The proposed bill seeks to remove customs checks on some goods entering Northern Ireland from the rest of the U.K. That will override parts of the trade treaty that Prime Minister Boris Johnson signed with the European Union less than two years ago.

Britain’s government maintained its move is justified under international law because of the “genuinely exceptional situation,” and Foreign Secretary Liz Truss blamed the EU for blocking a negotiated settlement. The European Commission said it could take legal action against the U.K.

Existing trade rules “provide business operators in Northern Ireland with access to the EU single market for goods. The U.K. government’s approach puts this access — and related opportunities — at risk,” said European Commission Vice President Maros Sefcovic.

In Ireland, Prime Minister Micheal Martin said it was “very regrettable for a country like the U.K. to renege on an international treaty.” German Chancellor Olaf Scholz echoed the sentiment, saying there was “no reason” for the U.K. to make such a move.

“It’s a rejection of all the agreements we reached between the European Union and Great Britain,” Scholz said. “The European Union will react to this as one and it has the whole toolbox at its disposal.”

Brushing aside criticism, Johnson told reporters that the proposed change is “relatively simple to do.”

“Frankly, it’s a relatively trivial set of adjustments in the grand scheme of things,” he told LBC Radio.

He argued that his government’s “higher and prior legal commitment” is to the 1998 Good Friday agreement that brought peace and stability to Northern Ireland.

Arrangements for Northern Ireland — the only part of the U.K. that shares a land border with an EU nation — have proved the thorniest issue in Britain’s divorce from the bloc, which became final at the end of 2020. At the center of the dispute is the Northern Ireland Protocol, which now regulates trade ties between Northern Ireland, which is part of the U.K., and the Republic of Ireland, part of the EU.

Britain and the EU agreed in their Brexit deal that the Irish land border would be kept free of customs posts and other checks because an open border is a key pillar of the peace process that ended decades of violence in Northern Ireland.

Instead, to protect the EU’s single market, there are checks on some goods, such as meat and eggs, entering Northern Ireland from the rest of the U.K.

But the arrangement has proved politically damaging for Johnson because it treats Northern Ireland differently from the rest of the United Kingdom. Northern Ireland’s Democratic Unionist Party has refused to return to the region’s power-sharing government until the protocol is scrapped or substantially changed.

The bill to override that arrangement is expected to face opposition in Parliament, including from members of Johnson’s own Conservative ranks. Critics say unilaterally changing the protocol would be illegal and would damage Britain’s standing with other countries because it’s part of a treaty considered binding under international law.

In Brussels, Sefcovic said the protocol was the “one and only solution we could jointly find to protect the hard-earned gains of the peace process in Northern Ireland.”

He added that the EU remains open to discussions with the British government to find a solution to the dispute.

Associated Press writers Samuel Petrequin in Brussels and Frank Jordans in Berlin contributed to this report.

Source: https://www.pbs.org/newshour/world/uk-moves-to-rewrite-brexit-trade-rules-around-northern-ireland-eu-threatens-legal-action

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With France set to start its six-month stint in the rotating EU presidency, Emmanuel Macron spoke on Thursday of a budget rethink within the bloc, took a swipe at the post-Brexit British government and said he planned remote talks with Russian President Vladimir Putin next week.

Macron also said that France would not be following in the footsteps of the United States, UK, Canada and Australia, by conducting a diplomatic boycott of the Beijing Winter Olympics, set to take place in February 2022.

The French leader said his priorities for the European Council presidency were encapsulated within the motto: “Recovery, power, belonging” as he seeks a “strong, fully sovereign, and united Europe.”

France’s aim was “to move towards a Europe that is powerful in the world, free in its choices and in charge of its own destiny,” Macron said at a news conference in Paris.

France takes on the rotating presidency as Belarus stands accused of engineering a refugee crisis on EU borders, amid global calls for a tougher stance on China over human rights issues, during renewed tensions with Russia over Ukraine, and as post-Brexit relations with the UK — not least Franco-British ties — become more and more strained.

Macron on EU budget
The French president said it was possible the bloc would need to go beyond the initial €750-billion coronavirus recovery package.

Macron, speaking a day before hosting Germany’s new Chancellor Olaf Scholz, said he would use France’s six-month presidency to convene an extraordinary summit of the bloc’s 27 member state leaders in Paris, on March 10 and 11..

To be held just a month before France’s presidential election, Macron said the EU gathering would help define a new European growth model in the wake of the pandemic.

Germany’s Scholz supported the original COVID stimulus package but he is wary of any joint borrowing mechanism becoming permanent.

Macron also said the new budget rules must help boost investments in the digital sector. “For that we must start building a budgetary and financial framework that is credible, simplified and transparent,” he said.

One aspect, he stressed, will be discussing whether budget stimulus is enough, while also defining whether some national investments can be allowed to go beyond the bloc’s allowance.

Macron also believes the EU should try to work towards a common, decent EU minimum wage.

Macron on the UK government
Meanwhile, relations with the UK remain strained over fishing rights, migration and security because the British government cannot be trusted, Macron said.

“The problem with the British government is that it does not do what it says,” Macron said, albeit swiftly adding how much he “loved Britain” and “its people.”

But “I have an overwhelming desire to have a [British] government that wants to works with us in good faith,” Macron said.

Regarding recent tensions over migrant crossings and a row over the granting of British fishing licences to French fishermen, Macron said he wanted the issues resolved before a Paris-imposed deadline on Friday, even though London says it is not working to such a timetable.

Referring to the UK’s part in arranging the sale of US-designed submarines to Australia at the expense of French ones, Macron said this was “not the most obvious sign of friendship,” before adding that this formulation was an “understatement.”

Last month 27 people drowned as they crossed the Channel, heading to Britain from France, and Macron said the UK’s policies were to blame, suggesting Britain’s economic model was based on illegal labor.

Macron on Russia
Macron said he planned to hold a meeting next week with Russian President Vladimir Putin “online” as he seeks reassurances over the Kremlin’s intentions in and around Ukraine.

The French president also said he would be speaking next week with his Ukrainian counterpart, Volodymyr Zelenskyy.

Tensions between the EU and Russia have escalated in recent months amid reports of Russia amassing troops near its border to Ukraine. This is further compounded by Moscow’s close relationship with Minsk, with Brussels accusing Belarusian leader Alexander Lukashenko of engineering a migration crisis aimed at destabilizing the bloc.

Macron on Beijing Winter Olympics diplomacy
Macron also highlighted the need to avoid “politicizing” sport ahead of the Beijing Winter Olympic Games, which are set to begin on February 4 — indicating that the EU might not be following the diplomatic boycott of the Games.

Several countries have said they will not be sending officials to the event in the Chinese capital, but Macron said he was “in favor of action that has a useful outcome.”

“To be clear: You either have a complete boycott, and not send athletes, or you try to change things with useful actions.”

Canada is the latest country to announce a diplomatic boycott of the event, joining Australia, Britain and the United States in doing so. China has described the boycotts as “political posturing” and said the countries who opt for this policy will “pay the price.”

Source: https://www.dw.com/en/emmanuel-macron-slams-uk-government-as-he-sets-french-eu-presidency-agenda/a-60073593

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Vehicles enter the Port of Dover, following the end of the Brexit transition period, in Dover, Britain, January 4, 2021. REUTERS/Toby Melville/Files

LONDON, July 9 (Reuters) – Britain’s biggest port said that post-Brexit disruption could return to Dover and slow trade when holidaymakers head for Europe this summer so the government must urgently reconsider funding redevelopment to prevent long-term damage.

Britain’s passage out of the European Union was eased by a lack of tourists driving to France during the pandemic, enabling port staff to process the additional paperwork for trucks that is now required to access Europe and keep goods moving.

But the government dropped a travel quarantine requirement for fully vaccinated Britons on Thursday, potentially opening up holiday routes and increasing the number of vehicles that could descend on the southwest port in the summer. read more

Doug Bannister, CEO of the Port of Dover, told Reuters the site had managed the switch to full customs checks well so far after Britain left the trade bloc at the end of 2020.

“That’s because we haven’t seen the demand for tourists coming from our facilities, as we would normally expect to see,” he told Reuters on a bright sunny day as a ferry departed for Calais.

“It’s at those points in time when the pressure on the total system increases.”

In 2019, some 2.4 million trucks used the Dover port, along with 2 million tourist cars and 74,000 coaches.

Dover has modelled the impact of a return of passenger cars to the port, and Bannister said there would be challenges if it happened quickly. “There will be longer transaction times and more processing,” he said.

British industry had warned in the run-up to Brexit that the UK’s supply chains could be strained to breaking point, with even the government saying some 7,000 trucks could back up from Dover if they failed to fill out paperwork correctly.

Instead, a December rush to stockpile goods in the country, which led to 20-mile queues outside Dover at the time, meant trade dropped off in January and enabled manufacturers and logistics groups to adapt to the new demands.

Our Standards: The Thomson Reuters Trust Principles.

Source: https://www.reuters.com/world/uk/exclusive-brexit-disruption-may-return-with-summer-tourists-dover-chief-says-2021-07-09/?rpc=401&

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The post-Brexit fallout came faster than many had expected. On January 4, the first trading day of 2021, almost €6 billion of EU share trading left London for other European capitals.

Then earlier this month came the news that Amsterdam had overtaken London as Europe’s biggest share trading centre, as daily volumes fell sharply in the City and surged in the Dutch capital.

In 2019, when the United Kingdom was still inside the European Union and its single market, 43% of trading in EU stocks took place in the UK. The first few weeks of this year have seen the proportion plunge to just 4%, according to analysis by the think tank New Financial.

The City’s commanding position on the global financial stage is not in doubt — but recent events in Europe raise questions as to how far the balance of power may shift from London to other capitals.

“You can lose liquidity very quickly, and finance is very adaptive,” says Nicolas Véron, Senior Fellow with the Brussels-based Bruegel think tank and the Peterson Institute for International Economics in Washington. “So the fact that London has so much liquidity and has had so much liquidity in recent times doesn’t mean that liquidity will stay there.”

“Basically the established position of a financial centre is not to be taken for granted going forward, if the conditions that created that position are no longer there,” he told Euronews.

Amsterdam’s post-Brexit boost

The sudden flight in trading activity is the most striking example of financial sector movement from the UK to the EU since the end of the post-Brexit transition period at New Year.

But Amsterdam is picking up business from London in other areas too. Analysis by data provider IHS Markit shows a shift in euro-denominated derivatives trading to the Dutch capital, with the figures showing the UK losing market access to the EU in nearly all categories.

The Netherlands has reported a general drop in inward foreign investment in 2020 due to the pandemic. But so-called “Brexit companies” — UK firms seeking to offset disruption and extra red tape by setting up operations in the EU — are an exception.

Annual results published on February 18 by Invest in Holland and the Netherlands Foreign Investment Agency reported an increase in the number of such companies focusing on the Netherlands.

Nearly 80 made a partial move last year and the NFIA says it is talking to 550 about relocation or expansion — including in the Dutch financial sector.

“Before we start becoming euphoric about this, Brexit is not good for the Netherlands… In the end, the Netherlands has lost their second trading partner,” says NFIA spokesman Michiel Bakhuizen. Nevertheless, he told Euronews, the country is attractive for financial companies as it helps offer solutions to Brexit-related problems.

“So for instance, when we talk about traders or FinTech companies, we have a multilingual, highly skilled workforce, we have the right infrastructure, both in terms of travelling in and out of the country to direct destinations in and outside of Europe, close digital connections with a fast network in and around specifically Amsterdam, and a very good working and living environment.”

Sunlight is reflected off a building onto a bicyclist in Amsterdam’s Zuidas, or southern axis, business district, October 30, 2013.AP Photo/Peter Dejong, FILE

The EU’s specialist cities

Research by New Financial suggests that more than 400 UK-based financial services firms “have moved something somewhere to the EU in response to Brexit”. Of these, 128 have chosen Dublin, while Paris has attracted 88, Luxembourg 84, Frankfurt 56, Amsterdam 47, and Brussels 10.

The think tank’s founder and Managing Director William Wright says the relocations reveal a clear tendency for cities to specialize across different financial sectors.

“The vast majority of the relocations to Dublin are in asset management and to a lesser extent, alternative investments. The vast majority of firms moving to Frankfurt are banks, or investment banks; the vast majority of firms moving to Amsterdam, exchanges, trading platforms, brokers,” he told a Peterson Institute panel discussion.

“Paris is the only one that doesn’t have that deep-sector profile. It’s already the largest centre in terms of insurance and asset management in the EU, and it would like to build on both of those, but the distribution of firms that are choosing Paris is much broader.”

Such trends suggest no particular race among European cities to dominate the scene or become the continent’s number one financial hub post-Brexit.

“The reason why not all will gather in one place is very simple: there isn’t really an incentive for that,” adds Véron. “There is a lot of activity to absorb and it’s more economical for firms to scatter it across different centres than all go to the same place and have a kind of overheating effect.”

A picture taken on February 17, 2021 in Suresnes, shows the buildings in the business district of La Defense near Paris. STEPHANE DE SAKUTIN / AFP

The UK’s battle for ‘equivalence’

UK firms had long known that as a result of Brexit they stood to lose full “passporting rights”, stripping away the blanket access to operate in Europe they had before.

However, so far the EU is also refusing to grant the UK a much lesser form of access known as “equivalence” — given when Brussels considers a third country’s regulation to be as robust as its own. Being deprived of this further hinders the City’s ability to trade unhindered in Europe. Instead, UK firms have to comply with individual states’ requirements.

Financial services were never scheduled to be part of the post-Brexit trade agreement, and duly took a back seat while negotiations focused on the likes of fishing rights.

In the deal itself, both sides merely agreed to agree at a later stage. This did not prevent Boris Johnson from putting a typically shiny gloss on its provisions.

“There’s some good language about equivalence for financial services, perhaps not as much as we would have liked, but it is nonetheless going to enable our dynamic City of London to get on and prosper as never before,” the British prime minister said on Christmas Eve, the day the agreement was struck.

The “good language” he referred to, set out in an annex to the main deal, amounts to no more than a commitment to cooperate on regulation and preserve financial stability. By March 2021 both sides aim to agree a “Memorandum of Understanding” to establish a framework, but expectations as to the content are low.

Brussels has control

The UK has granted the EU equivalence, meaning that EU banks can operate in UK markets. But whether the EU does likewise will be entirely up to Brussels.

The European Commission’s assessment of the Brexit deal bluntly says the EU “will consider equivalence (decisions) when they are in the EU’s interest”. So far it has granted the UK just two temporary agreements from a possible 39.

The EU’s chief Brexit negotiator Michel Barnier has said since that more clarification is needed on British plans. National authorities will be on the lookout for UK firms seeking to get around new restrictions, he added.

“I think there is a widespread narrative in the UK that there will be somehow a negotiation about financial services, but I don’t see that happening,” says Bruegel’s Véron. “Equivalence, as the Joint Declaration (attached to the Brexit trade deal) made extremely clear, is not a negotiation, equivalence is a unilateral decision.”

And, he adds, he does not expect that to come any time soon. “The one thing that has a deadline in terms of the equivalence process is equivalence on clearing houses which only runs till May 2022, so the Commission must decide to extend or not, that’s a very significant market segment. Otherwise there’s nothing in the pipeline,” he told Euronews.

In a speech this month, Bank of England Governor Andrew Bailey said it would be unfair of the EU to impose tougher rules on the UK than it has on other non-EU countries, insisting that Britain could not accept becoming a “rule-taker”.

There have also been warnings that if the EU is too hard on the UK, the main winners may not be on the continent but in other global financial centres such as New York.

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“How fitting it is to be in the Land of the Rising Sun to welcome in the dawn of a new era of free trade,” British International Trade Secretary Liz Truss told reporters at a signing ceremony in Tokyo.

Appearing with Japanese Foreign Minister Toshimitsu Motegi, Truss called the agreement a “landmark” as the first major trade deal for Britain since it returned as an independent trading nation.

The deal, estimated to boost British trade with Japan by £15 billion (US$19.5 billion), will also make it easier for British companies to operate in Japan.

Financial services make up Britain’s biggest export to Japan, now at 28 percent. English sparkling wine, made-in-Britain coats, and shoes, Stilton cheese, as well as pork and biscuits from Britain, will become cheaper in Japan.

Motegi said the bilateral deal ensures continuity from the preceding European agreement while adding new areas for cooperation such as e-commerce and financial services.

Source: AP/dv

Source: https://www.channelnewsasia.com/news/business/japan-britain-uk-free-trade-deal-fta-brexit-13349464

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