Despite the UK’s 15 October deadline for the future relationship talks, PM Boris Johnson’s government remains willing to negotiate with the EU beyond the 15-16 October European Council. Both sides have therefore treated their respective ultimatums in a similar fashion: the EU’s initial insistence that the UK withdraw (parts of) the contentious internal market bill by 30 September was effectively dropped given both sides’ continued interest in talks.
This week’s European Council will therefore have no trade agreement to sign off on. One outcome could be the formal endorsement of so-called “tunnel” talks on the remaining technical contours of a deal. At the same time, however, there appears to be a growing realization – both in the EU negotiating team and in key capitals – that the remaining problems are political.
A change to the negotiation mandate is not on the cards, but key EU member states are considering a stronger role for France and the German Council presidency. This is explained by last year’s “Varadkar moment” when the withdrawal agreement was ultimately agreed in a political meeting between Johnson and his Irish former counterpart. The resulting deal resolved the Irish border question by turning it into the “front stop” of effectively continued Northern Irish membership of the single market and the customs union.
One year on, the key sticking points remain the questions of fisheries and of (enforceable) level playing field provisions. While many more EU member states are affected by both matters, the first question is of special importance to France, not least against the backdrop of looming regional (spring 2021) and national (spring 2022) elections. The second problem reflects the most fundamental issue at stake: the EU’s integrity in the face of a major country’s departure. In this sense, the level playing field question affects Germany as the holder of the rotating Council presidency – but also as the bloc’s largest member and the country politically and economically most dependent on the European project.
The idea in key capitals therefore seems to be that Paris and Berlin could try to create a new version of last year’s “Varadkar moment”. This would be done on the basis of and alongside the work done by chief negotiator Michel Barnier so far. Whether from Merkel’s arch-pragmatic or Macron’s “Jupiterian” perspective on politics, both Paris and Berlin seem still impressed by Johnson’s political ability to strike last-minute, high-level deals – and to exploit them very effectively, as in last December’s snap elections. The hope appears to be that this can be repeated towards the end of this year. The other motivation seems to be EU awareness of the highly political nature of the remaining key questions: how much fishing rights are exactly given up and when; and where precisely does the line run between protecting EU integrity and maintaining ties with one of Western Europe’s three biggest countries?
While a deal might ultimately be achieved in this way, the main risks remain unchanged. The agreement will be very basic, leading to new controls and restrictions. Just like after the withdrawal agreement, unresolved issues will continue to haunt both sides, likely for the remainder of this decade. The end of the initial grace period for euro clearing in summer 2022 and the yet-to-be-agreed dates for altering/phasing out the current fishing quota system are already looming as some of the resulting, medium-term signposts.