20 November 2018

A unionist assessment of May’s deal

By William Burstow

Just outside the Commons library is a bust of Lord Carson – the famous Irish Unionist. While reading the Draft Withdrawal Agreement (DWA) I could not help but think about what the former Attorney General would think of the proposed backstop. It is, of course, impossible to say, and it would be wrong to put words into his mouth.

What is clear is that he understood the importance of the economic, cultural, and constitutional links across the Irish Sea and the value of the Union to making them work best for the peoples across the British Isles.

Unionists today also understand the importance of the interdependence of all parts of the United Kingdom, and the value of how they orient themselves to each other and to the capital.

This point highlights the key test for the proposed backstop – does it maintain, now and in the future, the orientation to London and connection to the three other parts of the United Kingdom of an integral part of the country?

It is hugely disappointing, on a plain reading of the Protocol relating to Northern Ireland and the related Annexes in the DWA, that it fails this key test.

The proposed backstop represents an existential threat to the United Kingdom as it sets Northern Ireland in a different regulatory structure than the other parts of the UK and therefore orientates Northern Ireland away from London and the rest of the UK setting it on an escalator out of the Kingdom.

Importantly, this is not just a matter of difference in parts of the UK. There is an argument for local variation and devolution of powers so that the state works effectively and efficiently for citizens. As long as it does not erode the structural integrity of the UK and the ability to change the distribution of powers across the country.

Unfortunately, this does not apply to the DWA as it is the potential basis of an International Treaty that the UK cannot unilaterally withdraw from without the consent of the other party, or via international arbitration.

Leaving the backstop – Disputes

Article 20 of the Protocol sets out how we could negotiate or appeal for our exit from the backstop, it is not a unilateral notice the way Article 50 of the Treaty on European Union is and details how the Joint Committee overseeing implementation of the DWA will meet to consider the petition to leave the backstop, in whole or in part.

This wording is important, because it would mean that there is provision to both pair down specific sections of the backstop as agreements are made and is sensible. However, it will also mean that the Britain can petition to leave the UK wide customs union and leave Northern Ireland alone in the backstop – not that it would be politically acceptable to do so.

The article also allows for consultative opinions from the institutions of the Good Friday Agreement. Presumably this means the Executive and Assembly, but also perhaps the North South Ministerial Council, the British-Irish Council, and the British-Irish Intergovernmental Conference. It is an interesting question as to whether it would ever be politically acceptable to the majority remain Assembly and a shared Executive to see the end of the backstop.

The Joint Committee (JC), looks to be made up of two people – one from the UK and one from the EU with nominated alternates when required.

If there is no resolution on leaving the backstop via the JC within six months then any attempt to leave the backstop would go to international arbitration via the Permanent Court of Arbitration (Article 170).

Articles 164 through to 181 of the main portion of the DWA sets out the dispute mechanism for the whole agreement and contain the detail on the arbitration panel that would be used after the JC.

The Arbitration panel will be constructed of five people – two nominated by the UK, two nominated by the EU with one nominated by both, selected from a pre-agreed list of 25 people – ten from the UK, ten from the EU and five nominated by both.

The chairman of the panel is elected by the panel from the five individuals nominated by both parties. If no one is elected within five days, then the Secretary General of the Permanent Court of Arbitration will make the selection for the panel. The process for the above is set out in Article 171.

The panel can take 12 months to rule, once created. However, if there is urgency the UK and the EU can ask for a ruling in six months, according to Article 173.

As a final side point, if the dispute is not over withdrawing from the backstop the whole dispute process above will not apply if the dispute is about the interpretation of EU law, that will be decided by the CJEU (Article 174).

Article 6 – The Backstop in two parts

The proposed backstop is constructed of different parts. First, as set out in Article 6(1), there is a single customs territory that is made up of ‘the Union’ (the EU) and the United Kingdom. A customs union between the two which, while not perfect, is something unionists will broadly accept.

Problems arise with the second part of the proposed backstop, which sets out active steps to ensure that, in addition to being in the single customs territory, Northern Ireland will abide by “legislation as defined in point (2) of Article 5 of Regulation (EU) No 952/2013 of the European Parliament and of the Council”.

This means that Northern Ireland alone will have to abide by the;

  • Union Customs Code and all its supplementary provisions
  • The Common Customs Tariff
  • Legislation on customs relief,
  • All international treaties signed by the EU relating to customs

In addition, the 291 different regulations set out in Annex 5 of the Protocol will apply to Northern Ireland only and Article 30 & Article 110 of the Treaty on the Functioning of the European Union (TFEU) will also apply to Northern Ireland only.

Article 30 of the TFEU prohibits customs duties imposed on imports and exports between states in the EU customs union, and any charges having an equivalent effect and Article 110 of the TFEU regulates for the free movement of goods rules that deliver the Single Market in Goods.

In summary, the effect of Article 6 (2) is that Northern Ireland will be the only part of the UK that abides by the EU Customs Code, Common Customs Tariff, is part of the Single Market in Goods and legislation of the EU that relates to the above.

The Protocol goes on in Article 8 to apply Articles 34 and 36 of the TFEU to Northern Ireland alone – ensuring that EU goods can come into Northern Ireland without restriction.

Along with the Customs code and tariff, and the Single Market in Goods, Articles 9 to 12 apply a wealth of EU regulation to Northern Ireland alone on;

  • VAT and excise,
  • Agriculture and Environment
  • Single Energy Market
  • State Aid

The regulation is detailed in Annex 5, 6, 7 and 8 of the Protocol, which is the 291 portions of EU law in Annex 5 in addition to an extra 80+ provisions in 6,7, & 8 that are Northern Ireland only.

The collective effect of the above articles is that a regulatory goods border is erected down the Irish Sea – an internal border in the UK – something the PM recently stated that no PM could accept.

In practical terms this means that any good moving East from West across the Irish Sea will have regulatory checks applied to it. A change that has the potential to harm Northern Ireland’s economy due to regulatory barriers limiting and curtailing inward trade from within the UK. This is prioritising a trading relationship with the EU above the vastly larger trading relationship Northern Ireland has with the rest of the UK – a very far cry from the best of both worlds narrative.

In addition to the measures to place Northern Ireland in a Single Market for Goods, Article 15(1) details, in a convoluted way, that Northern Ireland alone is in the EU customs territory.

Furthermore, buried deep within Annex 2 of the Protocol are unilateral remedial measures that the EU can take within the UK to secure the integrity of their market. This is set out in Article 6 of Annex 2, whereby the EU can deepen again the Irish Sea border with measures to “impose tariffs or other restrictions on the movement of relevant goods into or out of the customs territory of the Union.”

Protecting the United Kingdom?

Much of what has been discussed thus far are active measures to fulfil Article 49 of the December 2017 Phase One Report. It is detailed and comprehensive, taking measures to prevent any checks at the land border between the Republic of Ireland and the United Kingdom today and in the future.

It is not unreasonable to think next about the specific measures in the Protocol to fulfil Article 50 of the December Report. This is set out in Article 7 of the Protocol.

It details the intention of the UK and the EU to make the “best endeavours” to facilitate trade between Northern Ireland and the rest of the UK. This is not, like measures to keep trade open at the land border, detailed with active procedures in the Protocol.

This speaks to a real asymmetry in the Protocol. All sections in the Protocol regarding best endeavours of parties and statements that lay out that the DWA will not harm the internal UK economic and constitutional structures are not active measures and are not backed by further legislation.

Because of this asymmetry, the practical outcome of the active, comprehensive, and regulated measures to keep the border open between the Republic of Ireland and the UK is that it will considerably hinder East-West trade across the Irish Sea and hamper best endeavours to facilitate trade between Northern Ireland and the rest of the UK.

This makes the Protocol hugely difficult, even for pragmatic, Good Friday Agreement supporting unionists like myself. Those who want a deal that works economically for British businesses, works constitutionally for the whole UK, and allows for the bilateral North South co-operation in Strand Two of the Good Friday Agreement will find it impossible to draw the conclusion that the DWA does all of this.

I would be overjoyed – sincerely – if my assessment is wrong. I would welcome a detailed explanation from the Prime Minister as to why, in the backstop, there will be no regulatory goods border between the rest of the UK and Northern Ireland as a result of the provisions outlined above. But if it becomes clear that there will be an internal border in the UK then it leaves unionists of all parties and none with a choice – prioritise the long term strategic, economic, and constitutional interests of the whole United Kingdom, or sign up to the Prime Minister’s transition deal.

William Burstow is a Senior Parliamentary Assistant. This article represents the author's own views.