Approaching an Agreement: EU-UK Trade Talks

The EU and the UK are approaching an agreement regarding post-Brexit trade negotiations as the December 31 deadline looms on the horizon. (Path For Europe)

In a series of Brexit trade talks that began at the head of this year, the EU and the UK are nearing a make-or-break point. Although the in-person talks have been temporarily suspended because of a case of COVID-19 among the EU negotiating team, the EU’s main negotiator Michel Barnier and his UK counterpart David Frost have continued their negotiation remotely.

Even though the UK withdrew from the EU on January 31 of this year, the process of Brexit will not be completely finalized until the end of the UK’s 11-month transition period. The purpose of this transition period is to allow both sides some time and space to figure out the course of their future relationship. 

Since the deadline for extending the transition period has passed, the economic partnership between both parties must be finalized by December 31. If a trade deal is not reached by then, the UK would have to exit the EU's single market and customs union and subsequently abide by the rules of the World Trade Organisation, which imposes tariffs and border checks on UK goods traveling to the EU. 

Because this outcome would increase the costs for businesses and consumers, both sides desire to avoid a no-deal exit. However, the EU has said it would not agree on a deal that is "at any price," and UK Prime Minister Boris Johnson has declared the UK would prosper either way.

Not only are the two parties at a race against time, but they are also at odds with each other. After one of their many "short and brutal" meetings on November 14, Frost and Barnier left off where they had started. The EU continues to insist on a level-playing field for regulations on British and European firms, whereas the UK disagrees about fishing quotas and enforcement mechanisms for legal agreement.

According to Philip Rycroft, the former Permanent Secretary at the Department for Exiting the EU, the trade negotiation “is about the balance of obligations and benefits for both sides and there are some very big decisions still to be made."