After the latest round of Brexit trade talks ended in a deadlock, the EU’s chief negotiator Michel Barnier launched another bitter attack on the UK. In a speech to Irish think tank the Institute of International and European Affairs on Wednesday, Mr Barnier said the UK will “have to move” if it wants a trade deal by the end of 2020. Mr Barnier also claimed he was “worried and disappointed” about the lack of concessions from his British counterpart, David Frost, after the pair met in London on Tuesday.
Downing Street said it was “clear [a deal] will not be easy to achieve”.
The Prime Minister’s official spokesman said “major difficulties remain” between the two sides, but the Government was keeping in close contact with the EU.
Brussels still insists on maintaining its current fishing rights in British waters and wants London to agree to a number of EU regulations, including environmental standards, workers’ rights and state aid rules.
On the other hand, Prime Minister Boris Johnson is demanding the right to diverge from the bloc’s rules in order to strike trade agreements around the world.
As the clock ticks down and tensions mount, unearthed reports shed light on another option available for the UK.
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EU’s chief Brexit negotiator Michel Barnier in front of Number Ten, Downing Street
In 2017, Guy Verhofstadt, Leader of the Alliance of Liberals and Democrats for Europe Group, said an association agreement between Britain and the EU based on Article 217 of the Lisbon Treaty could be “the best solution”.
Article 217 association agreement “often replaces a cooperation agreement thereby intensifying the relations between the partners”, according to the European External Action Service.
The Lisbon Treaty article, already enforced between the EU and Albania, Algeria, Bosnia and Herzegovina, Chile, Egypt and several other nations, including Ukraine, states: “The Union may conclude with one or more third countries or international organisations agreements establishing an association involving reciprocal rights and obligations, common action and special procedure.”
Being an associate member of the bloc would mean paying a membership fee instead of signing a free trade agreement.
This type of deal was also suggested by the Centre for European Policy earlier that year.
In a research paper, the organisation suggested the UK could follow a so-called “Ukraine Plus” model and establish a relationship with the EU similar to that of the Eastern European state.
The paper’s authors wrote. “A model for this special type of partnership could be provided by the Association and Free Trade Agreement which the EU has concluded with Ukraine.
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European Parliament’s Brexit Coordinator Guy Verhofstadt
“This has been in effect since January 1, 2016, although some of it only provisionally because ratification by the Netherlands is still outstanding.
“Firstly, the ‘Ukraine Model’ corresponds to the British objectives in that it contains substantial market access but does not require the application of EU law or compliance with the case law of the ECJ, nor does it provide for free movement but it does allow free trade agreements with third countries.
“Thus the United Kingdom’s four key requirements are met.”
However, the think-tank acknowledged that issues could arise with a Ukraine-style deal for the UK, particularly when it comes to the financial services sector.
Banks currently have the right to “passport” their financial licences in one EU market to another, preventing them having to go through the costly and complicated process of being regulated in each market where they operate, but that passport could be lost after the Brexit process has been completed, causing chaos for Britain’s financial services industry.
The report noted: “The agreement with Ukraine is unlikely to satisfy the United Kingdom as regards the scope of trade liberalisation because it contains numerous restrictions on market access particularly for cross-border services.
“The United Kingdom will probably require better access to the EU internal market, primarily in the interests of the British finance industry.”
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Professor Carl Baudenbacher
The European Court of Justice
Former President of the European Free Trade Area Carl Baudenbacher criticised the Ukraine model, though, as it means Britain will still be under the jurisdiction of the European Court of Justice (ECJ).
He explained in a recent entry for the London School of Economics blog: “Under Trajan the Roman Empire, at its greatest extent, encompassed the entire Mediterranean region, but also parts of present-day Germany, Britain, Romania, Turkey, Syria and Armenia.
“The European Union is preparing to build a similar empire. Roman law played an important role in the expansion of the Roman Empire; and the EU relies on the export of its law, and the extraterritorial effect of the case law of the European Court of Justice (ECJ).
“The EU has concluded bilateral association treaties with four former Soviet republics, Ukraine, Georgia, Moldova and Armenia, under which these countries are aligning their legislation in important fields with EU law.
“The ECJ has a monopoly in the interpretation of treaty law which is identical in substance to EU law.”