Isle of Man

The Isle of Man is not part of the United Kingdom or the European Union. It is neither a member or associated member of the European Union. It did not take part in the Brexit referendum.

It is a crown dependency with its own independent parliament and administration. The Queen is sovereign of the Isle of Man and is represented by a Lieutenant Governor.

The Isle of Man was permanently settled by Celts and came under Viking control in 1079. The land passed to a feudal lordship under the Crown in 1266 The Lordship was acquired by the crown in 1764. The population of the Isle of Man is approximately 84,000 in the 2011 census.

The Tynwald (parliament) passes legislation with the assent of the Crown granted in the Privy Council. The Crown is responsible for defence and diplomatic representation. It acts on the advice  of the of UK Ministry of Justice.

The Isle of Man is not entirely free to choose its relationship with the EU. It is not sovereign and cannot join the EU in its own right nor can it join EFTA. Accordingly, the Isle of Man’s options will be determined by the ultimate UK position.

The Channel Islands.

The Channel Islands are an archipelago in the English Channel off the French coast of Normandy. They include two crown dependencies, the Bailiwick of Jersey and Baiwlick of Guernsey., comprising Gurnsey, Alderney, Sark and some other Islands.

They are the residue of the Duchy of Normandy. They are not part of the United Kingdom. The United Kingdom is responsible for their international relations and defence. Their total population is 164,000.

The two Bailiwicks have been separately administered since the 13th century. Each has its own independent laws parliament and representative bodies. The Bailiwick of Guernsey is itself divided in three jurisdictions, Gurnsey, Alderney, Sark each with its own legislature. Jersey and Guernsey have self-government and have significant autonomy

The population of Jersey is approximately 100,000, Guernsey 63,000, Alderney 2,000, Sark 60. Three smaller Islands have a population of 63.

Accession Protocol (Isle of Man and the Channel Islands)

As originally constituted, the Treaty of Rome applied the treaty to all European territories for whose external relations member States are responsible. The Isle of Man and other crown dependencies requested special provisions and the treaty was amended disapplying the terms to Crown dependencies and setting out the particular and limited relationship of the Community and the Islands,  which was set out in the protocol to the UK act of accession.

Under Protocol 3 UK’s accession to EEC  treaty, the Isle of Man was included in the  EU customs area which allows for trade in Manx goods without tariffs throughout the EU.

The Community rules on customs matters and quantitative restrictions, in particular, those of the Act of Accession, shall apply to the Channel Islands and the Isle of Man under the same conditions as they apply to the United Kingdom. In particular, customs duties and charges having equivalent effect between those territories and the Community are prohibited. The Common Customs Tariff applies.

In respect of agricultural products and products processed therefrom which are the subject of a

special trade regime, the levies and other import measures laid down in Community rules and applicable by the United Kingdom shall be applied to third countries.

Such provisions of Community rules, in particular, those of the Act of Accession, as are necessary to allow free movement and observance of normal conditions of competition in trade in these products are also applicable.

Agriculture (Isle of Man and the Channel Islands)

Regulation 706/ 1973 provides

  • rules applicable to the UK for trade in agricultural products covered by the Treaty also apply to the Islands with the exception of rules on refunds and compensatory amounts.
  • for the purpose of these rules, the UK and the Isle of Man (and the Channel Islands) were deemed to be treated as a single member state.
  • no refunds or compensatory amounts are to be granted in respect of products originating or coming from the Islands in respect of which customs formalities were completed in a member State.
  • where a product is exported to EU states or third countries, the Islands could not grant aid in excess of that granted in the UK
  • rules on state aid applied to the products.

Community rules apply in respect of the following.

  • Veterinary
  • animal health,
  • plant health,
  • marketing of seeds,
  • foods legislation,
  • quality and marketing standards.

Free movement of persons and services

There is limited free movement of capital, persons, and services.  The Isle of Man and the Channel Islands are not part of the single market. They do not participate in freedom of establishment, freedom of movement and freedom to provide services.

They are third countries for financial services and services generally. They do not enjoy access to the single market.

Manx citizens are British citizens. However, because the Isle of Man is not part of the European Union, persons born on the Island without a parent or a grandparent UK born naturalised, registered or resident for more than five consecutive years do not have the same rights as British citizens in relation to employment and establishment in the EU. EU citizens may travel and reside but not work on the Island, without restriction.

The Isle of Man and the Channel Islands are part of the common travel area which allows free travel within the United Kingdom, Ireland, and Islands. There is a commitment to maintain in its current form.

The Channel Islands similar Status to the Isle of Man

The relationship of Jersey and Guernsey to the European Union is similar to that of the Isle of Man]. They are part of the European Union for the purpose of trade in goods.

The U.K. deals with their international affairs and relations. The UK consults them in relation to obligation and matters which affect them.

There is a Channel Island’s Brussels office which seeks to promote the Channel Islands interest in Europe.

Unlike the Isle of Man, the Channel Islands is outside the EU VAT area.

Application of EU Laws IoM

Most EU Customs and trade policy laws apply. The crown dependencies are covered by EU trade agreements to the extent of protocol 3 and no further.

There are various pieces of EU legislation which have been made domestic law in the Isle of Man / Channel Islands together with the European legislation that applies directly. The EU obligations on the Isle of Man is given effect in Isle of Man law by the European Communities, (Isle of Man) Act, an Act of the Tynwald and by the respective legislatures in the Channel Islands.

There are several areas in which EU legislation may effectively apply because of bilateral agreements with the UK, including in particular agreements on customs and excise, national insurance, value-added tax.

The Isle of Man is treated as if it were part of the EU for Vat purposes.

In effect, goods which are destined for the EU must comply with EU standards and services provided into the EU must meet EU standards.

The Isle of Man may choose to adopt EU measures and legislation voluntarily. It has adopted environmental and other like standards for practical and reputational reasons. Many such standards reflect global standards.

Much legislation has been passed to reflect EU standards such as the REACH  legislation on chemicals. It will be necessary for the Isle of Man to enact a Withdrawal Act similar to that for the UK to adopt and re-enact ongoing EU legislation.

Equally,  new laws in Guernsey and Jersey are inspired by the EU GDPR.

Channel Islands

Effect is given to treaty arrangements in Jersey by the European communities Jersey law 1973. There is equivalent legislation in Guernsey.

Residents do not necessarily enjoy citizenship rights. British resident citizens many qualify as EU citizens because their parents or grandparents residing in the U.K. in the past.

Jersey and Guernsey voluntarily use EU legislation and international standards on which they are based in many areas.

The Channel Islands comply with certain aspects of EU legislation for the purpose of third-party recognition in particular such as financial services legislation.

Jersey, Guernsey and the Isle of Man do not contribute to or receive funding from the EU. Legislation on trade and agricultural goods applies directly.

Effect of Brexit

Upon Brexit, the protocol regarding Isle of Man’s and Channel Islands’ membership of the Customs Union will fall away. Their exit will be negotiated by the United Kingdom which is responsible for external relations matters. The UK parliament has published a report on the implications of Brexit for the crown dependencies.

The customs union and currency union with the UK will continue after Brexit. The customs and excise agreement may need to be modified as to assumes and refers to EU rules. The Customs and Excise agreement between the Isle of Man and UK is expected to continue. It involved the pooling of excise receipts.

The Islands’ existing free trade with the European Union in goods including agricultural goods will fall away and may be subject to a new free trade agreement which may exist.

The Isle of Man and Channel Islands’ governments will bring forward  European Union Withdrawal Bills, similar to that enacted in respect of that for the United Kingdom.

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