EU promises ‘creative’ solutions to fix Northern Ireland trade row with UK

Brussels on Wednesday vowed a major reduction in post-Brexit checks on goods moving between Great Britain and Northern Ireland — but rejected U.K. demands to negotiate a “new” protocol.

One day after U.K. Brexit Minister David Frost ramped up the rhetoric in an EU-U.K. spat over trade frictions, warning that a failure to renegotiate the Northern Ireland protocol “would be a historic misjudgment,” the European Commission responded by releasing what it called a “robust package of creative, practical solutions” that it claims make a renegotiation unnecessary.

The proposals were warmly welcomed by businesses in Northern Ireland. The U.K. government, which has called for major governance changes to the post-Brexit trade protocol, is keeping its powder dry for now as the two sides ready for extensive talks.

The protocol was agreed by both EU and U.K. as part of the Brexit Withdrawal Agreement in 2019, but London has repeatedly argued that the negotiated solutions do not work and are causing political and economic disruption in Northern Ireland. Suggestions London might trigger Article 16 to suspend the protocol have triggered fears of a trade war, with EU officials warning that the bloc would react to such a move by launching legal action and the potential imposition of tariffs.

In a document covering four areas, the Commission suggested reducing cumbersome custom checks on goods and easing safety checks on food products that enter Northern Ireland from Great Britain.

It also outlined moves to ease the export of medicines and increase the involvement of political, economic and civil society actors in Northern Ireland. The protocol has been deeply controversial with Northern Ireland’s unionists, who see it as driving a wedge between Northern Ireland and the rest of the U.K.

“Today’s package has the potential to make real, tangible difference on the ground,” Commission Vice-President MaroÅ¡ Å efčovič, the EU’s point person on Brexit, told reporters in Brussels. “We have put a lot of hard work into this package” and at times even “went beyond EU law” to find solutions to trade frictions, Å efčovič added.

One major British demand was conspicuously absent, however. London wants the bloc to end the “highly unusual” oversight of the Court of Justice of the EU (CJEU) when it comes to EU law in Northern Ireland, and replace it with an arbitration system similar to those in other international trade deals. The Commission ruled out any changes to this part of the protocol, which it views as an ideological demand on the part of Britain.

“The EU has an unwavering commitment to the people of Northern Ireland” and to safeguard the Good Friday peace agreement, Å efčovič said. He stressed that he sees the Commission’s proposal as a chance to set a positive agenda, and added: “I hope that Lord Frost will join me in that effort.”

The U.K. government said it was “studying the detail” of the proposals and insisted it “will of course look at them seriously and constructively.”

A spokesperson added: “The next step should be intensive talks on both our sets of proposals, rapidly conducted, to determine whether there is common ground to find a solution.”

But London warned it needs to see “significant changes which tackle the fundamental issues at the heart of the protocol, including governance.”

‘Positive breakthrough’

Business groups on both sides of the Irish Sea welcomed the Commission’s proposals and stressed the priority for business remains easing trade rather than the U.K.’s sought-after changes to the role of the CJEU.

The main group representing shipping companies and hauliers in Northern Ireland, Logistics UK, said the Commission had “listened” to their concerns and its proposals will make the Irish Sea border much more user-friendly for businesses reliant on smooth delivery of goods from Great Britain.

“It’s a big positive breakthrough,” said Seamus Leheny, policy director at the lobby group. “From our members’ perspective, this solves a lot of the problems. Most importantly, it reduces administrative paperwork and costs.”

Aodhán Connolly, director of the Northern Ireland Retail Consortium, described the package as “ambitious” and said it contains “some wonderful things” which would “remove some of the friction” to trade across the Irish sea.

Connolly oversees the Northern Ireland Business Brexit Working-Group, which has been in regular contact with the Commission and the U.K. government over how to solve the issues with the protocol. None of the companies he’s spoken to in these roles has ever raised the issue of oversight of the Court of Justice of the EU (CJEU).

“We’re into containers and moving them, not courts or the arbitration method,” he said. “What we need is certainty, simplicity and affordability to keep our businesses competitive.”

Some longstanding critics of the protocol remained unimpressed by the Commission’s proposals, however.

Northern Ireland’s Democratic Unionist leader Jeffrey Donaldson said the plans “fall far short of the fundamental change needed.” He reiterated his intention to withdraw his party from the Northern Ireland power-sharing government, triggering its collapse, unless all checks on British goods arriving in the ports of Belfast and Larne were halted.

Donaldson’s moderate rival for pro-U.K. votes, Ulster Unionist leader Doug Beattie, welcomed the EU package as offering “very clear and pragmatic solutions.” But he warned that deadlock over the CJEU’s role could give Donaldson all the pretext he needs to create “a power vacuum” that could stir more dangerous rioting than was experienced in working-class Protestant parts of Northern Ireland in April.

“A brick will turn into a petrol bomb. A petrol bomb will turn into a coffin. I don’t want to see that,” Beattie said.

And in the Republic of Ireland, Foreign Minister Simon Coveney warned a U.K. rejection of the Commission’s compromise package would mean “we’re heading into a very difficult space in terms of retaliatory measures.”

Coveney said any U.K. action “to collapse the protocol” would have “a spillover effect into the trade agreement – which is bad news for everybody.”

But he said he hoped the U.K. would seize the opportunity to reduce conflict with Brussels, not heighten it. “We’re not talking about a trade war between the EU and the United Kingdom. We’re talking about solving problems, not creating more problems,” he said.

On the continent, David McAllister, the chair of the European Parliament’s Foreign Affairs Committee, said “the package of measures presented today addresses concerns on the island of Ireland” but stressed that the Northern Ireland protocol “cannot be renegotiated. It is part of the solution to the problem. The problem is and remains Brexit.”

EU negotiators left for London on Wednesday to present the proposals to their U.K. counterparts — and Šefčovič said he had invited Frost for lunch on Friday.

“It is my hope that in the coming weeks we will jointly arrive at an agreed solution,” Å efčovič said. He hopes a solution can be in place by the beginning of next year.