Special Northern Ireland Issues in Negotiation

The matter of the border between Ireland and Northern Ireland is complex and ambiguous. After Brexit, the internal Irish land border will be the EU-UK land border. The ultimate nature of this border will depend on the agreement, if any, reached between the UK  and the EU and the UK’s intentions in respect of customs and commercial policy. This will, in turn, be constrained by World Trade Organisation rules.

The United Kingdom Prime Minister highlighted the importance of avoiding a hard border in Ireland in her speech at Lancaster House in January 2017. The negotiation guidelines adopted by the European Council for the Brexit negotiations provide that:

“The Union has consistently supported the goal of peace and reconciliation enshrined in the Good Friday Agreement in all its parts, and continuing to support and protect the achievements, benefits, and commitments of the Peace Process will remain of paramount importance. In view of the unique circumstances on the island of Ireland, flexible and imaginative solutions will be required, including with the aim of avoiding a hard border, while respecting the integrity of the Union legal order. In this context, the Union should also recognise existing bilateral agreements and arrangements between the United Kingdom and England which are compatible with EU law.”

The UK Parliamentary Report has indicated that the key objectives of an agreement between the UK and Ireland  or the EU should be,

  • maintenance of the open land border between UK and Ireland as well as the ease of movement across the boundary between Northern Ireland and the rest of the UK;
  • maintenance of the Common Travel Area with free movement of UK
  • maintenance of the right of UK and Irish citizens to reside and work in each other’s jurisdiction
  • retention of rights to Irish citizenship for the people of Northern Ireland;
  • customs and trade agreement between the countries, subject to the agreement of the institutions of the EU and UK;
  • acceptance of the Northern Ireland Executive’s devolved powers in making decisions about the free movement of workers within its jurisdiction;
  • reaffirmation of the commitment to the Belfast/ British-Irish Agreement;
  • continued eligibility for cross-border projects to EU funding programmes.

Immigration Border

Immigration policy is shared between EU and the member states. Most competences are reserved to the member states, subject to the overriding rights of EU  citizens to travel, work, establish themselves, etc. in other EU states. Ireland and the UK have a joint opt out from the Schengen arrangements. This is likely to continue post-Brexit.

The immigration border is less likely to be an issue given the express commitment to the maintenance of the so-called Common Travel Area. The common travel area is not formally set out in any treaty or the agreement. It is informal understanding which has been translated into domestic legislation and practice in each jurisdiction.

The February 2017 White Paper has set out that as a minimum, the Common Travel Area with Ireland should be preserved. The Irish government has expressed a similar position. See the separate article on the Common Travel Area.

The maintenance of the Common Travel Area may come under pressure in due course as it necessitates continuing differentiation and carves out from the basic EU  free movement and equality principles which are expressed in theTreaty and potentially invalidate any provision to the contrary.

Background to Custom Border

Prior to 1993, customs posts existed at the land and other borders. The customs union came fully into force after the end of the initial EEC transitional period in 1978. However,  restrictions still applied outside customs to quasi-customs and regulatory requirements including excise.

The completion of the single market at the end of 1992 had the objective of removing physical border controls. Some regulatory divergence continues, in particular in relation to excise and VAT. However, the “1992” reforms achieved a threshold of commonality such as to enable the removal of general border controls.

Prior to 1995, there was a significant military presence at checkpoints on the land border due to the security position in Northern Ireland.

EU Competence in Customs and Border Regulation

Since the inception of the European Communities customs and the external common commercial policy had been exclusive competences of the European Communities, now the European Union. Accordingly,  making an agreement on the future customs arrangements is one exclusively between the European Union and the United Kingdom.

The customs union within the EU applies both to express customs charges as such and measures having an equivalent effect. The customs regime as policed in all states extends beyond the collection of customs to the enforcement of regulatory standards and single market issues. This includes action against counterfeiting, enforcing compliance standards, health, and safety standards in respect of goods, trade measures, including trade policy measures (and countermeasures) and environmental protection.

The EU takes a consistent and single approach to customs enforcement across all borders. To do otherwise would be to create a hole in the customs union which could be abused and undermine the free movement of custom cleared goods within the entire European Union.

The European Union system already uses developed electronic systems of control for declarations. It provides for simplification procedures. It provides for authorised economic operators who are reliable, established private parties who are subject to fewer checks and scrutiny in view of the trusted trader status. In contrast, bodies and persons not so authorised are likely to be subject to some elements of random or profiled checks and searches at a minimum.

The EU has entered international customs cooperation and mutual assessment agreements to facilitate customs procedures with third countries. The applies in particular in respect of the EU-Turkey incomplete customs union. Other customs agreements deal with the exchange of information.

Leaving the Customs Union

The expressed UK preference to exit the customs unions inevitably requires some element of frontier for goods passing between the UK and the European Union. In the absence of a comprehensive customs union, each of the UK and the EU will be required to apply rules of origin to ensure other third countries do not benefit from the advantageous customs terms applicable to each other’s goods and products.

If customs were applied as between the United Kingdom and EU, then provisions are likely to be made for customs verification, even if most commercial movements are undertaken through waiver and electronic customs controls provisions.  This of itself will require physical barriers and checks for trade in goods.

If the United Kingdom is not a party to the single market or some very close equivalent, then apart from the above customs issue. some elements of border checks are likely to be required for the purpose of regulatory control. Regulatory alignment or common standards may facilitate free movement of goods and service

If the United Kingdom becomes a party to a free trade area with no customs charges even with  “single market” membership or access but without being part of the customs union, then goods movements would still require proof of origin in order to preserve the integrity of both the EU and UK markets. These obligations would apply as a matter of basic WTO requirement as well as basic European Union (and likely future UK) law.

The EEA states which participate in the single market, do not have a full customs relationship with the EU. They are not bound by the external EU common customs tariffs and accordingly rules of origin are necessary so s to prevent the benefit of the arrangement extending to any third party goods.

The Sweden-Norway border involves custom spot checks without a physical border. Norway is part of the single market and accordingly, there is regulatory equivalence in goods. However, it is not part of the customs union. Customs practice and procedure uses technological and electronic controls to a much great extent than in the past.

Outlook

Unless the United Kingdom remains a party to the customs union and or an arrangement very close to it, and maintains regulatory alignment, then some element of border checks would appear to be necessary at a minimum.

There has been a history of smuggling and illegal cross-border trade for many years before, and to a much lesser extent, since 1993. It is unlikely that electronic controls would effectively control or eliminate it. It is likely that some physical checks would be required at or near the border.

It appears as of early 2018, that the most that may happen by way of derogation in respect of the Irish border is that the issue will be managed in a way such as to minimize economic social and political disruption to the extent that this is consistent with the defence of the EU and UK’s respective customs territory and market. A significant issue in the negotiation of an EU trade deal  is  the extent and nature of the border controls, that are likely to be required to be put in place.

The possibility of a UK Ireland bilateral agreement has been raised.  It is contemplated by the EU Council guidelines, but it must be compatible with EU law. A difficulty is that agriculture, trade and many other matters are exclusive EU competences. Depending on its terms, an arrangement may require a derogation from the European Union. It may require EU Treaty change, depending on its terms. Precedents exist whereby particular territories of EU States have been accommodated.

The possibility of a special status in some measure for Northern Ireland has been raised.  There are a number of precedents and protocols added to agreements which allow for particular problems and seek to resolve particular issues where some measure of bespoke arrangement is necessary.

 

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