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Brexit and The Protocol
There has been an abundance of dialogue in the media recently about Article 16, and the UK’s threat to trigger it. Before I dive into Article 16, and the significance it has for our island, let me give you a crash course on Brexit and the Northern Ireland protocol.
Unless you have been living under a rock for the last five years, you will have some knowledge of Brexit. In 2016 the UK voted to leave the EU, which came as a shock to the world (and to many people in the UK). The reasoning behind Brexit itself is an article for another day. In the Brexit withdrawal agreement a protocol was established to deal specifically with Northern Ireland. Why? Well, Northern Ireland is not physically attached to the British Isle, whereas it is attached to Ireland (i.e. the EU).
Given the history in Northern Ireland (30 years of conflict i.e. the Troubles), and the resulting Good Friday Agreement, a hard border was not going to be erected on the island between North and South. Thus, an alternative solution had to be included into Brexit, hence the Northern Ireland Protocol.
Basically, the protocol puts a border down the Irish sea, between Britain and the island of Ireland. This has a direct impact on the trade of goods between Britain and Northern Ireland. The EU has certain standards for goods sold in its single market, therefore, goods coming from Britain have to meet these standards. Through Northern Ireland’s connection with Ireland, they can continue to avail of the EU single market. The North are effectively still in the EU when it comes to the trade of goods. Therefore, so is the UK.
To add to this pressing issue, a number of Unionists and Loyalists have a serious issue with this as they strongly identify as British. They feel that it is diminishing Northern Ireland’s British identity. This, coupled with the fact that the catholic population (for the first time ever) is becoming the majority in the North, certainly paints a picture of an imminent united Ireland. A nightmare outcome for the Unionist and Loyalist communities! Oh, yes, and the Unionist DUP party is currently the party holding the most power in the North.
Although Northern Ireland is small in size, it certainly doesn’t hold back on complexities.
What is Article 16?
Article 16 is a clause in the Northern Irish protocol that allows either side to take safeguard measures if the protocol is seen to be causing serious economic, societal or environmental difficulties. If the article is triggered it kickstarts a formal process that allows both sides to engage in talks. The talks would revolve around how to improve the protocol so that it no longer causes economic, societal or environmental difficulties.
What exactly does safeguard mean? Well, the official safeguard measures have not been defined, but they must be appropriate for the damage caused. In all likelihood, in the case of Article 16, it would include a semi-permanent suspension of checks on goods flowing from Britain to Ireland.
Why do the UK Want to Trigger it?
The most obvious question then appears to be: Is the protocol causing difficulties in any of the above mentioned areas of economy, society or environment?
Brexit minister, Lord Frost, is using the disruption of trade (economic) between Britain and Ireland as their excuse to trigger the article. Prime minister, Boris Johnson, has insisted that he wants a solution to post-Brexit issues that are facing Northern Ireland. In his own words:
“But if we do invoke article 16 – which by the way is a perfectly legitimate part of that protocol – we will do so reasonably and appropriately, because we believe it is the only way left to protect the territorial integrity of our country, and meet our obligations to the people of Northern Ireland under the Belfast (Good Friday) Agreement.”
The EU’s fear is that once Article 16 is triggered, and both sides enter into talks, they will inevitably break down. Subsequently, the UK will use this opportunity to drive through domestic legislation to expel the European Court of Justice’s (ECJ) role in the protocol. Britain could not address the ECJ’s role by just triggering Article 16, but it can act as a stepping stone.
What’s the UK’s Issue with the ECJ?
Why would the UK go through all this rigmarole to ultimately remove the ECJ from the protocol?
The ECJ is the EU’s highest legal authority. It decides whether institutions (member states) within the EU are upholding EU law. As a result of Northern Ireland remaining in the EU single market, the ECJ has jurisdiction in Northern Ireland. Thus, if Northern Ireland or Britain were not abiding by EU law (in relation to the trade of goods) the EU would be well within its rights to take the UK to the European Court of Justice. The ECJ could then rule on whether the UK was in breach of its obligations.
OK, I know it is a bit dense, so let me simplify it. The whole point behind Brexit was so that the UK would not be associated with the EU anymore. One of the biggest slogans used around Brexit was “Let’s take back control”. However, the ECJ’s role in the protocol means that the UK can still be sanctioned by the EU, treated the very same as any other EU member state (i.e. not fully ‘Brexited’).
It is worth noting that the UK and the EU both agreed to these terms back in 2017. As an alternative to the ECJ, the UK has stated they would prefer disputes to be managed “collectively and ultimately through international arbitration”. On the other hand, the EU will not accept any part of their single market not being governed by the ECJ.
Main Talking Points
The EU looks at the technical talks around the protocol in terms of three key areas:
- The Movement of Goods Between GB and NI
This is the initial grievance that the UK has. Goods travelling across the Irish Sea are being disrupted, resulting in a shortage of British goods in Northern Ireland. However, the EU has put forward a practical solution to this issue. They proposed an 80% cut on agri-food checks, and a 50% cut on customs formalities. Furthermore, a distinction to be made between goods intended for the South and goods travelling North (It’s a pretty good deal). The UK rejected the offer.
- VAT and Competition Rules
Under the protocol, Northern Ireland follows EU VAT rules for goods, but UK VAT rules for services. This really must be a mess for businesses supplying both goods and services.
This refers to the issue mentioned in the previous section, the ECJ being the governing body on the import and sale of goods in Northern Ireland. London wants Stormont (NI government) and NI stakeholders to gain an enhanced role in the implementation of the protocol. Oddly, Northern Ireland currently doesn’t have much of a say in proceedings.
What are the Consequences?
You are now up to speed on the protocol and Article 16. Yet, the most intriguing question still remains: what will be the consequences if it is triggered?
The dominant narrative around this story is that the triggering of this article would lead to a crisis in EU/UK relations. On Monday 15th November, European Commission Vice President, Marcos Sefcovic, warned of very serious consequences if the article is triggered.
The most drastic threat the EU has warned of is the suspension of the Trade and Cooperation Agreement (TCA). The result of which would be trade war with Britain.
The Trade and Cooperation Agreement
Allow me to briefly explain the TCA. The UK leaving the EU was never going to happen instantly. Both sides relied heavily on each other in multiple areas including economy, society and environment. So, to mitigate the fallout of Brexit, both sides came up with the TCA.
It affords the UK some preferential treatment, ahead of other non-EU members. They can’t fully avail of the benefits other member states are afforded, however, they will not be treated the same as other non-EU members. The TCA consists of:
- Free Trade Agreement
- New Partnership on Citizens Security
- Horizontal agreement on Governance
Anyway, we are getting ahead of ourselves, for more information on the TCA visit here. All you need to know for now is that its suspension could lead to trade war.
If the EU decides to suspend the TCA, tariffs could be placed on UK exports to the EU and vice versa – meaning there will be less goods in overall circulation. This is certainly something that either side (especially the UK) could do without in the run-up to the busy Christmas period.
The trade war would place Ireland in the middle. If checks on goods entering Northern Ireland are suspended, through Article 16, then where will they be checked before entering the Republic? The Irish Border? We’ve already noted why that wouldn’t work (Good Friday Agreement). Or would goods be checked at Dutch and French ports? Dublin also doesn’t look favorably on this option.
Ireland would be hoping both sides can settle the dispute throughout the ongoing talks. After all, the UK is our biggest market for food and drink. Being caught in the middle of a trade war with them would be far from ideal.
The Bottom Line
The UK feels that if the EU retaliates, to them triggering Article 16, by suspending the TCA, it is too harsh. On the other hand, the EU feels there are not sufficient grounds to trigger it in the first place (which there really aren’t), so the UK should be punished for going back on their word.
All in all, it is going to be a matter of who blinks first, and it doesn’t seem like triggering Article 16 would be favourable for the British, or the North’s, people.