party or Vedum ) is proposing to reduce the country's contribution to the functioning of the single market (about 2.7 billion euros) and wants to "discuss the alternatives ". Of course, the government in office replies that it would be madness … but who knows if it will be able to say it anymore, after the trade agreement that the Union will conclude with Great Britain? Once this is done, we Italians may ask ourselves: if a country with a currency of its own judges it wise to free itself from the game of the law and the European Court … what should we who do not even have our own currency do: accept forever the perpetuation of the double advantage of Germany and the more advanced Member States? Or, move away from the single currency, limiting their advantage to the single market only? Or again, by acting like Britain, denying them both advantages? Here are the questions to which the commercial treaty between the Kingdom and the Union will answer.
The post The post-Brexit agreement exists: the most absurd EU claims fall, but Paris is furious appeared first on Atlantico Quotidiano .
This is a machine translation from Italian language of a post published on Atlantico Quotidiano at the URL http://www.atlanticoquotidiano.it/quotidiano/laccordo-post-brexit-ce-cadono-le-pretese-ue-piu-assurde-ma-parigi-e-furibonda/ on Tue, 22 Dec 2020 05:01:00 +0000.