{"id":78623,"date":"2018-05-18T22:00:43","date_gmt":"2018-05-18T22:00:43","guid":{"rendered":"http:\/\/www.bnreport.com\/uk-customs-proposal-is-really-brexit-delayed-further\/"},"modified":"2018-05-18T22:00:43","modified_gmt":"2018-05-18T22:00:43","slug":"uk-customs-proposal-is-really-brexit-delayed-further","status":"publish","type":"post","link":"https:\/\/www.bnreport.com\/en\/uk-customs-proposal-is-really-brexit-delayed-further\/","title":{"rendered":"UK customs proposal is really Brexit delayed further"},"content":{"rendered":"

Its now all eyes on July 2022 \u2014 the date Brexit might actually mean Brexit.<\/p>\n

According to senior officials familiar with internal Cabinet discussions, Britain could need just over three years after it has left the EU to make preparations for its new long-term customs relationship with the bloc \u2014 although many are still pushing for a much quicker changeover.<\/p>\n

As POLITICO revealed Wednesday<\/a>, to bridge the gap between March 29, 2019 \u2014 when Britain formally leaves the EU \u2014 and mid-2022, when officials think the new technical border solutions will be ready, Theresa May and David Davis hope to negotiate a \u201ctime-limited goods arrangement\u201d with Brussels. The bridge is needed because the currently agreed transition period, which runs to December 2020, probably isnt long enough.<\/p>\n

Under this arrangement, the U.K. would stay inside the EUs external tariff, but not its common commercial policy beyond the end of transition. That would allow ministers to claim Britain has taken back control of its trade policy as it will allow the U.K. to strike limited free-trade deals with countries around the world, even if these cannot cover tariffs in the short term.<\/p>\n

Taken together with ongoing \u201cfull alignment\u201d with EU farming and agricultural standards and a single electricity market on the island of Ireland during this period, the U.K. hopes this offer to remain inside the common external tariff will be enough to satisfy the EUs demand for a legally-binding \u201cbackstop\u201d that will be written into the withdrawal agreement guaranteeing an open border in Ireland.<\/p>\n

While the U.K. government has yet to formally draft this proposed new backstop into legal text \u2014 the prime minister has said she plans to do this \u201cin due course\u201d \u2014 Cabinet ministers have signed off on the proposal, two officials confirmed.<\/p>\n

Brussels, however, is not convinced.<\/p>\n

First problem: The EU believes it already has a backstop in full alignment for Northern Ireland with the EU customs union \u2014 even if Theresa May made clear again that such a proposal was \u201cunacceptable.\u201d<\/p>\n

Second problem: What good is a backstop if its time limited? As far as EU officials are concerned \u2014 supported by the Irish government in Dublin \u2014 the U.K. needs to come up with a backstop that works in perpetuity.<\/p>\n

Third problem: The EU still does not think the U.K.s proposed \u201cmaximum facilitation\u201d customs model is worth the paper it is not written on, increasing the need for a backstop that works long-term. Max fac, as it is known in Whitehall, is now the clear favorite to win Cabinet backing over the so-called customs partnership that was originally the prime ministers favored option, although there has yet to be a formal agreement among ministers on this.<\/p>\n

A fourth, more general problem for the EU is the U.K. proposal looks like too much of a good deal for London, cherry-picking some juicy bits of the EU and abandoning others.<\/p>\n

To the U.K. government though, this is the only acceptable way forward.<\/p>\n

A backstop without a sunset clause is tantamount to giving foreign governments an \u201copen-ended\u201d veto over U.K. policy. \u201cNo parliament can bind the next,\u201d is the maxim on which British democracy is built.<\/p>\n

\u201cWe cannot accept any kind of open-ended approach from the European Commission,\u201d one senior U.K. official said.<\/p>\n

July 2022 is the \u201clogical tie-up\u201d between the proposed new backstop and the technical solutions the U.K. government believes can solve the Irish border, one senior official said on condition of anonymity.<\/p>\n

So what next? The U.K. will present its new offer to Brussels within two weeks. Negotiators then have less than a month to thrash out the basis for a compromise before Junes European Council.<\/p>\n

Hold on to your hats.<\/p>\n

This insight is from <\/em>POLITICOs Brexit Files newsletter, a daily afternoon digest of the best coverage and analysis of Britains decision to leave the EU available to Brexit Pro subscribers. Sign up here<\/a><\/em>.<\/p>\n","protected":false},"excerpt":{"rendered":"

Its now all eyes on July 2022 \u2014 the date Brexit might actually mean Brexit.<\/p>\n

According to senior off..<\/p>\n","protected":false},"author":1,"featured_media":78624,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[202],"tags":[],"class_list":["post-78623","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-finance"],"yoast_head":"\nUK customs proposal is really Brexit delayed further - Business News Report<\/title>\n<meta name=\"description\" content=\"Its now all eyes on July 2022 \u2014 the date Brexit might actually mean Brexit. 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