The View from Brussels

19 September 2019

Tamlin Vickers, Partner at DRD Partnership, shares the view from Brussels on the outlook of Brexit in the European Union capital.

The leaders of France and Finland have given the UK until the end of September to produce a Brexit proposal in writing, warning that if not, ‘then it’s over’. The use of language is perhaps a little hysterical but it demonstrates the sense of frustration and irritation in among many in Europe with the perceived lack of seriousness of the Johnson government.

Now is an opportune time to reflect on where we have reached on attempts to reach a deal.

The deal?

Notwithstanding repeated British government assurances that progress is being made on a revised deal, the prevailing view in Brussels remains that the chances of a deal before 31 October are next to negligible.

This is due to a combination of factors: time constraints; Westminster parliamentary arithmetic; uncertainty about Johnson’s good faith; and the two sides’ red lines being too far apart. The mood in Brussels was embodied by the rather elaborate performance of the Luxembourg Prime Minister earlier this week. There is real frustration about the UK’s approach, and a view that Johnson is stringing everyone along for domestic political purposes.

However, the mood among more pragmatically-minded people in the Brussels bubble has shifted a little, as details emerge of apparent British movement on some key issues. If you squint hard, an outline of what a revised deal might look like is beginning to take shape.

What about trade?

The UK’s commitment to ‘frictionless trade’ appears to have been quietly dropped, in favour of ‘facilitated trade’, which would require a border of some kind, albeit a soft one. An all-island Sanitary and Phyto-Sanitary (SPS) zone, electricity market and common travel area have all been mooted.

Such an arrangement, while introducing some light trade barriers in the Irish Sea, would be a long way short of a Northern Ireland-only backstop, and as such perhaps would stand a chance of receiving DUP backing. Northern Ireland would not be in the EU’s Single Market or Customs Union, enabling the entire UK to have trade sovereignty.

Crucially though, such an arrangement would not cover the thorny issues of customs, VAT and governance (relating in particular to the roles of the European Court of Justice and the Stormont Assembly).

An agreement?

Would the EU agree to this? In short, no – it simply breaches too many EU red lines. But it could be the starting point for a serious discussion. A lot rides on whether Johnson genuinely wants a deal or simply wants to claim that he tried and to be able to shift the blame onto Brussels.

Arguably the two are not mutually exclusive: he may genuinely want to reach a deal and believe that his proposals are a realistic way of finding one, while simultaneously being alive to the political benefits of being able to blame the EU for a failure.

The EU is in a bind. While there are many who would favour a 31 October exit, they are well aware that far from bringing an end to the Brexit drama, a no-deal would ensure that it continued to fester.

There are rumours that France in particular is increasingly keen to resolve the impasse in order to push ahead with a bold set of initiatives, leading to increased pressure on Ireland behind the scenes to compromise. The chances of a deal before 31 October are slim, but probably more than negligible.

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