Our title is literal, the hot news on Brexit is that the British Government has stunned the country, the EU and probably the world by publishing a bill which it admits would break an international treaty – a treaty that the Prime Minister himself signed. Why?
We’re puzzled by what the Government is doing in publishing the ‘UK Internal Market Bill’ (the Bill) which it admits itself would break international law. It’s hard to believe that it intends to go through with it when this admission means it wouldn’t stand a chance before an international court, to which the EU would be bound to refer it. Perhaps therefore it is a ploy to capture maximum publicity for the onerous traps the UK is heading for in the event of no deal but that it will withdraw the bill before Parliament votes on it (it is already being debated). This might help to consolidate public opinion behind the Government in a fight to evade the traps and as a message to the international community that the EU could impose unprecedented and unfair treatment on its departing member. Like most others outside the Cabinet, or even just the Prime Minister’s inner circle, we’re guessing.
WA2 was drafted in haste and the implementation of some details was left to be decided later. What the Government has belatedly realised is that any British company in receipt of state aid and whose outputs arrived in the province might be examined under the EU’s state aid rules, so effectively extending EU control. The Northern Ireland Protocol also requires extensive paperwork and checks on goods passing between NI and Britain. The Bill would allow the UK to determine what is necessary. Northern Ireland Secretary, Brandon Lewis reminded Parliament that the protocol states that it should impact as little as possible on the everyday life of NI communities and depends on the consent of the people of the province – this had to be kept in mind when implementing the protocol.
The EU and others claim that failure to agree on border arrangements would jeopardise the peace. Charles Moore, contributor and ex-editor of the Daily Telegraph, points out that it is not just the North-South border that matters but now also an East-West one since that is what the WA2 revision has introduced in place of the backstop. Are Unionists to lie down peacefully while trade barriers with Britain are erected with onerous form filling and exit declarations?
On our supposition (that it is a temporary, publicity-seeking ploy) it seems to be risking a lot, namely that the UK cannot be relied upon to do what it agrees to. Will this raise the bar to an agreement even higher as the EU seeks to make other areas even safer for it? How will non-EU countries react to proposed free trade agreements with the UK?
United States free trade agreements require a majority of the Congress and Senate to pass. As one member of the House said, “It would also be very difficult to enter into a trade negotiation with a party that would have just ripped up a very important agreement to us.Why would you engage into negotiations with such a party?Because they might just turn around and use the same tactic against you.“
Historically UK state aid has been half the level of France’s and less than a third of Germany’s so perhaps the EU shouldn’t worry. But state aid appears to be a crucial issue affecting Boris Johnson’s post-Brexit plans. His principal advisor, Dominic Cummings, wishes to follow the footsteps of the US which has looser state-aid rules and invests in startups via state-pension funds or other means. He raises the history of the internet which began as the Defence ARPA network, triggering an explosion of technology companies, some of which have grown to mammoth proportions. There are other government-funded research developments that have been taken on by enterprises and succeeded commercially.
The Bill reads: “Certain provisions to have effect notwithstanding inconsistency or incompatibility with international or other domestic law.” Which means the Internal Market Bill would apply in UK courts above those specified in WA2. It would enable ministers to dis-apply parts of the Northern Ireland protocol by modifying export declarations and other exit procedures, and stop it imposing EU state aid laws where any UK measure affects trade between Northern Ireland and the block.
The intention is good but the consequences for the UK’s international reputation could be damaging. Theresa May made that point to Parliament despite her awful premiership having created the circumstances leading to this.