EC President Jean-Claude Juncker said earlier this month that in case of a ‘no-deal’ scenario occuring, the UK would be expected to address three main separation issuesas a precondition before the EU would consider embarking on discussions about the future relationship. These are: (1) protecting and upholding the rights of citizens who have used their right to free movement before Brexit, (2) honouring the financial obligations the UK has made as a Member State and (3) preserving the letter and spirit of the Good Friday Agreement and peace on the island of Ireland, as well as the integrity of the internal market.
Guidance in 5 areas
1. Citizens’ residence and social security entitlements
The European Commission has repeatedly said that protecting the rights of UK citizens in the EU in a no-deal scenario is a priority and that Member States should adopt a generous approach with regards to their rights. The UK is expected to reciprocate this approach. The EU27 Member States have prepared national contingency measures to ensure continued legal residence in the immediate aftermath of a ‘no-deal’ scenario for UK citizens residing legally in the EU27. Today’s guidance provides an overview of the EU’s contingency measures, notably the contingency Regulation on Social Security Coordination. The Commission has proposed that Member States adopt a unilateral coordinated approach to address some issues not covered by the Regulation and, to complement that approach, point to areas where individual Member States could provide further protection through their own national, unilateral measures.
2. Police and judicial cooperation in criminal matters
In a no-deal scenario, the EU’s legal framework on police and judicial cooperation would cease to apply to the UK. Cooperation with the UK will therefore have to be based on alternative legal frameworks and cooperation mechanisms, based on international and national law. Today’s guidance outlines the relevant fall-back instruments that the EU and its Member States can rely on to ensure that law enforcement and judicial cooperation can continue in order to guarantee a continued high level of security for citizens. It also provides guidance to Member States on the disconnection of the UK from various EU databases, networks and information systems.
3. Medicinal products and medical devices
The medical sector has already received prior guidance from the EC in July 2017 and thanks to preparedness measures, the majority of medicinal products concerned by the UK’s withdrawal should now be compliant with EU legislation as of the UK’s withdrawal date. It is possible, however, that despite best efforts some medicinal products and medical devices may not be compliant in time. There is, therefore, a risk of shortages if economic operators do not act swiftly to remedy the situation. Today’s guidance highlights how the Commission will work with the European Medicines Agency (EMA) and national medicines regulators to monitor the situation closely and address any potential problems. It also outlines the possibilities for making use of exemptions and derogations available from the existing rules, in order to mitigate the risk of shortages of medicinal products and of critical medical devices in case of a no-deal scenario.
4. Data protection
As stated in the Commission’s preparedness Communication of 13 November, the Commission considers that the existing tools under the General Data Protection Regulation for data exchange with third countries are sufficient to cater for the immediate needs of data transfers to the UK in a no-deal scenario. Today’s guidance provides details on these tools, the well-defined conditions for making use of derogations, as well as on the practical steps that EU companies and authorities will have to take to ensure continued compliance with the EU’s data protection rules.
The EU has adopted two contingency measures in the area of fisheries to cover all scenarios under a ‘no-deal’ Brexit. On the one hand, the EU has created the appropriate legal framework to allow UK vessels reciprocal access to EU waters throughout 2019, if the UK grants such access to EU vessels in its waters. On the other hand, the EU has also adjusted the eligibility criteria of the Fisheries and Maritime Fund, to ensure that fishermen who have to cease their activities – in case the UK does not grant continued access to its waters – can receive compensation. In such a case, it would be essential that Member States adopt a coordinated approach to ensure a level-playing field between EU fishermen in different Member States and to protect marine resources. Today’s guidance provides details on such a coordinated approach. The Commission is working with the Member States most concerned on a framework for the monitoring of changes in fishing activities in EU waters, in order to avoid any distortions.
A no-deal scenario
In a ‘no-deal’ scenario, the UK will become a third country without any transitional arrangements. All EU primary and secondary law will cease to apply to the UK from that moment onwards. There will be no transition period, as provided for in the Withdrawal Agreement. This will obviously cause significant disruption for citizens and businesses.
In such a scenario, the UK’s relations with the EU would be governed by public international law, including rules of the World Trade Organisation. The EU will be required to immediately apply its rules and tariffs at its borders with the UK. This includes checks and controls for customs, sanitary and phytosanitary standards and verification of compliance with EU norms. Despite the considerable preparations of the Member States’ customs authorities, these controls could cause significant delays at the borders. UK entities would also cease to be eligible to receive EU grants and to participate in EU procurement procedures under current terms.
UK citizens will no longer be citizens of the European Union. They will be subject to additional checks when crossing borders into the European Union. Again, Member States have made considerable preparations at ports and airports to ensure that these checks are done as efficiently as possible, but they may nevertheless cause delays.
While the impact of a no-deal scenario will be felt throughout the European Union, it is clear that some regions and economic sectors will be affected more directly. The Commission has explored how current EU funds and programmes could be mobilised in case of a “no-deal” and in the case the UK fails to pay what is envisaged under the contingency EU budget Regulation. By reprogramming certain structural funds, activating measures against disturbance of agricultural markets, and using specific instruments such as the programme for Competitiveness of Small and Medium-Sized Enterprises (COSME), the European Globalisation Adjustment Fund (EGF), the Solidarity Fund and the European Fund for Strategic Investment (EFSI), additional dedicated funding can be made available.
Technical and financial assistance from the EU can also be made available in certain areas, such as the training of customs officials under the Customs 2020 programme. Other programmes can help similar training projects in the area of sanitary and phytosanitary controls. For agriculture, EU law provides a variety of instruments to cope with the most immediate effects of the withdrawal of the UK, in particular in a no-deal scenario.
For more immediate support to affected stakeholders, for example small and medium-sized companies with a significant exposure to the UK, EU State aid rules offer flexible solutions for national support measures.
Member States have also been engaged in intensive national preparations. An overview of residency rights in the EU27 Member States is available here, as well as direct links to national preparedness websites.