0:00:20 > 0:00:23Good morning. Can I, we have of the committee, express a very warm
0:00:23 > 0:00:31welcome to our three witnesses today. Professor Michael Dougan,
0:00:31 > 0:00:40University of Liverpool. The director of UK in a changing Europe.
0:00:40 > 0:00:45And Stephen Booth, director of policy and research, open Europe.
0:00:45 > 0:00:52Thank you for agreeing to come along today. Can I begin with this
0:00:52 > 0:00:59interesting question of full alignment of the UK and the EU. In a
0:00:59 > 0:01:05way that was the most significant part of phase one because it enabled
0:01:05 > 0:01:10the 27 to say, right, that sufficient progress, off we go. Can
0:01:10 > 0:01:14I start by asking you what is your understanding, briefly, we have got
0:01:14 > 0:01:18a lot of questions to ask in the time, succinct answers would be
0:01:18 > 0:01:21really helpful, what is your understanding of what it is the
0:01:21 > 0:01:28government has committed to in what they described as the fallback? In
0:01:28 > 0:01:32other words, if there is no deal, no other method, there is a clear
0:01:32 > 0:01:35commitment in the deal to this full alignment that ensures there is no
0:01:35 > 0:01:42border? Can I start with you, Professor Dougan?Sure. Thank you
0:01:42 > 0:01:47very much for the invitation. Would you like me to comment specifically
0:01:47 > 0:01:50on the context of Northern Ireland, the passage of the joint report that
0:01:50 > 0:01:59deals with Northern Ireland?Indeed. Absolutely.I think there are four.
0:01:59 > 0:02:03There are four questions, I think, which arise out of that part of the
0:02:03 > 0:02:07text and the joint report of the fourth option, unilateral
0:02:07 > 0:02:11commitment, full alignment, with certain rules of the single market
0:02:11 > 0:02:18and the Customs Union. It is only certain rules. The text gives a few
0:02:18 > 0:02:23indicative fields. They talk about the all Ireland economy, North South
0:02:23 > 0:02:27cooperation and the Good Friday Agreement. But each of those is open
0:02:27 > 0:02:30to interpretation. So we are not quite sure yet what scopes of
0:02:30 > 0:02:34cooperation we are talking about. It is clearly not the full single
0:02:34 > 0:02:41market the Customs Union. The phrase full alignment may not have a
0:02:41 > 0:02:45certain political resonance, it may have political symbolism, but it is
0:02:45 > 0:02:50very difficult for me as a constitutional EU trade lawyer to
0:02:50 > 0:02:53translate it into something more concrete and precise. The single
0:02:53 > 0:02:57market and the Customs Union are built on different combinations of
0:02:57 > 0:03:00legal techniques, mutual recognition, harmonisation,
0:03:00 > 0:03:05surveillance and supervision. They differ from sector to sector, they
0:03:05 > 0:03:08change over time. It is difficult for me to get a sense of what full
0:03:08 > 0:03:12alignment means maps onto the actual complexities of the single market
0:03:12 > 0:03:16and the Customs Union. I think the third issue is that full alignment
0:03:16 > 0:03:21is not clear territorially, whether it is intended to apply only to
0:03:21 > 0:03:26Northern Ireland are to all of the UK, whether that might change in
0:03:26 > 0:03:31different situations. For me, it is interesting in that the choice seems
0:03:31 > 0:03:35to be left to the Northern Ireland institutions rather than the UK
0:03:35 > 0:03:38government. The stereo -- territorial scope of full alignment
0:03:38 > 0:03:42is not necessarily that clear. The fourth issue is this is a unilateral
0:03:42 > 0:03:46offer. This is the UK saying unilaterally we will fully align
0:03:46 > 0:03:52ourselves with certain rules of the single market and the Customs Union.
0:03:52 > 0:03:56That can limit the roles of another territory and don't me very much in
0:03:56 > 0:04:00international trade, because without the institutions, the processes, the
0:04:00 > 0:04:04structures and networks that underpin the interaction of rules
0:04:04 > 0:04:07while remaining a unilateral decision to mimic rules, they don't
0:04:07 > 0:04:13give you any greater market access or deal with customs barriers. It is
0:04:13 > 0:04:18interesting that the UK government in both of its -- in its partnership
0:04:18 > 0:04:22paper in this position paper on Northern Ireland, explicitly say
0:04:22 > 0:04:26that unilateral solutions will not work. We need agreed solutions
0:04:26 > 0:04:30because unilateral solutions will not work. So to that extent the
0:04:30 > 0:04:34joint report is a departure from what we knew from the future
0:04:34 > 0:04:40partnership paper and the position paper.That is extremely helpful.
0:04:40 > 0:04:44Just one more point. If it only applies to certain sectors of the
0:04:44 > 0:04:53economy, the all Ireland economy, then how can that be consistent with
0:04:53 > 0:04:58what is also written, clearly, in the phase one agreement, that there
0:04:58 > 0:05:04will be no checks, no infrastructure at all? The only way you can honour
0:05:04 > 0:05:09that commitment is if it applies to all part of the economy. Basically,
0:05:09 > 0:05:12all movements between Northern Ireland and the Republic, and the
0:05:12 > 0:05:17Republic and Northern Ireland.Isn't that the case? It may be helpful if
0:05:17 > 0:05:23I give you my summary review of the position on Northern Ireland. At
0:05:23 > 0:05:30least the customs part. For me it is just a forge. -- for it's. The
0:05:30 > 0:05:35position hasn't changed. We are promising irreconcilable things to
0:05:35 > 0:05:38different groups of people. We don't know how to solve it. We have come
0:05:38 > 0:05:42up with a form of words that people feel they can buy into to enable
0:05:42 > 0:05:49progress. But it is actually very difficult for me to see how these
0:05:49 > 0:05:54solutions are carrying the situation forward. For me this is just a
0:05:54 > 0:05:57postponement of the argument until the New Year. And in certain
0:05:57 > 0:06:00respects it could make the resolution of the situation worse,
0:06:00 > 0:06:05or at least more difficult, because by putting it down in writing, by
0:06:05 > 0:06:07giving concrete commitments, by generating expectations among
0:06:07 > 0:06:11different groups of people that these commitments are somehow
0:06:11 > 0:06:15binding are guaranteed or unenforceable, we are entrenching an
0:06:15 > 0:06:19intractable problem and making the position is potentially more
0:06:19 > 0:06:22difficult to come to a compromise, rather than offering clear
0:06:22 > 0:06:27solutions. For me, the Northern Ireland selection is kicking it into
0:06:27 > 0:06:32the New Year without any clear resolution.Thank you.I will just
0:06:32 > 0:06:37add three things to what Michael said. This is a clear commitment. It
0:06:37 > 0:06:41is. The legal status of this document is open to debate. It is a
0:06:41 > 0:06:45clear commitment in a document that may not be binding. What status that
0:06:45 > 0:06:51gives it, heaven alone knows. To pick up on the points you made about
0:06:51 > 0:06:56scope, the other thing the report stresses is the need to maintain
0:06:56 > 0:06:59integrity through the single market. It is difficult to see how that
0:06:59 > 0:07:03happens if you're picking off bits with regard to the all Ireland
0:07:03 > 0:07:06macroeconomy. There is a further attention to those outlined by
0:07:06 > 0:07:10Michael. The third point is a unilateral offer. It seems to me the
0:07:10 > 0:07:14missing element is the question of adjudication. That lurking in the
0:07:14 > 0:07:22text of this document is we will be alignment trusts. The big question
0:07:22 > 0:07:27is who gets to -- the sake? Wrote what is the form of legal
0:07:27 > 0:07:32adjudication? We have a very good institution in Luxembourg that does
0:07:32 > 0:07:36it already, if you are interested. I think that has been postnatally to
0:07:36 > 0:07:40one side as well. Nobody in International Trade takes the other
0:07:40 > 0:07:51parties -- party pots word for it. -- party's.Thank you.I agree with
0:07:51 > 0:07:55much of what has been said. There is a risk of trying to analyse this to
0:07:55 > 0:08:02rationally when basically this is a political forge and it's hard to
0:08:02 > 0:08:09find much meaning. If there is no deal, there is no deal. How a
0:08:09 > 0:08:12unilateral declaration from the UK can somehow keep the UK in the
0:08:12 > 0:08:16Customs Union for practical purposes, to move goods across the
0:08:16 > 0:08:20border, I don't see how it achieves that. You can look at that from
0:08:20 > 0:08:25either way. From the EU side. What does this commitment mean if the EU
0:08:25 > 0:08:31tries to bank this deal? How does that work? I do think that this is,
0:08:31 > 0:08:35yes, it's a very political section of the document which effectively
0:08:35 > 0:08:43means very little, I think.Thank you.Pat McFadden. I want to keep
0:08:43 > 0:08:51going with this line of questioning, if I can. Professor Dougan, you
0:08:51 > 0:08:55described it as a postponement a couple of minutes ago. If things are
0:08:55 > 0:09:00not clear, I just want to ask a few questions about what we need to
0:09:00 > 0:09:05become clear in the second phase of this to understand it better. First
0:09:05 > 0:09:12of all, on full alignment, it seems that the UK government is defining
0:09:12 > 0:09:17this as the six areas for North South cooperation stemming from the
0:09:17 > 0:09:25Good Friday Agreement. Tourism, transport etc. Significantly, those
0:09:25 > 0:09:32in six areas do not cover import and export of goods and services. So the
0:09:32 > 0:09:37first question I would like to ask is, is it your understanding that
0:09:37 > 0:09:42that is also the EU and Irish government view of what full
0:09:42 > 0:09:49alignment means? And if their view is different, what is it that needs
0:09:49 > 0:10:01to be clarified about this in the second phase?
0:10:01 > 0:10:09For me, the north South cooperation part of the phrasing in the joint
0:10:09 > 0:10:11report is a relatively clear criterion in the sense that the two
0:10:11 > 0:10:15sides have been drawing up a list of areas that are the subject of
0:10:15 > 0:10:20North-South co-operation, underpinned by EU law and policy. It
0:10:20 > 0:10:25covers health and energy etc. For EV much more ambiguous criterion which
0:10:25 > 0:10:30is listed in the joint report is supporting the all Ireland
0:10:30 > 0:10:32macroeconomy. This could mean anything. This could mean
0:10:32 > 0:10:39everything, every part of the single market and the Customs Union in its
0:10:39 > 0:10:42entirety, or it could mean just single parts and selected parts, and
0:10:42 > 0:10:46we have no real idea what is meant. When I mentioned earlier in response
0:10:46 > 0:10:53to the question, these criteria are very malleable, open to
0:10:53 > 0:10:58interpretation. They don't tell us very much at all. Especially that
0:10:58 > 0:11:03criterion, the all Ireland economy, protecting the all Ireland economy.
0:11:03 > 0:11:08That can be as broad or narrow as you wanted to be.In the end we will
0:11:08 > 0:11:13need a legal text, the end of phase two. What in your view needs to be
0:11:13 > 0:11:20clarified? If this is all constructive ambiguity, what needs
0:11:20 > 0:11:28to be clarified so that we know at least what it leads to?I can give a
0:11:28 > 0:11:31direct answer. Somebody needs to be told that there are going to be very
0:11:31 > 0:11:35disappointed with this agreement. I think that is the actual answer that
0:11:35 > 0:11:38needs to be conveyed. It is worth bearing in mind the government sets
0:11:38 > 0:11:45out a 3-judge approach. First of all, these issues could be solved by
0:11:45 > 0:11:49the special partnership. That is problematic as things stand. First
0:11:49 > 0:11:52of all because we don't know what the special partnership may look
0:11:52 > 0:11:59like. The government's idea has not gone down terribly well, are
0:11:59 > 0:12:04terribly credibly either at home or abroad. And the timescales don't
0:12:04 > 0:12:07necessarily match up with the imminent problem of the Irish
0:12:07 > 0:12:13border. The deep and special partnership could only be sorted in
0:12:13 > 0:12:17six or seven years. The next position is the special solutions
0:12:17 > 0:12:24agreed, not unilateral, unique to the situation of Ireland and
0:12:24 > 0:12:27Northern Ireland. Given again what we know from the government position
0:12:27 > 0:12:30paper on Northern Ireland, these are only building on the deep and
0:12:30 > 0:12:34special partnership. These are additional things on top. If we
0:12:34 > 0:12:36don't have the deep and special partnership in place, it's difficult
0:12:36 > 0:12:41to see how the government has yet put on the table credible solutions
0:12:41 > 0:12:46specific to Northern Ireland. This is a default position. As a default
0:12:46 > 0:12:50position it doesn't tell us very much at all, especially because of
0:12:50 > 0:12:56its unilateral nature. The problem is that we have irreconcilable
0:12:56 > 0:12:59promises to different groups of people, and somebody is going to be
0:12:59 > 0:13:02disappointed. I think it is a matter of identifying who is going to be
0:13:02 > 0:13:06the most disappointed by the time of 12 months from here.
0:13:06 > 0:13:12I will ask your colleagues if they want to come in.The Irish
0:13:12 > 0:13:16government want an invisible border. You have to decide which part of the
0:13:16 > 0:13:20United Kingdom stays in the single market and the Customs Union. That
0:13:20 > 0:13:24is something it fails to do. That is a question of deciding which
0:13:24 > 0:13:29constituency you want is -- to disappoint with the outcome.I'm not
0:13:29 > 0:13:33sure that is entirely true. I think the only way this can be solved is
0:13:33 > 0:13:38through continued postponement. I think the way that this process
0:13:38 > 0:13:42might unfold, May allow this to continue for quite some time. If we
0:13:42 > 0:13:46do enter a transitional instrumentation phase in which the
0:13:46 > 0:13:49UK effectively replicates the single market and the Customs Union, we
0:13:49 > 0:13:55will face this exact same question at the end of 2018, early 2019, and
0:13:55 > 0:14:00the question is, is either side going to blink? We have got to the
0:14:00 > 0:14:03point now virtually the EU was prepared to move forward with a
0:14:03 > 0:14:10postponement and Ireland as well, the UK too, given the expectation is
0:14:10 > 0:14:14we're not going to have this final trade agreement on the future
0:14:14 > 0:14:18partnership, signed, sealed and delivered by March 2019, I can see
0:14:18 > 0:14:23every likelihood that the continue this into the transition period. And
0:14:23 > 0:14:29I think at that point it may start to become easier to focus on a
0:14:29 > 0:14:33narrow scope of the particular issues which both the Republic of
0:14:33 > 0:14:39Ireland, the rest of the EU and the United Kingdom feel they need to
0:14:39 > 0:14:42keep open, and focus on the alignment where you can keep an open
0:14:42 > 0:14:46border between North and South. What I think we will be living with this
0:14:46 > 0:14:54question for a great deal of months and years ahead.
0:14:54 > 0:14:58The other side of this is the following paragraph in that joint
0:14:58 > 0:15:03document published the other week, also said that there should be no
0:15:03 > 0:15:06new regulatory barriers between Northern Ireland and the rest of the
0:15:06 > 0:15:14UK as a result of this. There's been a lot of attention this means
0:15:14 > 0:15:18north-south. I want to ask you about the implications then for that
0:15:18 > 0:15:22second part of this. Do you think, could you spell out what you think
0:15:22 > 0:15:26they are, in terms of what full alignment will mean for the whole of
0:15:26 > 0:15:32the UK? With the rest of the UK on this - broadening out from Northern
0:15:32 > 0:15:37Ireland? And do you think that's been fully understood in political
0:15:37 > 0:15:45debate here?It is a really, really interesting question. We're starting
0:15:45 > 0:15:51to talk a lot about the UK internal market, this sort of new concept
0:15:51 > 0:15:55which has emerged since 2016. But we don't actually know very much about
0:15:55 > 0:15:59what that UK internal market consists of, how it will be
0:15:59 > 0:16:06organised and so on. In a way, this joint report - bleakly gives us
0:16:06 > 0:16:10first glimpses into what the market might look like. One could say this
0:16:10 > 0:16:15is the tail wagging the dog. In many respects it is. I can tell you what
0:16:15 > 0:16:18I learned about the UK internal market from the joint report. In so
0:16:18 > 0:16:24far as full alignment applies to the UK as a whole, then, that's
0:16:24 > 0:16:29obviously the easiest way to ensure there are no regulatory barriers
0:16:29 > 0:16:34between Northern Ireland and GB. It guarantees full market access for
0:16:34 > 0:16:39Northern Irish businesses into GB. In so far as the full alignment only
0:16:39 > 0:16:43applies to Northern Ireland because the Northern Irish institutes have
0:16:43 > 0:16:48agreed that should be the case and doesn't apply to GB, then obviously
0:16:48 > 0:16:52there can be no new regulatory barriers for Northern Irish
0:16:52 > 0:16:58businesses going into GB, but there will potential I will be regulatory
0:16:58 > 0:17:00barriers for GB businesses going into Northern Ireland. What that
0:17:00 > 0:17:05tells us I think in a way is that the model of the internal market
0:17:05 > 0:17:10which is emerging - bleakly from this joint report, A, makes some
0:17:10 > 0:17:14very striking assumptions about the confidence of the UK Government to
0:17:14 > 0:17:17deal with devolved matters, because the UK Government, in so far as,
0:17:17 > 0:17:23full alignment covers the hole of the UK, it's presupposing confidence
0:17:23 > 0:17:28to regular sectors which would belong in the devolved fields of
0:17:28 > 0:17:33competence. The UK Government is assuming it has the competence to
0:17:33 > 0:17:36determine the trade between the nations of the UK. And from what we
0:17:36 > 0:17:41can see so far it is a fairly lop-sided relationship, in that
0:17:41 > 0:17:45Northern Ireland will have a special place. Will that special place
0:17:45 > 0:17:48extend to Scotland and Wales? To other parts of England? We are
0:17:48 > 0:17:51learning lots of interesting things from this document, probably not
0:17:51 > 0:17:54intended in that way. But we are learning that the internal market of
0:17:54 > 0:18:01the UK is going to be based on a relatively extensive conception of
0:18:01 > 0:18:06the UK Government, vis a vis the devolved regions and it may be a lop
0:18:06 > 0:18:10sided market which gives certain regions greater privileges than
0:18:10 > 0:18:15others.Thank you. What I am asking really is the Irish question reverse
0:18:15 > 0:18:21engineering the type of Brexit we are going to end up with?To an
0:18:21 > 0:18:26extent. What is interesting is it gives the Irish political
0:18:26 > 0:18:29authorities to do something if they so wish and it promises unfeted
0:18:29 > 0:18:34access in one direction but not the other, which is a curious form of
0:18:34 > 0:18:40wording. I have not understood the implications of that. It is A
0:18:40 > 0:18:44symmetrical, in a sense, if you were a cynical political scientist, you
0:18:44 > 0:18:48would say you were laying the ground for some blame-shifting here. It is
0:18:48 > 0:18:51up to these authorities to take a decision as to whether or not they
0:18:51 > 0:18:55will allow certain barriers to arise. Maybe that's the plan. I
0:18:55 > 0:19:06don't know, to be honest.
0:19:07 > 0:19:11Which the Irish Government are equally concerned about is the
0:19:11 > 0:19:15border east-west, not just north-south, because of course their
0:19:15 > 0:19:22main market lies in GB and the goods which go to the EU go through GB.
0:19:22 > 0:19:30So, given what you have said so far about this being a fudge, do you,
0:19:30 > 0:19:36what barriers do you see, or what prospects do you see within this
0:19:36 > 0:19:41document that the east-west border can be, there's a guarantee of
0:19:41 > 0:19:46frictionless trade in that direction? And what implications
0:19:46 > 0:19:52does that have for regulations vis a vis the United Kingdom as a whole?
0:19:52 > 0:19:59And the EU?Well, I think the first thing to say is if the UK leaves the
0:19:59 > 0:20:02Customs Union and the single market it will not be frictionless. The
0:20:02 > 0:20:08question is how to minimise the friction. And I think, so again the
0:20:08 > 0:20:12notion of an invisible border, I think that when the UK Government
0:20:12 > 0:20:17talks about that, it is clear it wants to avoid physical
0:20:17 > 0:20:20infrastructure, but everything recognises if you are outside the
0:20:20 > 0:20:22Customs Union there'll have to be new paperwork to be done. The
0:20:22 > 0:20:26question is whether that can be done in a virtual sense rather than
0:20:26 > 0:20:29through checking everything at the border. But as you say, I think
0:20:29 > 0:20:34there are going to be areas where the UK wants to be closely ashrine r
0:20:34 > 0:20:37lined to the Customs Union, the transit of goods through the United
0:20:37 > 0:20:43Kingdom which would help Irish supporters -- exporters to export to
0:20:43 > 0:20:48the main line Europe. It would help UK exporters to help them with their
0:20:48 > 0:20:53access to the single market and the Customs Union as well. There'll be a
0:20:53 > 0:20:57mutual interest in keeping a degree of alignment on certain rules which
0:20:57 > 0:21:05facilitate trade.The Government has already said that the term full
0:21:05 > 0:21:08alignment is a flexible term. It does not mean being part of the
0:21:08 > 0:21:13single market or part of the Customs Union. There are lots of ways, lots
0:21:13 > 0:21:21of recognition, etc. So, does the commitment and in document give
0:21:21 > 0:21:25enough leeway for the Government to be able to say, look we can still be
0:21:25 > 0:21:29outside the single market, we can still be outside Customs Union and
0:21:29 > 0:21:35yet there are other ways in which we can meet the commitment?Yes, it
0:21:35 > 0:21:41does. It is what the agreement says. It says in the absence of solutions.
0:21:41 > 0:21:48So the aim now for the UK and for the rest of EU are to find those
0:21:48 > 0:21:53solutions.I am less convinced, I have to say. How you minimise
0:21:53 > 0:21:58friction because you will get friction. If we are outside the
0:21:58 > 0:22:01single market the Customs Union, there'll be friction. The other
0:22:01 > 0:22:07question is where that arises? Whether it arises Ireland or
0:22:07 > 0:22:14east-west. That is the political choice that has to be made.Can the
0:22:14 > 0:22:17fudge not be, and you talked about this being a fudge, could the fudge
0:22:17 > 0:22:26not be from the EU side, where for example they fudge some of their
0:22:26 > 0:22:30requirements for border treatment in relation to the Irish Republic?Can
0:22:30 > 0:22:35I say something quickly on that, for me, one of the problems with Brexit
0:22:35 > 0:22:39is you don't have historical comparisons. One is when Poland
0:22:39 > 0:22:47joined the EU and the Poles had a very open border with Ukraine. As a
0:22:47 > 0:22:49result western Ukraine floushished economically because there was more
0:22:49 > 0:22:54going on with the Polish economy and the Poles begged the European Union
0:22:54 > 0:22:59to be flexible when it came to a border, they said, absolutely
0:22:59 > 0:23:06rightly, this will have a very detrimental effect on the west
0:23:06 > 0:23:10Ukrainian economy. It was ignored. Showed very little in the way of
0:23:10 > 0:23:14flexibility about that. If that is the precedent, then the answer to
0:23:14 > 0:23:21your question is, no.A couple of small points and a potentially
0:23:21 > 0:23:25larger point which you might want me to talk about or you may think
0:23:25 > 0:23:29you've heard enough of me. On the issue of transit, which is very,
0:23:29 > 0:23:34very crucial, of course. They have explicitly reserved that for the
0:23:34 > 0:23:37second phase of the negotiation. They will come back to reach an
0:23:37 > 0:23:43agreement on transit itself. Second point, one of the most important of
0:23:43 > 0:23:47the borders that runs east-west, is not the border for goods or the
0:23:47 > 0:23:50border and regulation, it is the border for the common travel area
0:23:50 > 0:23:58and in a way that's the one triumph of the secretary on Ireland and
0:23:58 > 0:24:03Northern Ireland in the joint report. It is a really welcome
0:24:03 > 0:24:11thing. It is not a guarantee that the common travel area persist in
0:24:11 > 0:24:15all areas -- in all circumstances. There's work still to be done by the
0:24:15 > 0:24:19UK, by Ireland and by the UK and Ireland together to make sure that
0:24:19 > 0:24:23the conditions under which the common travel area can be preserved,
0:24:23 > 0:24:27way into the future will exist into the future. But it is a significant
0:24:27 > 0:24:31achievement. The third point is I described the
0:24:31 > 0:24:35section on the customs and regulatory border as a political
0:24:35 > 0:24:39fudge, the problem is that this is a political fudge which cannot last
0:24:39 > 0:24:42forever. Because we are going to leave the EU. There is going to be a
0:24:42 > 0:24:46border and it has to be a border of a particular type and character and
0:24:46 > 0:24:51that does need to be sorted out. So this is a fudge in the sense that it
0:24:51 > 0:24:55postpones the difficult decisions, but doesn't take away the need to
0:24:55 > 0:24:58make the difficult decisions eventually. We cannot live with a
0:24:58 > 0:25:02fudge when we actually need to have solutions. Will there be border
0:25:02 > 0:25:09checks at that border or will there not be? Your question raises wider
0:25:09 > 0:25:14issues which may come back to what Hillary talked about at the start
0:25:14 > 0:25:17about what regulatory alignment or convergence mean, not just in the
0:25:17 > 0:25:22context of Northern Ireland but in the context of the EU-UK
0:25:22 > 0:25:25relationship as a whole? There is probably a lot to be said about that
0:25:25 > 0:25:28and I don't want to go off on a monologue if you don't think it is
0:25:28 > 0:25:32the right moment. The issues of Ireland and the UK are much more
0:25:32 > 0:25:35wrapped up in the question of the future relationship between the UK
0:25:35 > 0:25:39and the EU as a whole, rather than necessarily to do with the situation
0:25:39 > 0:25:44of Northern Ireland.That ening you very much. Just a factual question,
0:25:44 > 0:25:48in the agreement it says, the UK recalls its commitment to the
0:25:48 > 0:25:52avoidance of a hard border, including any physical
0:25:52 > 0:25:56infrastructure or related checks and controls - that is very specific. Is
0:25:56 > 0:26:03there any border between the EU 28 and none EU member-states where that
0:26:03 > 0:26:08condition obtains? In other words - there are no checks, no controls, no
0:26:08 > 0:26:13infrastructure? Just as a matter of fact. If one takes the example of
0:26:13 > 0:26:17say Sweden and Norway, which is cited statements, does that apply
0:26:17 > 0:26:24there?No it doesn't.And doesn't apply in relation to Poland and
0:26:24 > 0:26:29Ukraine, despite the Ukraine's association? That is very helpful.
0:26:29 > 0:26:33Now, Stephen Crabb is next to be followed by Stephen Graham. We have
0:26:33 > 0:26:38hit a rich seam and a number of colleagues want to come in.I want
0:26:38 > 0:26:42to ask Mr Booth to answer that question which was put out there,
0:26:42 > 0:26:47whether the circumstances of Ireland and Northern Ireland mean, are
0:26:47 > 0:26:51unique enough to mean that the EU will feel motivated to compromise on
0:26:51 > 0:26:56how stringent it wants to implement its regulatory checks, whether there
0:26:56 > 0:27:01is a fudge option there?Ultimately that is a political question. I
0:27:01 > 0:27:05think that the only way this does get solved is both sides move a bit.
0:27:05 > 0:27:12I agree that would require the EU to show some flexibility. And that
0:27:12 > 0:27:17would beviable long-term?The long-term deal. We then revisit this
0:27:17 > 0:27:22issue two more times before we are done. We will revisit it at the end
0:27:22 > 0:27:26of this Article 50 process. If the final partnership is not agreed by
0:27:26 > 0:27:31that point it will have to be put off again. I think what is crucial
0:27:31 > 0:27:36throughout this process between now and then is that we start to hon in
0:27:36 > 0:27:40on the issues where this really matters, defining what we actually
0:27:40 > 0:27:44mean by full alignment in, what is the scope that might apply to.
0:27:44 > 0:27:47Clearly at the moment there is no agreement between both parties, what
0:27:47 > 0:27:54we are talking about. Is this just about agricultural products? Is it
0:27:54 > 0:27:57about wider manufacturing products? What are we talking about? At this
0:27:57 > 0:28:03moment this is a vague concept. We need to hon in on what thingual
0:28:03 > 0:28:08issues are that the EU are concerned about. What is specifically
0:28:08 > 0:28:11concerned the EU will happen? How can the UK seek to address those
0:28:11 > 0:28:18concerns? That's what we need to get to know, I think.So you wounltd
0:28:18 > 0:28:25necessarily agree with the professor on that there's no precedent at all
0:28:25 > 0:28:29for the EU not firmly implementing its regulatory requirement at
0:28:29 > 0:28:33borders?On the border there are not many precedents. There are in the UK
0:28:33 > 0:28:39history where it is fudged through a series of legal and things which you
0:28:39 > 0:28:41might have said were unthinkable politically six months before. The
0:28:41 > 0:28:45EU has managed to find a way if there is a will. That is what it
0:28:45 > 0:28:50comes down to in the end.And to the wider panel, did you think that
0:28:50 > 0:28:57there is clarity and agreement between the EU, the UK and Irish
0:28:57 > 0:29:01Government about what no physical checks actually means?I am not in a
0:29:01 > 0:29:05position to say, to be honest. From reading the document and lissening
0:29:05 > 0:29:08to what the various sides say, probably not. That is a guess rather
0:29:08 > 0:29:11than based on knowledge.
0:29:16 > 0:29:21I would say the expansion of the words used in the joint report, hard
0:29:21 > 0:29:24border, that could have been a phrase that is open to
0:29:24 > 0:29:27interpretation. You can have a bit of a border that is not that hard
0:29:27 > 0:29:36and get away with it. Referring to any physical infrastructure,
0:29:36 > 0:29:40referring to formalities, is a hostage to fortune. Customs about
0:29:40 > 0:29:43checks and formalities. That is inescapable. It is not just a matter
0:29:43 > 0:29:51of EU law or UK law. It is WTO law as well. You can have fudges, room
0:29:51 > 0:29:57for a wriggle. But border customs mean checks and formalities. It was
0:29:57 > 0:30:03a bit on helpful to add that expanded formulation of the words.
0:30:03 > 0:30:09Potential hostage to fortune in the future.If you were drafting the
0:30:09 > 0:30:12agreement between the EU and UK, what would you deliver to make sure
0:30:12 > 0:30:18you can deliver on no checks?I don't think you can. That is one of
0:30:18 > 0:30:20the main problems we have come across particularly with the
0:30:20 > 0:30:26proposals customs. Hillary mention the Norway and Sweden border before.
0:30:26 > 0:30:31In a way the Norway Sweden border is about as closely integrated a border
0:30:31 > 0:30:35as you can get without being in the Customs Union. Bear in mind there
0:30:35 > 0:30:43are no customs tariffs are duties of any kind on most categories of goods
0:30:43 > 0:30:50between EU member states, there are no internal tariffs between those
0:30:50 > 0:30:55countries. Only external tariffs, which involve third countries with
0:30:55 > 0:30:58pretty much full regulatory alignment and convergence and
0:30:58 > 0:31:02cooperation within the EU agreement. There is still a customs border. It
0:31:02 > 0:31:07still has to function as a customs border. You can manage it, control
0:31:07 > 0:31:13it. You can say commercial vehicles must go through these checkpoints.
0:31:13 > 0:31:16But a common border zone, between Norway and Sweden, whether customs
0:31:16 > 0:31:21officials can travel across the border freely, but it is still a
0:31:21 > 0:31:26customs border. That is as close and cooperative as you can get. But you
0:31:26 > 0:31:32still have checks, formalities, physical infrastructure etc.Can I
0:31:32 > 0:31:36just add one thing? The mention of tariffs is interesting. We are back
0:31:36 > 0:31:41to the start of the question. This is in the event of no deal. In the
0:31:41 > 0:31:45event of no deal there will be customs tariffs. If the EU is
0:31:45 > 0:31:48correct in saying it wants to enforce its border, presumably the
0:31:48 > 0:32:00EU will set of customs posts to collect the tariffs gear -- due? If
0:32:00 > 0:32:07the EU sticks to its word it will have to impose a border.
0:32:07 > 0:32:11That would require the UK sing unilaterally we're not going to have
0:32:11 > 0:32:18tariffs.For the world. When you say you have no tariffs, you are saying
0:32:18 > 0:32:23you have no tariffs for anybody.The EU presumably wants to correct --
0:32:23 > 0:32:30collect its tariffs? In the event of no deal, whether the UK unilaterally
0:32:30 > 0:32:35does anything, it's beside the point. It will require the EU as
0:32:35 > 0:32:41well to provide a border.Leading on from that, can I gently chides the
0:32:41 > 0:32:47language that all three of you have been using? You have consistently
0:32:47 > 0:32:50used the word fudge. Negotiations are about people with different
0:32:50 > 0:32:57starting points. What is always required to make them seed --
0:32:57 > 0:33:04succeed our compromise. Fudge is a negative word. Compromise is a
0:33:04 > 0:33:07positive one. You will talk about fudges as if reaching an agreement
0:33:07 > 0:33:12through that is a negative achievement. Michael, why don't you
0:33:12 > 0:33:16use the word compromise and recognise that actually compromise
0:33:16 > 0:33:20has already been made to achieve the first phase and get us through to
0:33:20 > 0:33:27the next phase? And what makes you believe it will be possible to
0:33:27 > 0:33:29achieve similar compromises, to achieve a similar agreement, in the
0:33:29 > 0:33:37second phase?I used the word fudge because you started off asking us
0:33:37 > 0:33:41about Northern Ireland, and that is definitely a fudge. There are other
0:33:41 > 0:33:45parts of the joint report which are definitely compromises and
0:33:45 > 0:33:49definitely deliver positive results. The citizens rights part of the
0:33:49 > 0:33:54joint report is based on a series of compromises, both by the UK and the
0:33:54 > 0:34:00EU, and it has produced a close to, not complete, but close to a full
0:34:00 > 0:34:05political agreement which can be translated into legal text. That is
0:34:05 > 0:34:09a positive compromise. I mentioned common travel area. That is not a
0:34:09 > 0:34:13fudge. That is a clear achievement. It is a positive thing and it's
0:34:13 > 0:34:18clear in itself. The difference with the customs border...On common
0:34:18 > 0:34:21travelling, the reason that was so easy is because both sides want the
0:34:21 > 0:34:27same solution.There were different reasons why it was straightforward.
0:34:27 > 0:34:32Both sides wanted the same solution. It had relatively little to do with
0:34:32 > 0:34:39EU law.If both sides want the same solution in terms of an access --
0:34:39 > 0:34:41absence of physical infrastructure, what makes you believe it will be
0:34:41 > 0:34:47impossible to arrive at that? Just saying there is no precedent for it
0:34:47 > 0:34:54isn't necessarily an obstacle to arriving at some new method. You
0:34:54 > 0:35:01said that the Customs Union requires a particularly type of character or
0:35:01 > 0:35:04border. They have been changing throughout history all the time. I
0:35:04 > 0:35:08do believe it would be so impossible to arrive at an agreement on what
0:35:08 > 0:35:12the border could look like?It will be possible to arrive rather than
0:35:12 > 0:35:16agreement. It depends on which compromises are eventually made. The
0:35:16 > 0:35:19point about the Northern Ireland section on the customs and
0:35:19 > 0:35:23regulatory border being a fudge for the time being is that they haven't
0:35:23 > 0:35:27reached any solutions. They haven't reached any agreement. They have
0:35:27 > 0:35:31simply said, we are going to come back to this at a later date.When
0:35:31 > 0:35:36both sides said they didn't want physical infrastructure...When they
0:35:36 > 0:35:43come back to us they will have this great the circle. There are many
0:35:43 > 0:35:48more people than just us sitting on this panel who have observed that if
0:35:48 > 0:35:52you're going to leave the Customs Union and the single market, but you
0:35:52 > 0:35:55don't want to have any physical infrastructure between the Republic
0:35:55 > 0:35:58of Ireland and Northern Ireland, and you are not willing to have any
0:35:58 > 0:36:03border between Northern Ireland and Great Britain, you have got a
0:36:03 > 0:36:13serious problem.Stephen, if that is the case, why does that not act as a
0:36:13 > 0:36:17further incentive for the Republic of Ireland to give positive impetus
0:36:17 > 0:36:21for making sure that we don't arrive at a no deal end to the
0:36:21 > 0:36:29negotiations?I would say that for the record I do think that a
0:36:29 > 0:36:34compromise could be found. Certainly in the long-term. At the moment it
0:36:34 > 0:36:39is quite difficult to see what that is because we are still discussing
0:36:39 > 0:36:41as if, we're talking about everything rather than narrowing
0:36:41 > 0:36:44down to the areas where the compromise may be found.
0:36:44 > 0:36:50Agricultural standards, for example. But on this particular point, since
0:36:50 > 0:36:55the UK has said, we will not put up physical infrastructure, the obvious
0:36:55 > 0:36:59implication is that the only side that could do it would be the
0:36:59 > 0:37:03Republic of Ireland. What degree of political enthusiasm you deduce in
0:37:03 > 0:37:09the Republic of Ireland for doing that?I am not going to speak for
0:37:09 > 0:37:13Ireland. I don't think they would want to do that. It is not just
0:37:13 > 0:37:21their decision. It is the EU 27's decision. I think what the question
0:37:21 > 0:37:26really is, is how much that does the EU 27 want to force Ireland to put
0:37:26 > 0:37:31the border up? I think what has been quite interesting in this process of
0:37:31 > 0:37:35the joint report has been that effectively it looks like the EU 27
0:37:35 > 0:37:39has been quite happy for Ireland to take the lead in negotiating this in
0:37:39 > 0:37:43terms of the position with the UK. So I think if the UK and Irish
0:37:43 > 0:37:48governments can come to a compromise, it will be difficult for
0:37:48 > 0:37:52the EU to turn around and say, we don't accept this.Thank you.
0:37:52 > 0:37:59Christopher Chope. When David Davis said this joint
0:37:59 > 0:38:02report was a statement of intent and not legally binding, he was
0:38:02 > 0:38:09absolutely right. Yes? You agree? He was absolutely right in saying it
0:38:09 > 0:38:16was not legally binding.I think it requires a more nuanced analysis. It
0:38:16 > 0:38:20is clearly not legally binding. I think we can all agree on that. It
0:38:20 > 0:38:24is not a legally binding agreement. It is more than merely a statement
0:38:24 > 0:38:28of intent. We can give what the expectations are and we probably
0:38:28 > 0:38:30have to qualify those expectations in several really quite important
0:38:30 > 0:38:37ways. The expectation, and this is in the text of the joint report, is
0:38:37 > 0:38:42that the joint report will be respected in full. It will be
0:38:42 > 0:38:45treated as a package, translated into a final legal text as quickly
0:38:45 > 0:38:49as possible, and it will be on picked. The joint report says quite
0:38:49 > 0:38:55clearly that attempting to do that for what has already been agreed
0:38:55 > 0:39:02will have adverse consequences for the rest of the agreement. It is not
0:39:02 > 0:39:08just a statement of intent. Breach will have future consequences. I
0:39:08 > 0:39:13think we have to nuanced this idea of those clear expectations in a
0:39:13 > 0:39:17couple of different ways. First of all, these are not complete
0:39:17 > 0:39:21agreements. I mentioned citizens drives. That is the most advanced
0:39:21 > 0:39:23part of the agreement which has been reached under the joint report. It
0:39:23 > 0:39:29comes closest to being ready and finalised and can be translated into
0:39:29 > 0:39:35a final text. Even the citizens rights parts have gaps, in some
0:39:35 > 0:39:38parts of significant gaps. Secondly, I suggested earlier run that when it
0:39:38 > 0:39:43comes specifically to the question of Northern Ireland, the border, the
0:39:43 > 0:39:47customs and regulatory border, rather than the common travel area,
0:39:47 > 0:39:53there are irreconcilable commitments in there which you may not
0:39:53 > 0:40:00necessarily make concrete in a way that will pin down future
0:40:00 > 0:40:02negotiations. The European Parliament, in its resolution after
0:40:02 > 0:40:06the joint report was published, welcomed the joint report and said,
0:40:06 > 0:40:11we are happy with what has been achieved. We want to revisit some of
0:40:11 > 0:40:15these issues, particularly on citizens rights, future partners,
0:40:15 > 0:40:20the binding nature of the courts of justice. There is a political
0:40:20 > 0:40:25expectation already on the European Parliament side that part of the
0:40:25 > 0:40:30joint report agreement could still be up for a re-discussion. And in
0:40:30 > 0:40:33the final qualification, the transitional deal, if there is one.
0:40:33 > 0:40:36That could have a significant impact on the way that some parts of the
0:40:36 > 0:40:40report have to be considered and construed. For example, the
0:40:40 > 0:40:44effective date on which certain parts of the agreement make come
0:40:44 > 0:40:51into force. Clear expectation that this is binding, not legally, but a
0:40:51 > 0:40:54clear expectation that it will become one, but it has to be nuanced
0:40:54 > 0:41:03by those qualifications.The Dutch Prime Minister said the text should
0:41:03 > 0:41:07be converted into a form that is legally binding. Thereby suggesting
0:41:07 > 0:41:13that the European Parliament doesn't want to amend any of the substance
0:41:13 > 0:41:15in it, which seems slightly inconsistent with what you have just
0:41:15 > 0:41:19said.I think the European Parliament has not used the words
0:41:19 > 0:41:22amending what has been agreed, but extending what has already been
0:41:22 > 0:41:26agreed to new things. I will give some examples from the list. This is
0:41:26 > 0:41:30the text of the European Parliament resolution. There are still
0:41:30 > 0:41:33outstanding issues to be resolved before the withdrawal agreement can
0:41:33 > 0:41:36be finalised. They give some examples. Extending the coverage of
0:41:36 > 0:41:41citizens rights provisions to future partners. We thought that had been
0:41:41 > 0:41:46settled. Apparently not quite. The binding character of court of
0:41:46 > 0:41:51justice decisions on citizens rights provisions. And the future role of
0:41:51 > 0:41:54the UK national independence authority to act on citizens'
0:41:54 > 0:41:58complaints. And a very important one, guaranteeing freedom of
0:41:58 > 0:42:03movement across the EU 27 for current EU migrants in the UK. Some
0:42:03 > 0:42:07of those issues are on the table, were going to be on the table for
0:42:07 > 0:42:11future negotiation. Some we thought were pretty much settled in the
0:42:11 > 0:42:16joint report. But the European Parliament resolution suggests they
0:42:16 > 0:42:21can be revisited. Not using the phrase revisited. But an extended
0:42:21 > 0:42:28scope of application.Can we now look at what the Taoiseach said? He
0:42:28 > 0:42:34described this fudge as politically bullet-proof and Castan fudge. Was
0:42:34 > 0:42:42he correct in that?Referring to paragraph 49 in particular?I'm
0:42:42 > 0:42:46referring to what the Taoiseach said immediately following this
0:42:46 > 0:42:51agreement, this joint report. And he said that this joint report was
0:42:51 > 0:42:57politically bullet-proof and cast iron, when some people were
0:42:57 > 0:43:03suggesting it may be rather vague, a fudge. The Taoiseach was saying to
0:43:03 > 0:43:08his people in the Republic of Ireland, don't worry people, this is
0:43:08 > 0:43:13politically bullet-proof and cast are in.Was he correct? It goes back
0:43:13 > 0:43:17to what Michael was saying about the agreement being all things to all
0:43:17 > 0:43:21men at the moment. This takes us back to the discussion about fudge
0:43:21 > 0:43:26versus compromise. For me the difference between fudge and
0:43:26 > 0:43:30compromise is a compromise can be implemented. There are bits of this
0:43:30 > 0:43:34agreement that maybe now, just about. There are other bits,
0:43:34 > 0:43:36particularly the paragraph around alignment, which frankly is not
0:43:36 > 0:43:41because the choices necessarily have not been made. That is the
0:43:41 > 0:43:44distinction between fudge, were you clearly need to make a choice
0:43:44 > 0:43:46Estelle, and compromise, or you have arrived at something you could
0:43:46 > 0:43:51probably implement very quickly. It takes us back all the way back to
0:43:51 > 0:43:57the fact that those choices have yet to be made and will have to be made.
0:43:57 > 0:44:03These questions are leading to this point. Which is that I, and I know a
0:44:03 > 0:44:06number of other people, are concerned that this issue may be
0:44:06 > 0:44:13referred to the European Court of Justice by either of the parties. If
0:44:13 > 0:44:18it is such a fudge, if it is so vague, open to interpretation, are
0:44:18 > 0:44:22we not increasing the possibility that the European Parliament are
0:44:22 > 0:44:27some outlier may referred to the European Court of Justice within a
0:44:27 > 0:44:32constant current delay of six months to two years?
0:44:33 > 0:44:36Are you talking about the status of the current report or the final
0:44:36 > 0:44:40withdrawal?Not the report itself but where we are heading?No, there
0:44:40 > 0:44:46are a range of issues. They could potentially be referred to the court
0:44:46 > 0:44:52of justice for a resolution. I would not say that the legal status of the
0:44:52 > 0:44:57joint report is one of them because I do not think anybody, really,
0:44:57 > 0:45:01different people will tell their domestic audiences different
0:45:01 > 0:45:03interpretations of this document because that's what people do after
0:45:03 > 0:45:07a major summit but I don't think that anybody really would seriously
0:45:07 > 0:45:12believe that this is a question worth asking the Court of justice.
0:45:12 > 0:45:15It's a phase, another step in a lengthy and complex negotiation.
0:45:15 > 0:45:23There are few chill -- future issues that mitigate the Court of Justice
0:45:23 > 0:45:26or a request for advice. One of them has been discussed many times
0:45:26 > 0:45:32before. I will raise it as an example, he noticed to withdraw and
0:45:32 > 0:45:38Article 50 but in the context of these negotiations, whether it
0:45:38 > 0:45:43provides a side legal business for an extensive transitional regime, is
0:45:43 > 0:45:51sophisticated regime can be based on Article 50, that's an open question.
0:45:51 > 0:45:55The transitional regime, whether it can be do by the EU institutions
0:45:55 > 0:46:01acting under Article 50 or whether it may also require ratifications by
0:46:01 > 0:46:04every member state and their parliaments, that would be
0:46:04 > 0:46:08undesirable from everyone's point of view. On the one hand, I think
0:46:08 > 0:46:12there's a real incentive for people not to ask the Court of Justice as
0:46:12 > 0:46:17it adds more time into the process. It does not need to be 12-18 months,
0:46:17 > 0:46:20the court can do things quickly when it knows that things need a quick
0:46:20 > 0:46:25answer. There have been judgments from the court, they deliver
0:46:25 > 0:46:30judgments in the space of four weeks when it is required to do so. The
0:46:30 > 0:46:36timing is unfortunate but not as bad as your question may have suggested.
0:46:36 > 0:46:39Having said that, I do think that there are a range of difficult
0:46:39 > 0:46:47issues the court may be called upon to adjudicate. But really, even a
0:46:47 > 0:46:50small delay in time could potentially be very difficult. I
0:46:50 > 0:46:53think somebody described the transitional arrangements as a
0:46:53 > 0:46:59wasted asset. The longer it takes to get this finalised, sorted, the less
0:46:59 > 0:47:04valuable it is. Even a relatively minor delay before the court can be
0:47:04 > 0:47:07difficult. I suppose the other factor is that this is not good in
0:47:07 > 0:47:12the hands of the government alone. National parliament or a national
0:47:12 > 0:47:16parliamentarian may decide that they are not happy with what their
0:47:16 > 0:47:18government is agreeing to politically. There may be a
0:47:18 > 0:47:23reference from a national court to the Court of Justice, simply by
0:47:23 > 0:47:26passing member states and institutions. It isn't entirely
0:47:26 > 0:47:30within the control of the actors of the negotiations themselves, where
0:47:30 > 0:47:37the Court of justice becomes involved.I think going back to your
0:47:37 > 0:47:40original question, there is the possibility that this could end up
0:47:40 > 0:47:44before the ECJ, the withdrawal agreement itself, which is going to
0:47:44 > 0:47:48be in the minds of negotiators when they draft legal text, they want it
0:47:48 > 0:47:53to be legally solid and legally sound and in accordance with EU law.
0:47:53 > 0:47:55Fear a hothouse?
0:48:01 > 0:48:06-- I remember you from there. Could we move on, to what extent has the
0:48:06 > 0:48:12joint report made a no deal scenario more less likely? Perhaps if I could
0:48:12 > 0:48:26ask the Professor?I do not like these odds games but I would think
0:48:26 > 0:48:30that a no deal scenario would be less likely, but it makes the
0:48:30 > 0:48:38extremes less likely, I would say. Yes, it's a strong political signal
0:48:38 > 0:48:44that the EU would like a deal, an important political signal. But
0:48:44 > 0:48:48ultimately, if issues like the Irish border cannot be resolved, then no
0:48:48 > 0:48:54deal is still a possibility. I agree that it is less likely than it was
0:48:54 > 0:49:00three months ago, as a result of this agreement.I agree, I think
0:49:00 > 0:49:07everybody wants a deal aside from some at the fringes. One of the
0:49:07 > 0:49:10difficulties, I suppose, is again, the more that time goes on and the
0:49:10 > 0:49:15closer we get to an actual withdrawal date, having banked all
0:49:15 > 0:49:18of us on sorting these problems out amicably by agreement through
0:49:18 > 0:49:23multilateral processes, are less likely it is that people can just
0:49:23 > 0:49:26walk away because they will not be in a position to deal with the
0:49:26 > 0:49:30consequences for themselves. Not in a way that wouldn't cause serious
0:49:30 > 0:49:33disruption to their own citizens and businesses, let alone anyone else
0:49:33 > 0:49:43here.The elephant in the room is the customs union and single market.
0:49:43 > 0:49:50So, with the ideal scenario involves the single market and access to the
0:49:50 > 0:50:01single market? We were talking about Fudge, but how can it be fudged?
0:50:01 > 0:50:05There are two separate deals at play here, I was referring to the Article
0:50:05 > 0:50:0950 deal, which would have to be negotiated and resolved by October
0:50:09 > 0:50:13next year and the second is the trade deal. I do not expect it to be
0:50:13 > 0:50:17more than a statement of intent about a trade deal in place, we will
0:50:17 > 0:50:23not get anywhere near ratifying a trade deal at the time we are
0:50:23 > 0:50:25ratifying Article 50. I was talking about no Article 50 rather than
0:50:25 > 0:50:35anything to do with the trade deal. When we went as a group, the Liberal
0:50:35 > 0:50:39Democrats to Brussels, we were told by the EU then, in September, that a
0:50:39 > 0:50:44transition period is not an extension after the status quo but a
0:50:44 > 0:50:46transition by which, you know before we enter a transition, we know where
0:50:46 > 0:50:54we are going to, say how can that be done, if by March 2019, with a
0:50:54 > 0:50:58withdrawal agreement, we also know where we are going in order to have
0:50:58 > 0:51:05a transition, how is that going to work out?We have an idea about the
0:51:05 > 0:51:10direction of travel, if not a destination.I would agree, in the
0:51:10 > 0:51:13statement of intent, it has to be clear to both parties what the
0:51:13 > 0:51:17ultimate objective is, and from a UK site that is very clear, that is to
0:51:17 > 0:51:21be outside the single market, outside the customs union and
0:51:21 > 0:51:26negotiate the best possible free-trade agreement. I think again,
0:51:26 > 0:51:29by virtue of agreement, this text has tacitly agreed that that is what
0:51:29 > 0:51:33the UK has said so I think we are all along the same understanding
0:51:33 > 0:51:37that if that's the direction the UK is going in, there's a lot of detail
0:51:37 > 0:51:43left to be answered.Did I hear you saying that you think the tacit
0:51:43 > 0:51:47agreement is that the UK will be outside of the single market and the
0:51:47 > 0:51:52customs union?Yes, I think the EU has understood that is the UK's
0:51:52 > 0:51:58position.I think there's an interesting change in the EU's
0:51:58 > 0:52:01approach. I've worked on the question of transition for a little
0:52:01 > 0:52:04while now. Obviously I was looking carefully for what happened at the
0:52:04 > 0:52:10European Council meeting to see how they phrased transition, there were
0:52:10 > 0:52:14a number of issues concerned about transition but one of the issues
0:52:14 > 0:52:21concerning me was precisely your point, that the EU guidelines from
0:52:21 > 0:52:26April 2017, they said that it cannot be abstract but it has to be a
0:52:26 > 0:52:30reasonably foreseeable future
0:52:30 > 0:52:32be abstract but it has to be a reasonably foreseeable future. It
0:52:32 > 0:52:35has to be bridged with a new relationship, even if not fully
0:52:35 > 0:52:39crystallised is at least reasonably clear. For me, that meant a
0:52:39 > 0:52:43difficult and potential problem in the face to negotiations, because we
0:52:43 > 0:52:49know so little about what the UK's positive vision of a steep and
0:52:49 > 0:52:52special partnership is, we know the negative bits, we don't want being
0:52:52 > 0:52:56the customs union or single market, but we don't know much about the
0:52:56 > 0:53:00more positive aspects of that future relationship. One of my concerns
0:53:00 > 0:53:04was, how can you then square this with April guidelines? What I do
0:53:04 > 0:53:10think is interesting is that the EU has read-only sequencing of the
0:53:10 > 0:53:14transition and future agreement negotiations, they are perfectly
0:53:14 > 0:53:19happy to begin talking about transition in January and hopefully
0:53:19 > 0:53:23get transition sorted out fairly quickly, possibly by March. It may
0:53:23 > 0:53:27take longer, there are a lot of issues but they would not even have
0:53:27 > 0:53:30adopted their guidelines on the future relationship until March
0:53:30 > 0:53:35anyway. The EU itself seems to have changed its position and willing to
0:53:35 > 0:53:39sort out a petering out transition without necessarily having agreed a
0:53:39 > 0:53:43clear destination into the future, which was what we thought they may
0:53:43 > 0:53:47insist upon. From that point of view I think there has been a change of
0:53:47 > 0:53:52policy rather than just a change in emphasis.He would agree for
0:53:52 > 0:53:55businesses telling us they need clarity that this hasn't added any
0:53:55 > 0:54:03clarity?Not yet.I think it hasn't given concrete legal clarity but I
0:54:03 > 0:54:07think there is a strong sense of political assurance that both sides
0:54:07 > 0:54:11won the transition to happen. From a business point of view, that is
0:54:11 > 0:54:15important and a lot of businesses have been saying that an agreement
0:54:15 > 0:54:18in principle and transition in March would go a long way towards
0:54:18 > 0:54:30reassuring.Thank you. Stephen Kinnock?Thank you. Banks just to be
0:54:30 > 0:54:35clear on the terms of the transition, the EU has been
0:54:35 > 0:54:38consistent, if you look at previous negotiation guidelines and the
0:54:38 > 0:54:45European Parliament resolution, that the transition will, in essence, be
0:54:45 > 0:54:53a carbon copy of the status quo, so all existing union judiciary,
0:54:53 > 0:55:00supervisory, budget and structures apply, including the competence of
0:55:00 > 0:55:05the Court of Justice of the European Union. Could you briefly, would you
0:55:05 > 0:55:08all say that you absolutely agree with that? That in effect we will
0:55:08 > 0:55:15continue membership in all but name following the 29th of March 2019?
0:55:15 > 0:55:21Yes, I think that is right, that is the UK's government understanding.
0:55:21 > 0:55:25Accepting the role of the ECJ during transition is her understanding of
0:55:25 > 0:55:30how that would work as well. I think the potential quibble point is about
0:55:30 > 0:55:34what happens to new EU laws made during the transition period and how
0:55:34 > 0:55:38they affect the UK. Politically, the EU would insist on that and it may
0:55:38 > 0:55:43be difficult for the UK to negotiate their way out of that. In practical
0:55:43 > 0:55:47circumstances, if we are talking about it transition lasting until
0:55:47 > 0:55:51December 2020, the data Michel Barnier is talking about, most
0:55:51 > 0:55:56directives have an 18 month grace period before you implement them. In
0:55:56 > 0:56:00practical purposes there are a lot of things you may say or do you wear
0:56:00 > 0:56:03the UK would never have to implement it anywhere but to answer your
0:56:03 > 0:56:07question yes, I think the UK and EU have both agreed it will extend the
0:56:07 > 0:56:13current terms and a different legal form.I don't like the formulation
0:56:13 > 0:56:15membership in all but name, membership implies that you get a
0:56:15 > 0:56:22say. That is fundamental in a transitional stage and membership,
0:56:22 > 0:56:25that there are all of the obligations but none of the rights
0:56:25 > 0:56:29when it comes to political participation but yes, it seems to
0:56:29 > 0:56:34me that for reasons apart from anything else of time, that the EU
0:56:34 > 0:56:39is saying, we cannot negotiate anything this book, it would be too
0:56:39 > 0:56:43complicated, too time-consuming, we only have until October so
0:56:43 > 0:56:45basically, the status quo minus participation is what we can offer
0:56:45 > 0:56:51you at this point when it comes to transition. The phraseology of
0:56:51 > 0:56:55paragraph four, it strongly implies that the EU has a position on what
0:56:55 > 0:56:59happens to new EU laws, that we all had to adopt them. It's a clear
0:56:59 > 0:57:06distinction between the two sides.I would go slightly further. In the
0:57:06 > 0:57:12work I've been doing on transition over the last several weeks, I have
0:57:12 > 0:57:15identified eight different points. Some of them are not that serious,
0:57:15 > 0:57:19like when the UK says that it wants to have the ability to negotiate new
0:57:19 > 0:57:24trade deals, but they will not enter under false until the transition is
0:57:24 > 0:57:28ever, even the EU Parliament in its resolution from December earlier
0:57:28 > 0:57:31this month have said they can live with that. Potential quibble points
0:57:31 > 0:57:35are being resolved as the situation develops although they are a bit
0:57:35 > 0:57:41more serious. For example, the UK suggested it wants full
0:57:41 > 0:57:45participation in all of the EU regulatory agencies during
0:57:45 > 0:57:48transition, the EU has clearly said that you can have operational
0:57:48 > 0:57:52participation but you cannot have decision-making participation.
0:57:52 > 0:57:55That's a potential sticking point. Others, concerning Gibraltar for
0:57:55 > 0:57:59example, we've no idea whether Gibraltar would be covered by a
0:57:59 > 0:58:02transitional period. There were noises from Spain that it should not
0:58:02 > 0:58:07be. Politically, there is still a range of issues which needs to be
0:58:07 > 0:58:11discussed and debated on transition. From my perspective legally, there
0:58:11 > 0:58:16are two the questions outstanding on transition. The first is one I've
0:58:16 > 0:58:18mentioned before, could a sophisticated transitional agreement
0:58:18 > 0:58:23be agreed in terms of Article 50 or would it require national
0:58:23 > 0:58:28ratifications as well? At the moment, the EU's political stances
0:58:28 > 0:58:32that Article 50 is an exceptional competence and procedure, and the
0:58:32 > 0:58:36member states politically have said that the EU could do this alone,
0:58:36 > 0:58:40even if it touches upon matters of national competence and will not
0:58:40 > 0:58:43require national ratification. That is very useful because it takes away
0:58:43 > 0:58:47potentially months or years of waiting time, as national
0:58:47 > 0:58:51parliaments debate this agreement and decide to vote but it is only a
0:58:51 > 0:58:54political understanding, it's vulnerable to legal challenge of a
0:58:54 > 0:58:59disgruntled parliamentarian decides otherwise. The other big issue,
0:58:59 > 0:59:02relating to what we call the autonomy of EU law, how far can a
0:59:02 > 0:59:07third country which the UK will be by then participate or influence the
0:59:07 > 0:59:11internal functioning of the EU itself? This is where I think, for
0:59:11 > 0:59:16example, the issue of the EU regulatory agencies is clear. The EU
0:59:16 > 0:59:20does not want UK decision-making participation in the EU regulatory
0:59:20 > 0:59:23agencies because it could render a transitional agreement vulnerable to
0:59:23 > 0:59:27legal challenge before the Court of Justice for infringing the autonomy
0:59:27 > 0:59:35of the UK legal system. So there are political issues and legal issues.
0:59:35 > 0:59:38One of the big issues remains the appropriate vehicle by which to do
0:59:38 > 0:59:40this. We could have just extended membership and Article 50 by
0:59:40 > 0:59:44unanimous agreement, we could have agreed a third date of entry for the
0:59:44 > 0:59:52with withdrawal agreement, we could have used it for different purposes,
0:59:52 > 0:59:54we could say the institutional provisions of the withdrawal
0:59:54 > 0:59:59agreement would enter into force in March 2019 but with substantive
0:59:59 > 1:00:02provisions to do with the internal market or policy making would enter
1:00:02 > 1:00:08into force within two years. They are legally neat ways of achieving
1:00:08 > 1:00:13the transition. As you suggested, to negotiate a parallel system of
1:00:13 > 1:00:15transition from scratch is potentially incredibly
1:00:15 > 1:00:19time-consuming and could almost involve as many difficult questions
1:00:19 > 1:00:23as simply trying to negotiate the future partnership.
1:00:23 > 1:00:28Probably worth adding a third category to that, which is the EU's
1:00:28 > 1:00:32international agreements. No one is quite certain yet what to do with
1:00:32 > 1:00:34those thousand plus agreements, political and economic agreement,
1:00:34 > 1:00:38signed with third countries, with members of the European Union as
1:00:38 > 1:00:41member states. And that third country, it's far from clear what
1:00:41 > 1:00:46our status would be with regards to that transition if we're no longer a
1:00:46 > 1:00:50member state.Thank you very much, we're having a relatively technical
1:00:50 > 1:00:54and legalistic conversation today, but I do think it's worth thinking
1:00:54 > 1:00:58also about the broader political implications of this. I'd be
1:00:58 > 1:01:01interested in your perspective on this. Do you feel that there has
1:01:01 > 1:01:12been enough discussion in terms of public discourse about the fact that
1:01:12 > 1:01:18the country voted to leave on the 23rd of June 2016 but, in effect,
1:01:18 > 1:01:22both the British government and the EU have now signed up to a
1:01:22 > 1:01:27transition deal which will, in essence, be a carbon copy of the
1:01:27 > 1:01:37status quo minus our voice at the table for a period of at least until
1:01:37 > 1:01:41December 2020? But that of course is subject to how long it'll take to
1:01:41 > 1:01:43negotiate the future relationship. I'd like to come onto that
1:01:43 > 1:01:48afterwards. I'd be interested in your perspective more in terms of
1:01:48 > 1:01:53what, you know, what do I say to the retired steel worker in Port Talbot
1:01:53 > 1:01:58in my constituency who voted Leave that when he voted Leave he probably
1:01:58 > 1:02:01had a certain set of expectations about what it would mean and how
1:02:01 > 1:02:06long it would take. That clearly now isn't going to happen. I'd be
1:02:06 > 1:02:09interested in your sort of assessment of the risks around that
1:02:09 > 1:02:17particular issue.Well, I think that part of the reason why December 2020
1:02:17 > 1:02:21has been talked about on the UK side is it's before the next general
1:02:21 > 1:02:27election. I think it's quite important we are obviously having
1:02:27 > 1:02:31left and in the process of substantively leaving by that point,
1:02:31 > 1:02:38from EU side they don't want to push this transition into a new budget
1:02:38 > 1:02:43around which will start post-2000 20. I think in the first instance,
1:02:43 > 1:02:47yes, needs to be explained to people this is perhaps more complicated
1:02:47 > 1:02:54than was expressed in a row -- expressed in the referendum
1:02:54 > 1:02:57campaign. I think the government and EU will want to start taking steps
1:02:57 > 1:03:01that take effect from 2020 that substantively mean a difference from
1:03:01 > 1:03:07the status quo. I think in terms of a transition period, we're looking
1:03:07 > 1:03:12at two, one of which is standstill transition, which I think we'll
1:03:12 > 1:03:16probably end in 2020. Then you're still going to go through a process
1:03:16 > 1:03:19of implementing whatever has been agreed in that process. Moving to a
1:03:19 > 1:03:25new custom system, new trade regime, new regulatory regime on services
1:03:25 > 1:03:30and so on. I think that would obviously take longer than many
1:03:30 > 1:03:33people may have bought but in order to have a smooth and orderly Brexit,
1:03:33 > 1:03:38that is what will be required. I think it's not necessarily a bad
1:03:38 > 1:03:41thing as long as we get to the point where we are entering a new election
1:03:41 > 1:03:47on which the terms of our engagement with the EU are clearly changing.
1:03:47 > 1:03:52I'm not sure this is the time or place to talk about what you should
1:03:52 > 1:03:57take your constituent. It does occur to me, following what Michael said
1:03:57 > 1:04:00earlier, one easy way to do transition which would circumvent
1:04:00 > 1:04:04all the problems we've mentioned in passing would be to do it via an
1:04:04 > 1:04:09extension of the Article 50 target an extended by a couple of years,
1:04:09 > 1:04:13call it transition. It is very much with a view to the kinds of issues
1:04:13 > 1:04:19you phrased, that it is being seen as politically acceptable. The
1:04:19 > 1:04:24moment of leaving is important in all of this, the minute the
1:04:24 > 1:04:27government can turn around and say, we've left the European Union, is
1:04:27 > 1:04:32something they are keen to put back. Transition will be quite a fraught
1:04:32 > 1:04:38period. It'll be a period where the country is chafing at the bit of
1:04:38 > 1:04:43being out but still bound. Politically I think it's going to be
1:04:43 > 1:04:47very difficult. The adjudication mechanisms in place to ensure that
1:04:47 > 1:04:50system holds, I think it'll be a fragile state of affairs those years
1:04:50 > 1:04:54in many ways, because of the political pressures you've
1:04:54 > 1:04:57mentioned, to say, we've left, country star doing the things we
1:04:57 > 1:05:01said we'd do? The answer is no. Real tensions will come after we've left,
1:05:01 > 1:05:08and nothing has changed.I'll focus on a slightly different motivation
1:05:08 > 1:05:12for a transitional period. And for me this is probably the most
1:05:12 > 1:05:20important motivation of the lot. The Prime Minister has said said quite
1:05:20 > 1:05:23rightly, everyone will benefit from having more time to prepare for is
1:05:23 > 1:05:30coming. I think in many respects it has been interpreted as to get our
1:05:30 > 1:05:33ports ready for new custom restrictions, airport ready answer
1:05:33 > 1:05:37one. I think the problems run far deeper than that and I suspect
1:05:37 > 1:05:40nearly everyone in this room will know this very acutely, when you
1:05:40 > 1:05:44look at the volume of work that has to be done under the European Union
1:05:44 > 1:05:47withdrawal bill, when eventually enacted, we're talking about
1:05:47 > 1:05:52potentially thousands of changes to our legal system, many of them
1:05:52 > 1:05:56utterly fundamental and going right to the heart of the various sectors
1:05:56 > 1:06:01in which they are operable. We still have to construct new regulatory
1:06:01 > 1:06:07regimes on fisheries, agriculture, trade, customs, nuclear safety. We
1:06:07 > 1:06:13have to effectively rewrite large parts of our own legal system. We
1:06:13 > 1:06:17mentioned an incredibly serious problem, well over 1000 EU external
1:06:17 > 1:06:21agreements with third countries and international organisations which we
1:06:21 > 1:06:25either participate in or benefit from. We'd have no idea what the
1:06:25 > 1:06:28status of those is. We see what the initial reaction is to our attempt
1:06:28 > 1:06:33to sort out together with the EU, with the joint proposal and
1:06:33 > 1:06:36regularise our membership of the WTO. It was virtually slapped back
1:06:36 > 1:06:40in our face by a whole range of countries. We're not in a position
1:06:40 > 1:06:44we can say we can fall back on WTO rules because we are not sure what
1:06:44 > 1:06:48our WTO membership is going to look like and how far it'll be accepted
1:06:48 > 1:06:51and regularised by the others. When you put together this enormous range
1:06:51 > 1:06:55of challenges I would say we simply need more time to be ready to leave
1:06:55 > 1:06:59the EU internally without causing enormous disruption to ourselves. It
1:06:59 > 1:07:02comes back to the point made earlier, it isn't about relations
1:07:02 > 1:07:08with the EU, this is about whether we leave the EU without enormously
1:07:08 > 1:07:12damaging our own citizens, own economy, businesses, because there
1:07:12 > 1:07:16is simply so much work to do and we have so little time left to do it.
1:07:16 > 1:07:20That is a major motivation behind a transitional regime. If you can't
1:07:20 > 1:07:25wait to get out, maybe you might be persuaded that not ruining your own
1:07:25 > 1:07:28economy and society in the process would be worth waiting a little bit
1:07:28 > 1:07:36extra for.Maybe. Sorry, one more question. I just wanted to connect
1:07:36 > 1:07:47this to financial settlement. So... Ministers have indicated that the
1:07:47 > 1:07:49financial settlement and the Prime Minister indicated this from the
1:07:49 > 1:07:56dispatch box as well, the financial settlement is contingent on striking
1:07:56 > 1:08:03a deal on the future relationship. But article 96 of the joint progress
1:08:03 > 1:08:12report indicates that the financial settlement is in fact contingent on
1:08:12 > 1:08:17agreeing the divorce items and the transitional deal. Because as Mr
1:08:17 > 1:08:21Barnier and others have said, there clearly won't be in agreement on the
1:08:21 > 1:08:27future relationship before we leave the European Union, just the scoping
1:08:27 > 1:08:35of the principles. Is that also your understanding, that the financial,
1:08:35 > 1:08:40in fact, the financial settlement is a done deal, assuming that the
1:08:40 > 1:08:44divorce items and transitional deal are in place? And it's not actually
1:08:44 > 1:08:48connected to the future relationship?I think this speaks to
1:08:48 > 1:08:52that infamous phrase, nothing is agreed until everything is agreed.
1:08:52 > 1:08:55For the European Union that is a reference to phase one. Everything
1:08:55 > 1:08:59has to be tied up together in phase one. It's not a reference to a link
1:08:59 > 1:09:03between phase one issues and the trade talks. From the EU perspective
1:09:03 > 1:09:09there is no link between the financial settlement and any future
1:09:09 > 1:09:12trade talks. For practical reason, which is the one you stated, we're
1:09:12 > 1:09:16not going to be in a position to sign of a trade deal till several
1:09:16 > 1:09:19years after we've been paying the money we've already agreed to pay
1:09:19 > 1:09:22anyway, because this agreement has to be signed and sealed in October
1:09:22 > 1:09:26next year. The timing is simply wrong, we can't play-off, except
1:09:26 > 1:09:29when it comes to the heads of terms, which won't be binding in any
1:09:29 > 1:09:34serious way. There is no way to play of the financial settlement against
1:09:34 > 1:09:37the terms of the future trading agreement.
1:09:39 > 1:09:42The Prime Minister has always talked about and implementation period, not
1:09:42 > 1:09:46transition. If you implement in you have to know what you are
1:09:46 > 1:09:55implementing. The timetable has been phase one, and you're quite right to
1:09:55 > 1:09:58say there was a fudge on Northern Ireland. You might reason there was
1:09:58 > 1:10:03a fudge on Northern Ireland, it was in the wrong sequencing, it's easier
1:10:03 > 1:10:08to deal with Northern Ireland when you know what a future relationship
1:10:08 > 1:10:12would look like. The second mark was the end of March, we should have an
1:10:12 > 1:10:19increment Asian agreement. The next one is October. When everything is
1:10:19 > 1:10:23supposed to be in place so it can be ratified. I think the Prime Minister
1:10:23 > 1:10:28understands that to include the special relationship. The trade
1:10:28 > 1:10:33deal. It seems to me so far everything has been following that
1:10:33 > 1:10:42schedule. All of you have talked about transition, not
1:10:42 > 1:10:48implementation. Is the Prime Minister right or are you right?I
1:10:48 > 1:10:50think it's worth noting the government rhetoric has changed
1:10:50 > 1:10:55because the initial schedule, as laid out by David Davis before the
1:10:55 > 1:11:00talks started, was that the trade negotiations would carry on
1:11:00 > 1:11:04concurrently with the article 15 negotiations from the start, so the
1:11:04 > 1:11:07timetable is that according to the original timetable the government
1:11:07 > 1:11:10laid down. You're absolutely right, the Prime Minister keeps referring
1:11:10 > 1:11:15to an intimidation period and I don't have a crystal ball, I don't
1:11:15 > 1:11:19know if we'll be proven to be right, I myself find it very hard indeed to
1:11:19 > 1:11:27believe a set of trade talks that can only start in March are going to
1:11:27 > 1:11:33be anywhere near even the end of the preliminary stage by the time this
1:11:33 > 1:11:38agreement has to be signed in October.I completely agree.I will
1:11:38 > 1:11:42maybe push the buy little further. The government White Paper from
1:11:42 > 1:11:48debris this year set out that timescale, that we will have a
1:11:48 > 1:11:54withdrawal agreement with a future framework agreements by the time we
1:11:54 > 1:11:59leave. Then there will merely be an implementation period for the
1:11:59 > 1:12:02gradual bringing into force of the new framework relationship. That was
1:12:02 > 1:12:06immediately contradicted. It had already been contradicted by most of
1:12:06 > 1:12:10the people who work in the field, like me, who said the timescale was
1:12:10 > 1:12:14not very credible. And legally speaking the EU cannot negotiate a
1:12:14 > 1:12:17trade agreement with a member state, only with a third country, so you
1:12:17 > 1:12:21have to wait until after you've left. Those positions were affirmed
1:12:21 > 1:12:23by the European Council, by the council, commission, European
1:12:23 > 1:12:29Parliament. The Florence speech in September was the government's
1:12:29 > 1:12:34admission that it had miscalculated the timing the Prime Minister
1:12:34 > 1:12:39recalibrated the government strategy in Florence, and said, we're looking
1:12:39 > 1:12:43at a withdrawal agreement, and discussions about the framework for
1:12:43 > 1:12:47the future. But explicitly recognise that could not be progressed and
1:12:47 > 1:12:51concluded until after withdrawal. The language of intimidation period
1:12:51 > 1:12:55was retained but the reality is the intimidation period as it was
1:12:55 > 1:13:01originally meant in the White Paper is no longer the case, we're now
1:13:01 > 1:13:04talking about a transition period. The answer I gave earlier, you could
1:13:04 > 1:13:08almost say it is the EU's recognition that has happened within
1:13:08 > 1:13:12the UK. OK, we'll no longer wait until we have a clear idea of the
1:13:12 > 1:13:16future relationship before we start talking transition, we'll just start
1:13:16 > 1:13:19talking transition now because we all know the context has changed. I
1:13:19 > 1:13:23think there has been a very significant change in events. I
1:13:23 > 1:13:31think we still use the term, not I, but some people use the term
1:13:31 > 1:13:33intimidation period to give the impression of continuity, not much
1:13:33 > 1:13:35has changed, it's been a very significant shift in government
1:13:35 > 1:13:38policy, even if it is difficult to admit it more publicly than we'd
1:13:38 > 1:13:42feel comfortable.Do you think... Sorry.I would agree with most of
1:13:42 > 1:13:49that, the other thing I would add, as far as the EU is concerned, the
1:13:49 > 1:13:52special relationship is not just a trade. We're going to have to talk
1:13:52 > 1:13:57about migration, security, research and develop and come all the other
1:13:57 > 1:14:04programmes the UK is currently part of. So I think using language of
1:14:04 > 1:14:07implementation, there may well be issues we can resolve sooner rather
1:14:07 > 1:14:12than later in that transitional phase as a result of negotiating the
1:14:12 > 1:14:17wider future partnership. We may well implement a new policy on by,
1:14:17 > 1:14:21Y, Z, which isn't necessarily the trade deal. I agree with the general
1:14:21 > 1:14:28sentiment, we're not going to the detail of a trade agreement by 2019.
1:14:28 > 1:14:33I do think the UK, the fact that the withdrawal agreement is tied to the
1:14:33 > 1:14:41future framework agreement, the UK, I think, rightly can insist to have
1:14:41 > 1:14:43a fairly detailed discussion about what that future framework is
1:14:43 > 1:14:47looking like Amanda the sense of direction. I think if the UK doesn't
1:14:47 > 1:14:51feel there is a sense of direction being agreed with EU, the EU will
1:14:51 > 1:14:54say we're not go to sign a withdrawal agreement, you're not
1:14:54 > 1:14:57going to have the money. That is always going to be an option open to
1:14:57 > 1:15:01you at that point if the government feels it is necessary.
1:15:01 > 1:15:07And that would be October on the timetable, October 2018?In that
1:15:07 > 1:15:11situation I think it would be one minute to midnight of March 2019 but
1:15:11 > 1:15:17ideally it needs to be wrapped up by October 20 18.European Parliament
1:15:17 > 1:15:23has to ratify, that is where the timeline comes from.Michel Barnier
1:15:23 > 1:15:27has been working, it seems sensible to me, since the 29th of March, it
1:15:27 > 1:15:34seemed to be nonsense to me. I should really be concentrating
1:15:34 > 1:15:42around 2018.They feel that there has been no progress whatsoever on
1:15:42 > 1:15:45discussing the future framework, then we could time out. It is still
1:15:45 > 1:15:52a possibility.Despite our fears, I think the main losers are simply
1:15:52 > 1:15:56walking away from negotiations. Remember, the bulk of negotiations
1:15:56 > 1:16:01are about what do we do with people who currently have licenses or
1:16:01 > 1:16:05permits to do their job, what will happen to those people's lives. What
1:16:05 > 1:16:09do we do with intellectual property rights that have currently been
1:16:09 > 1:16:15granted and recognised under EU law? Were they disappear? The range of
1:16:15 > 1:16:19issues being dealt with under the separation part of the withdrawal
1:16:19 > 1:16:22agreement should not be so politically controversial, some of
1:16:22 > 1:16:26them are but they should not all be. They will directly affect the lives
1:16:26 > 1:16:30and livelihoods of millions of people. I do think to simply say
1:16:30 > 1:16:33relatively at the last minute because we are not getting our way
1:16:33 > 1:16:37on the future trade relationship, it is not moving as fast as we would
1:16:37 > 1:16:42like, when told repeatedly that it will not move that fast, we will be
1:16:42 > 1:16:48cutting our nose off to spite our face. It would be damaging for
1:16:48 > 1:16:50ourselves, our businesses, our citizens and our economy that would
1:16:50 > 1:16:56suffer the consequences. This does not come across as very credible. We
1:16:56 > 1:17:00all want to get an agreement and we all want to stop damage being done
1:17:00 > 1:17:04to people in their lives and businesses. I do think to link up in
1:17:04 > 1:17:08this highly contingent way, the separation issues with the future
1:17:08 > 1:17:15relationship issues, it's not coming across terribly credibly.But isn't
1:17:15 > 1:17:19that probably the government's strategy? To stop me from
1:17:19 > 1:17:25complaining at this time about what is going on, and by the time we get
1:17:25 > 1:17:28to October 2018, the government would say, you were probably right
1:17:28 > 1:17:33but we are too far down the road. We cannot possibly have a no deal.
1:17:33 > 1:17:39Wouldn't that be quite reasonable? Not a fudge gratitude that
1:17:39 > 1:17:43diplomatic strategy.But the compelling argument about no deal is
1:17:43 > 1:17:46not that we've wasted time and effort negotiating a deal but as
1:17:46 > 1:17:52Michael said, the sheer human cost of no deal.That you could do no
1:17:52 > 1:17:56deal now and tell British industry that you are coming back out of
1:17:56 > 1:18:05global trade rules and up to March 2019, you can't do that. Into the
1:18:05 > 1:18:12end of October 2018, but...It would make no difference, in a situation
1:18:12 > 1:18:15that I mentioned before, we are effectively asking every other
1:18:15 > 1:18:23member of the WTO to regulate our membership statement is we've got --
1:18:23 > 1:18:27because we don't know the terms of our relationship. To say no deal now
1:18:27 > 1:18:32is no different to say no deal in 2018. We are not in a position to
1:18:32 > 1:18:36cope with the consequences without causing enormous damage to our
1:18:36 > 1:18:42economy and society.There could be some huge damage if they decided to
1:18:42 > 1:18:48go at it alone, is that the case? Some huge damage would be done to
1:18:48 > 1:18:51the British economy. The fifth biggest economy in the world, just
1:18:51 > 1:19:00because it makes a decision?One of the issues is Article 50, that is
1:19:00 > 1:19:06sorting out the loose ends of membership which is to do with
1:19:06 > 1:19:08issues of legal certainty, regulation, safety industries like
1:19:08 > 1:19:12the airline industry where everybody has an interest in getting this
1:19:12 > 1:19:18agreement, it makes life easier for everyone but then there is the issue
1:19:18 > 1:19:22of going back on world trade terms if we got the Article 50 deal. Most
1:19:22 > 1:19:26economists would think that is less good for the economy than other
1:19:26 > 1:19:30options, then having a deep and meaningful trading relationship with
1:19:30 > 1:19:33the EU, I don't think anyone is suggesting that would be Armageddon
1:19:33 > 1:19:36but the real nightmare scenario would be not having the Article 50
1:19:36 > 1:19:44deal. It all is drained and it's important to distinguish between the
1:19:44 > 1:19:55two.I think that no deal is desirable. I'm pointing out the fact
1:19:55 > 1:19:58that the UK can hold the position that nothing is agreed until
1:19:58 > 1:20:05everything is agreed until it so wishes. That might be difficult at
1:20:05 > 1:20:16that point.We spent quite a long time talking about the options for
1:20:16 > 1:20:22Ireland and the Republic of Ireland, and looked at the deals and what
1:20:22 > 1:20:30could be possible. It seems to me that there are two things that are
1:20:30 > 1:20:34movable, the UK and Northern Ireland will leave the EU at some point in
1:20:34 > 1:20:37the process. The peace process in Northern Ireland, the Good Friday
1:20:37 > 1:20:43Agreement, the Belfast agreement, it has to be maintained in its entirety
1:20:43 > 1:20:50and everybody wants to make sure these two things are delivered. If
1:20:50 > 1:20:54as some are still proposing that we leave the EU without a deal
1:20:54 > 1:20:58whatsoever, what happens to all of this talk about deals and
1:20:58 > 1:21:01compromises and negotiations around the border of Northern Ireland? Does
1:21:01 > 1:21:07that all go as well? What happens to the external EU border between the
1:21:07 > 1:21:11Republic of Ireland and the UK, in the event of us living without any
1:21:11 > 1:21:19deal whatsoever?There would be a hard border, a normal EU external
1:21:19 > 1:21:23border. I know that the Secretary of State in the EU wants talked about
1:21:23 > 1:21:27the fact that even if we crash out with no deal we could deal with
1:21:27 > 1:21:33issues bilaterally to avoid some of the worst. The political fallout of
1:21:33 > 1:21:38a decision to simply walk would be such that I do not think we will
1:21:38 > 1:21:41find any willing negotiating partners on the other side of the
1:21:41 > 1:21:48table either. They have politics too. It becomes a political storm in
1:21:48 > 1:21:52all member states. The notion of us doing any sort of meaningful
1:21:52 > 1:21:57business having walked in the short-term strikes me as fanciful.
1:21:57 > 1:22:00The other witnesses may want to comment, particularly in relation
1:22:00 > 1:22:07to...To nuance in reply to Sammy Wilson's question, we should
1:22:07 > 1:22:10disaggregate the different kinds of borders that we are talking about.
1:22:10 > 1:22:14No deal for Northern Ireland would be a catastrophe, it's fair to say.
1:22:14 > 1:22:19The customs and regulatory borders would be there, it isn't just a
1:22:19 > 1:22:23matter of the EU imposing its border, the UK would have
1:22:23 > 1:22:26obligations under international law to impose and police its Customs
1:22:26 > 1:22:30border as well. The fact we do not know what our customs policy is yet
1:22:30 > 1:22:33could be hiding the problem but is not resolving the problem. We would
1:22:33 > 1:22:41be obliged under the WTO to have our own customs and checks, it isn't
1:22:41 > 1:22:44purely on the EU side but we should disaggregate the different kinds of
1:22:44 > 1:22:47border, there's nothing to stop Ireland and the UK from maintaining
1:22:47 > 1:22:51the Common travel area at least. Even if there were customs and
1:22:51 > 1:22:54regulatory problems, there would be no need for persons checks and
1:22:54 > 1:23:09passport checks. Either between Ireland and the Republic of Ireland.
1:23:09 > 1:23:12On the at that point it will be a signal relations are so low that it
1:23:12 > 1:23:19would be difficult to organise anything effectively at that point.
1:23:19 > 1:23:28Thank you. I want to come onto three Q stands. We are so concerned with
1:23:28 > 1:23:31Northern Ireland, we cannot spend as much time on that this morning as
1:23:31 > 1:23:40much as we would have liked to. What happens to all of the agreements
1:23:40 > 1:23:44that have been reached so far in the event of a no deal, do those
1:23:44 > 1:23:52agreements get put on the back burner? I am seen nodding heads!
1:23:52 > 1:23:59Yes, this agreement has yet to be put into legal text and ratified. I
1:23:59 > 1:24:03do think that is one area where I think there would be a strong moral
1:24:03 > 1:24:09and political case for both sides to resurrect that element of the deal
1:24:09 > 1:24:12because the deal effectively has been done. As Michael said, this is
1:24:12 > 1:24:17the closest we've got in the agreement to nail down a solution to
1:24:17 > 1:24:22some of the issues that have been raised. The option would always be
1:24:22 > 1:24:30open to recover that part of it but struck me speaking, yes.The British
1:24:30 > 1:24:37public could decide to legislate, as it has two, as a gesture of
1:24:37 > 1:24:43goodwill, you can resurrect parts of this agreement but the bit that
1:24:43 > 1:24:46involves it, about oversight, reciprocal rights, that would all go
1:24:46 > 1:24:52and it's up to each side to do it individually?There would be certain
1:24:52 > 1:24:56consequences, a lot of citizens rights could be adopted
1:24:56 > 1:24:59unilaterally, they could say that they are still going to guarantee
1:24:59 > 1:25:03this list of things for current migrants but it would not work for
1:25:03 > 1:25:08everything. A good example would be social security coordination. If you
1:25:08 > 1:25:14are a UK national living in Spain dependent on the exportation of a UK
1:25:14 > 1:25:18passport at the operated rates, and suddenly that agreement no longer
1:25:18 > 1:25:22exists with no means of carrying on the coordination system, that would
1:25:22 > 1:25:25have a tangible impact on you. You might have your residence rights,
1:25:25 > 1:25:30but they will not mean much if you cannot afford to eat or pay your
1:25:30 > 1:25:37rent.And that applies to health? Yes.That could be done bilaterally
1:25:37 > 1:25:42between member states. In theory. The UK could negotiate bilaterally
1:25:42 > 1:25:47with individual states.So essentially no deal is a bad idea
1:25:47 > 1:25:51and we need to mitigate against the consequences of no deal, so we
1:25:51 > 1:25:56should look at other deals elsewhere? Are we effectively saying
1:25:56 > 1:26:00the way to mitigate against the damage caused by no deal is to look
1:26:00 > 1:26:06for lots of little individual deals, either bilaterally or...I don't
1:26:06 > 1:26:11think so. If you were in that situation, there would be other
1:26:11 > 1:26:15remedies. If the relationship with the EU via the commission had broken
1:26:15 > 1:26:17down, there would be opportunities to revisit with other member state
1:26:17 > 1:26:27governments.It's an area where the EU has little with other
1:26:27 > 1:26:31organisations with. It's often done bilaterally but that would not be
1:26:31 > 1:26:38the case in customs.Bearing in mind that political agreement depends on
1:26:38 > 1:26:44mutual goodwill, even bilaterally. That would be in short supply.There
1:26:44 > 1:26:48seems to be a general recognition that we are not going to face the
1:26:48 > 1:26:53doomsday scenario of either EU nationals in the UK or UK nationals,
1:26:53 > 1:27:03it's unlikely that anything will be done but it still to be agreed what
1:27:03 > 1:27:09rights we will enjoy it, like health care, access to family members and
1:27:09 > 1:27:13if you move to other parts of the EU. It's likely all of these will be
1:27:13 > 1:27:19covered in the second stage of the negotiations but what are the
1:27:19 > 1:27:24potential barriers to achieving an agreement? Given that both sites
1:27:24 > 1:27:29have said they want to respect the rights of citizens as far as
1:27:29 > 1:27:33possible? What could get in the way of reaching an early agreement?
1:27:33 > 1:27:38Particularly on those matters.If I come to that point we just
1:27:38 > 1:27:46discussed, what kind of partnership are we looking at and is migration
1:27:46 > 1:27:52going to be traded off in terms of market access and the overall trade
1:27:52 > 1:27:55relationship? Optimally, some of these issues, if we become a third
1:27:55 > 1:28:00country, it would be down to individual member states. In an
1:28:00 > 1:28:04individual scenario, they could decide the immigration status of
1:28:04 > 1:28:07nationals entering their country. The question is, what ambition are
1:28:07 > 1:28:14we aiming for in the deal? Will the EU negotiate as a block on these
1:28:14 > 1:28:23issues, ultimately we don't know. For what the UK is looking at.It's
1:28:23 > 1:28:29a different shape between the issue of people already in situ, clearly
1:28:29 > 1:28:33and Article 50 issue and the future immigration policy. It seems to me,
1:28:33 > 1:28:41on the former issue, the family unification could be problematic
1:28:41 > 1:28:46there are certain provisions to discourage people from coming. I
1:28:46 > 1:28:49detect an unwillingness on both sides to compromise on that. The
1:28:49 > 1:28:55second is a question for Michael, reading the text of what has been
1:28:55 > 1:28:58agreed, I do wonder whether this is not an area where, should disappear
1:28:58 > 1:29:04before the EU Court of Justice, notions of due regard to the ECJ may
1:29:04 > 1:29:17appear a little Woolley for a court to sign off?We should differentiate
1:29:17 > 1:29:20between current migrants and future immigration relations between the EU
1:29:20 > 1:29:24and UK. In terms of current migrants, looking at the list of
1:29:24 > 1:29:28issues left open by the report still to be
1:29:31 > 1:29:37settled, there is a mechanism for incorporating future changes to
1:29:37 > 1:29:41social security coordination. These are not big issues, they should not
1:29:41 > 1:29:45cause a failure of negotiations. They may be technical and could race
1:29:45 > 1:29:48typical questions but they are perfectly resolvable. The other
1:29:48 > 1:29:52issues are ones that are on the agenda for the future but not
1:29:52 > 1:29:56necessarily going to reopen. We mentioned before the European
1:29:56 > 1:29:58Parliament uses different phraseology and would like to extend
1:29:58 > 1:30:01the benefits of the citizens rights agreements to other categories of
1:30:01 > 1:30:07people. But it is pretty near complete.
1:30:07 > 1:30:13On the governance question raised, it's probably worth pointing out
1:30:13 > 1:30:16that actually what has been agreed in the citizens rights part when it
1:30:16 > 1:30:20comes to the treatment of the European Court of Justice is
1:30:20 > 1:30:23virtually identical to what is proposed under the European Union
1:30:23 > 1:30:28withdrawal bill when it comes to the treatment of case law from the
1:30:28 > 1:30:31European Court of Justice. Pre-withdrawal cases will be binding
1:30:31 > 1:30:35precedents with the status of UK Supreme Court judgments under the
1:30:35 > 1:30:41bill, binding precedents for the citizens rights. Future case you
1:30:41 > 1:30:44law, will have due regard to it under the bill, under the agreement
1:30:44 > 1:30:49there will be due regard. I can't remember the exact words, but we'll
1:30:49 > 1:30:59take it into account. ...It need not have regard in the bill.The
1:30:59 > 1:31:02next draft clause under the bill, all actions of the EU institutions
1:31:02 > 1:31:07which includes...I would suggest it very different to what has been
1:31:07 > 1:31:11agreed in relation to the citizens, which is that the courts in the UK
1:31:11 > 1:31:19will, and I quote, pay due regard to relevant decisions. I'm very seized
1:31:19 > 1:31:25on this because I had an amendment to the bill, one 37. Two are meant
1:31:25 > 1:31:28to read that courts in the UK should pay due regard to relevant
1:31:28 > 1:31:34decisions. Now that amendment had the support of all opposition
1:31:34 > 1:31:38parties apart from the DUP and was only narrowly defeated. Now the
1:31:38 > 1:31:42Prime Minister has agreed that will be the test in relation to European
1:31:42 > 1:31:46citizens. For the record we have to be quite careful here because there
1:31:46 > 1:31:53is quite a different emphasis.I apologise, to broad brush.It's my
1:31:53 > 1:31:56hobby horse, I apologise.The systems are not identical, I
1:31:56 > 1:32:00apologise. I was making the point they are Copper Box more to focus on
1:32:00 > 1:32:05where the contrast is, the much more significant contrast. I'm sorry if I
1:32:05 > 1:32:09wasn't accurate enough on that point. Where the big contrast is is
1:32:09 > 1:32:13the potential to make preliminary references to the Court of Justice.
1:32:13 > 1:32:18For eight years after the enforcement of the citizens rights
1:32:18 > 1:32:21provisions, that is where there is a significant events between the
1:32:21 > 1:32:27European Union withdrawal bill and citizens rights provisions. It's not
1:32:27 > 1:32:33a huge change from the system as it is today but it's a major point of
1:32:33 > 1:32:36comparison with the European Union withdrawal bill.One further
1:32:36 > 1:32:44question. As recently as last week, the Brexit secretary and the Prime
1:32:44 > 1:32:48Minister were both still repeating the phrase that no deal is better
1:32:48 > 1:32:54than a bad deal. Can any of you envisage any credible scenario for
1:32:54 > 1:32:58David Davis and his colleagues coming back with a proposed deal
1:32:58 > 1:33:02that was so bad it would be better to walk out and suffer the various
1:33:02 > 1:33:08implications? Is it possible to imagine a bad deal so bad that no
1:33:08 > 1:33:13deal would be better?Personally, the test of a bad deal is less
1:33:13 > 1:33:19economic and more political. A bad deal would be one in which the EU
1:33:19 > 1:33:22said, you can have access to the single market but only if you follow
1:33:22 > 1:33:26our rules and regulations in perpetuity. That would be a bad deal
1:33:26 > 1:33:29for the United Kingdom because that would mean we would lose our say and
1:33:29 > 1:33:33for ever be dependent on access to the single market, that would be a
1:33:33 > 1:33:41bad deal.What about a future deal that would not be what we're talking
1:33:41 > 1:33:46about under Article 50. I can't imagine a situation where that would
1:33:46 > 1:33:50happen, it would reflect badly on the negotiating prowess of the
1:33:50 > 1:33:52British government if they fail to achieve it.Particularly given where
1:33:52 > 1:34:00we've got to.Joanna Cherry...A brief revisiting of this
1:34:00 > 1:34:05transitional in fermentation period. There is clearly, it seems to me it
1:34:05 > 1:34:09is clear, there is a degree of diversions between what the United
1:34:09 > 1:34:13Kingdom and EU envisage for the transitional or implementation
1:34:13 > 1:34:17period. I wonder if I could clarify what each of you gentlemen envisage.
1:34:17 > 1:34:22Will we be in the single market during the transitional or
1:34:22 > 1:34:27implementation period? Do you have a view on that?Yeah, I think the
1:34:27 > 1:34:30language used by Donald Tusk was interesting. He said continued
1:34:30 > 1:34:33membership of the single market and Customs union, the government
1:34:33 > 1:34:36position is we'll leave the single market and Customs union and
1:34:36 > 1:34:43recreate the same thing. I think it's a semantic difference.In a
1:34:43 > 1:34:47statement of the Commons on Monday the Prime Minister said, as I
1:34:47 > 1:34:50proposed in Florence during the strictly time-limited in
1:34:50 > 1:34:54fermentation period, which we will now begin to negotiate, we will not
1:34:54 > 1:34:57be in a single market customs union as we will have left the European
1:34:57 > 1:35:02Union. Clearly Donald Tusk seems to envisage the opposite, that we will
1:35:02 > 1:35:11be in the single market and customs union.Strictly speaking, the
1:35:11 > 1:35:14differences will be bound by the rules but have no say in the new
1:35:14 > 1:35:23rules. It is a different status.We won't be a member state.The single
1:35:23 > 1:35:27market is the European Union body, it couldn't be more simple.I think
1:35:27 > 1:35:31it's more congregated than that. The first question is, what form, what
1:35:31 > 1:35:36legal form transition takes. I suggested earlier one option that
1:35:36 > 1:35:41has perhaps been under explored but might be worth exploring further
1:35:41 > 1:35:49is... The institutional provision to which allow voting by the UK in the
1:35:49 > 1:35:52institutions introduced in 2019. That's it, once you've gone that far
1:35:52 > 1:35:58it's not going to go back. The substantive provisions on the single
1:35:58 > 1:36:00market, customs union environment and so on will continue to a later
1:36:00 > 1:36:06date of entry. We effectively in and out at the same time for different
1:36:06 > 1:36:09purposes. It would solve many of the problems if you were willing to buy
1:36:09 > 1:36:12it it would solve many of the problems we are talking about. It
1:36:12 > 1:36:16would mean technically we're in a single market and customs union and
1:36:16 > 1:36:21other new date of entry comes in. Otherwise it's playing around with
1:36:21 > 1:36:25semantics. We have the experience of the day, many people will casually
1:36:25 > 1:36:29talk about Norway, Iceland and Liechtenstein being members of the
1:36:29 > 1:36:32single market. We can have other people who say they are not strictly
1:36:32 > 1:36:37members of the single market, they participate in the European Economic
1:36:37 > 1:36:40Area which seeks to recreate the single market between the EU and
1:36:40 > 1:36:44those countries. With semantics. I don't think it's as important as
1:36:44 > 1:36:49where the points of difference and discussions remain to be resolved.
1:36:49 > 1:36:54What about the Court of justice during the transition or
1:36:54 > 1:36:56implementation period? The courts of the United Kingdom, will they still
1:36:56 > 1:37:02be subject to rulings of the court? Will courts in the United Kingdom
1:37:02 > 1:37:08still be able to make references to it during the transitional
1:37:08 > 1:37:12implementation period, what are the views on that?I think the EU
1:37:12 > 1:37:15position is yes. As far as I understand the government position
1:37:15 > 1:37:19is also yes.So that is one red line that has gone.I think it's a time
1:37:19 > 1:37:26limit. The point is...I've asked it a million times and not got a clear
1:37:26 > 1:37:36answer.I think the point is this is a time-limited period, as has been
1:37:36 > 1:37:42discussed by many people earlier, to secure a Brexit, an orderly Brexit,
1:37:42 > 1:37:45they have two Nick Compton misers on the way there. I don't think it's a
1:37:45 > 1:37:53big problem if this only aim period until 2020.A minor qualification,
1:37:53 > 1:37:57one of my points of diversion, the government has suggested it would
1:37:57 > 1:38:02like to bring forward alternative dispute settlement mechanism is
1:38:02 > 1:38:06earlier than the expiry of the transition period. It clearly
1:38:06 > 1:38:09envisaging though we might start off with a situation where full
1:38:09 > 1:38:14references can be made to the Court of Justice, new caselaw is binding
1:38:14 > 1:38:17in its interpretation of EU law on UK courts, the government would like
1:38:17 > 1:38:21to see that phased out before the rest of the transitional agreement.
1:38:21 > 1:38:24The EU says nothing about the phasing out in its guidelines, it
1:38:24 > 1:38:28might be an omission because they didn't think about it, or a clear
1:38:28 > 1:38:35statement that it's not what we have in mind.OK. On this very point...
1:38:35 > 1:38:43The separate adjudication mechanisms. How much divergences
1:38:43 > 1:38:46from the ECJ would there be? Would we end up with something fairly
1:38:46 > 1:38:54similar?I think it's very hard to say because this hasn't been fleshed
1:38:54 > 1:39:03out by the government, to be honest. As far as I know that is as far as
1:39:03 > 1:39:07they've gone. There has been no detail added to that.We could in
1:39:07 > 1:39:10theory end up with something very similar?I think it goes back to the
1:39:10 > 1:39:14current speech in which the Prime Minister talks about three areas in
1:39:14 > 1:39:17which we might want to achieve the same objective by the same means,
1:39:17 > 1:39:21same objective by different means. If we try to achieve the same by the
1:39:21 > 1:39:24same means, we'll look at something very similar. In the areas we want
1:39:24 > 1:39:27to do it by different means, we'll look for differences. It comes back
1:39:27 > 1:39:31to where we put the different baskets of issues, or industry
1:39:31 > 1:39:37sectors, into those different categories.Jeremy Lefroy.Thank
1:39:37 > 1:39:43you, it's just to obtain some clarification. The idea of no deal
1:39:43 > 1:39:49has been put over as if it was a single issue, whereas from what
1:39:49 > 1:39:53you've all been saying, we're really talking about two completely
1:39:53 > 1:39:56different things. There is no deal in relation to effectively the
1:39:56 > 1:40:05withdrawal agreement, which may have some heads of agreement for a
1:40:05 > 1:40:08potential for the future relationship with the European
1:40:08 > 1:40:10Union, it's likely to have some agreement, but no more than that.
1:40:10 > 1:40:15Then there would be no deal on a future trade deal or relationship,
1:40:15 > 1:40:21is that correct?Yes, I think there is more nuanced about, there is a
1:40:21 > 1:40:25difference between no trade agreement and no preferential trade
1:40:25 > 1:40:30agreement, and a no deal scenario in which we have various agreements on
1:40:30 > 1:40:34aviation or mutual recognition of customs procedures and so on. There
1:40:34 > 1:40:39are shades of grey even on no deal in terms of the future partnership.
1:40:39 > 1:40:42ASBOs analytically you might want a distinction between no trade deal
1:40:42 > 1:40:46and a trade deal that fails to get ratified. We've agreed on a deal but
1:40:46 > 1:40:51the roadblock is political rather than part of the negotiations.What
1:40:51 > 1:40:56we're really talking about now is in October having a deal on the
1:40:56 > 1:40:59withdrawal agreement and that is pretty much it.Yes.But with the
1:40:59 > 1:41:06idea there will be... We will be in the middle, the start of
1:41:06 > 1:41:09negotiations on future trading relationships, which is likely to go
1:41:09 > 1:41:12on for at least two years and possibly longer at the end of which
1:41:12 > 1:41:16there will be ratification which has to go through all 35, however many
1:41:16 > 1:41:23it is now.There is a risk in overstating the uncertainty we will
1:41:23 > 1:41:29have at that point about where we're heading. It is the EU... Charbonnier
1:41:29 > 1:41:33saying the UK must choose between being like Norway like Canada. The
1:41:33 > 1:41:37EU is my things, prepared to engage in a high-level discussion about
1:41:37 > 1:41:40what the future relationship should look like. The EU is quite clear
1:41:40 > 1:41:43we're not going to have it all written down in black and white in
1:41:43 > 1:41:46terms of the trade agreement but the EU is quite concerned about being
1:41:46 > 1:41:52engage with a discussion about determining whether UK is heading.
1:41:52 > 1:41:55There is a risk we say, we'll have the withdrawal agreement and heads
1:41:55 > 1:41:59of terms and not much else. I think there will be a detailed discussion
1:41:59 > 1:42:02at that point about is the UK going to be aligned with the single market
1:42:02 > 1:42:07or not? The EU is saying to the government, decide. Presumably what
1:42:07 > 1:42:09they want us to decide because they want to discuss the answer to that
1:42:09 > 1:42:17question. You talk about an overall understanding of the future of the
1:42:17 > 1:42:20framework.This will be a political declaration included in the
1:42:20 > 1:42:23withdrawal agreement, a slightly different status they anticipate
1:42:23 > 1:42:27that part as opposed to the rest of the withdrawal agreement.The main
1:42:27 > 1:42:30issue will be whether the political declaration of the overall
1:42:30 > 1:42:34understanding will have reached a stage where its details and if we
1:42:34 > 1:42:39can basically say, this is for translation into legal text because
1:42:39 > 1:42:42the scope of cooperation, the instruments of Corporation, the
1:42:42 > 1:42:47institutions and governance arrangements have been agreed
1:42:47 > 1:42:50politically and now it is the transition into a legal text. Or
1:42:50 > 1:42:54whether we've reached the point where we said, we like the idea of
1:42:54 > 1:42:57being good friends into the future, these are the fields of cooperation,
1:42:57 > 1:43:01but we haven't got much further than that. In which case there will be a
1:43:01 > 1:43:04lot of work to be done even at the political level after withdrawal. In
1:43:04 > 1:43:08any event when we talk about no deal now, we talk about no deal in the
1:43:08 > 1:43:12sense of no separation agreement to deal with all of the issues that
1:43:12 > 1:43:16need to be addressed for an orderly withdrawal. There is no real
1:43:16 > 1:43:21prospect of a deal on the future relationship which equates to a full
1:43:21 > 1:43:26and final agreement on trade security for the future.Thank you
1:43:26 > 1:43:33very much. Stephen Timms.First of all ask Professor double, your
1:43:33 > 1:43:37comments about what happened in west Ukraine and Poland joined the
1:43:37 > 1:43:40European Union, what was the effect on the economy of west Ukraine when
1:43:40 > 1:43:43that happened in the way you describe?A pretty immediate
1:43:43 > 1:43:48negative impact on the economy in western Ukraine.How severe?I don't
1:43:48 > 1:43:53have the numbers to hand but in a sense it in Poland and western
1:43:53 > 1:43:56Ukraine, there wasn't much of a border, it was a pretty integrated
1:43:56 > 1:44:00economic area at the time. The western part was more prosperous
1:44:00 > 1:44:03than the eastern part, because Poland is more prosperous than
1:44:03 > 1:44:07Ukraine. Being cut off from that market had very obvious negative in
1:44:07 > 1:44:10provisions for the western part of Ukraine. They had to basically deal
1:44:10 > 1:44:14with the shock and reorientate their trade back to the rest of the
1:44:14 > 1:44:18country because of the border.I don't know whether there is an
1:44:18 > 1:44:21account readily available but if there was it would be interesting to
1:44:21 > 1:44:24know what happened in that situation because...I can certainly have a
1:44:24 > 1:44:29look.I would welcome that. Going back to the question of the Northern
1:44:29 > 1:44:33Ireland- Ireland border, if the commitment to no physical
1:44:33 > 1:44:39infrastructure on that border is maintained, how likely is it in your
1:44:39 > 1:44:48view that the UK will be forced to stay in the customs union?
1:44:48 > 1:44:52The first thing I would say is actually if there is no physical
1:44:52 > 1:44:56infrastructure I think it is customs union and single market because both
1:44:56 > 1:44:59would require physical infrastructure and as Michael said,
1:44:59 > 1:45:05the wording is quite... Draconian in terms of we are not going to have...
1:45:05 > 1:45:09However, I don't know. It depends on the political trade-offs the
1:45:09 > 1:45:11government is willing to make and who the government is willing to
1:45:11 > 1:45:18annoy.I go further and asked the question correctly, I would ask the
1:45:18 > 1:45:25question very directly to the Northern Irish parties, given that
1:45:25 > 1:45:29the UK is placing this decision primarily in the hands of Northern
1:45:29 > 1:45:31Irish parties, it's essentially saying that they can tell us what is
1:45:31 > 1:45:37going to happen. I think the deal that is basically being offered to
1:45:37 > 1:45:39the Northern Irish parties says, would you like to stay in the single
1:45:39 > 1:45:43market with the customs union and the republic so as not to have a
1:45:43 > 1:45:49hard border but we guarantee lopsided privileged access to the
1:45:49 > 1:45:52market and GB all in one direction. For Northern Irish parties it may
1:45:52 > 1:45:57seem like a good deal, so far it is workable and we talked before about
1:45:57 > 1:46:05the issues of what firm alignment means and whether unilateral would
1:46:05 > 1:46:12make a difference anyway. The ball is in the hands of the Northern
1:46:12 > 1:46:19Ireland Court. A sickly, they are getting a lopsided advantage. They
1:46:19 > 1:46:29could have it both ways, if that's the direction they want it go to.If
1:46:29 > 1:46:32that's an issue, then the Irish government being able to have easy
1:46:32 > 1:46:37access to a GB market... It would also mean there are physical checks
1:46:37 > 1:46:41between GB and the Irish Republic? Yes, that's why none of these
1:46:41 > 1:46:48solutions are perfect.This is a 3-way issue and I think it will
1:46:48 > 1:46:52require a compromise to achieve that. Outside the customs union and
1:46:52 > 1:46:55without the physical infrastructure the border would require all sides
1:46:55 > 1:46:59to compromise. At the moment is difficult to know what the
1:46:59 > 1:47:01compromise is, we are currently talking about customs union
1:47:01 > 1:47:06membership being and white. I think there may be prospects where if you
1:47:06 > 1:47:11narrow it down to the sectors where it really matters on the island of
1:47:11 > 1:47:20Ireland, perhaps customs is not black and white.Thank you.The
1:47:20 > 1:47:24question of whether we go to full alignment, does that need to be
1:47:24 > 1:47:28resolved before we start trade negotiations, or could we start the
1:47:28 > 1:47:33negotiations without knowing whether we will have full alignment with the
1:47:33 > 1:47:44single market and the customs union? In the context of Northern Ireland?
1:47:44 > 1:47:47In transition I think the government wants to negotiate these trade
1:47:47 > 1:47:52agreements. Can they do that if at that point we do not know whether we
1:47:52 > 1:47:57are going to end up with full alignment with the union and the
1:47:57 > 1:48:03single market? I think they would signal a willingness in terms of
1:48:03 > 1:48:08turning a blind eye to negotiations but the real question is whether
1:48:08 > 1:48:11negotiating partners would commit to anything, not knowing what our
1:48:11 > 1:48:14relationship with the single market is going to be. That would affect
1:48:14 > 1:48:22the nature of the deal.Looking at the circumstances we found ourselves
1:48:22 > 1:48:26in, what the UK is likely to achieve in terms of trade deals within the
1:48:26 > 1:48:30time we've got, bearing in mind our limited experience and capacity to
1:48:30 > 1:48:34do it in the first place, I'm aware that fundamental pieces of the
1:48:34 > 1:48:39puzzle, like our WTO membership, have not been regularised. I would
1:48:39 > 1:48:42not get ambitious about what we would achieve in trade deal terms
1:48:42 > 1:48:46within the transition period. I think that's one of the reasons why
1:48:46 > 1:48:49the EU institutions are relaxed about it. They will be thinking, we
1:48:49 > 1:48:53aren't going to get much done anyway. It is not an enormous
1:48:53 > 1:49:01concession to say we aren't happy. You'd explain to us during the
1:49:01 > 1:49:05transition period, that we will sort of be in the single market of the
1:49:05 > 1:49:12customs union but not in depending on who you ask... But it is clear
1:49:12 > 1:49:20that we will have repealed the European community act of 1972. I
1:49:20 > 1:49:24wonder, are the legal mechanisms to deliver the requirements of being in
1:49:24 > 1:49:34the single market, are those legal matters going to be in place during
1:49:34 > 1:49:37that time?It links up with the legal vehicle for the transitional
1:49:37 > 1:49:42period in the first place. For example, if we did have a
1:49:42 > 1:49:46differentiated date of entry into the force for different provisions
1:49:46 > 1:49:50of the withdrawal agreement, and that was our transitional vehicle of
1:49:50 > 1:49:53leaving the institutions which basically means we were leaving, but
1:49:53 > 1:49:58were not making substantive rules for another two years, then it means
1:49:58 > 1:50:04the withdrawal bill differentiates an exit days, these bits of the
1:50:04 > 1:50:07withdrawal bill only enter into force after the two-year period is
1:50:07 > 1:50:13up. Because we want to keep the easy flow of new regulations, we want to
1:50:13 > 1:50:18implement new rules or changes. It would be the legal vehicle to do.
1:50:18 > 1:50:22It's difficult to answer the question domestic clear as to how we
1:50:22 > 1:50:28create a transitional period in terms of the relation with the EU,
1:50:28 > 1:50:34what the transitional period would look like in international terms.I
1:50:34 > 1:50:37would imagine the government is looking to the withdrawal
1:50:37 > 1:50:41implementation Bill, that would take care of that and it would be clear
1:50:41 > 1:50:47on what the nature of the transition is, the vehicle and the details
1:50:47 > 1:50:53prior to that coming to the house. The withdrawal bill repeals the
1:50:53 > 1:50:59community act, with the next one bring it back again?The next bill
1:50:59 > 1:51:05may provide the mechanism where we have new EU laws in the past
1:51:05 > 1:51:10transition. The means to do that, I do not know.By recreating some of
1:51:10 > 1:51:20the powers?In a separate bowl... It is a technical term! -- separate
1:51:20 > 1:51:28bill.I do want to come back in on this.We've had an interesting
1:51:28 > 1:51:31discussion about the implementation arrangement, the European Council
1:51:31 > 1:51:37made it pretty clear that the UK would continue to participate in the
1:51:37 > 1:51:41customs union and the single market during transition. I am puzzled as
1:51:41 > 1:51:50to why any, I am assuming you are clear on this and we should be too
1:51:50 > 1:51:54but what is clear is it shows the creativity of political solutions
1:51:54 > 1:52:02where there is a will because this is not using a model, this is
1:52:02 > 1:52:05something new. It should give us all hope for political creativity over
1:52:05 > 1:52:16the next phase of the relationship. Added to which I think you both said
1:52:16 > 1:52:22that there was no need for national ratification, the implementation
1:52:22 > 1:52:25phase, even though there could be legal challenges in theory which
1:52:25 > 1:52:29seems to be another good example of what I would call positive political
1:52:29 > 1:52:35compromise. I think your third word is "Fudge". What does this tell us
1:52:35 > 1:52:39about the degree of optimism that we all have for future positive
1:52:39 > 1:52:48political compromises that is more than just trade? Maybe we could
1:52:48 > 1:53:00start with Steven?I'm quite optimistic. The fact that the EU is
1:53:00 > 1:53:06extending the status quo, they are trying to engage in defining the
1:53:06 > 1:53:10future relationship that we will have and the starting point is one
1:53:10 > 1:53:14hand closely aligned with the single market, like Norway, the traditional
1:53:14 > 1:53:18free trade agreement of Canada, I do think that the reality is that it
1:53:18 > 1:53:22will be somewhere between. From the Ukippers starting position, it's
1:53:22 > 1:53:27closer to Canada and Norway that the noises that you had from member
1:53:27 > 1:53:32states illustrate that they are something bespoke. As I say, it will
1:53:32 > 1:53:38be bespoke by the very nature. We are talking about other fields of
1:53:38 > 1:53:42close cooperation. I think the UK does have a strong argument as to
1:53:42 > 1:53:47why we should have an ambitious trade agreement in the areas where
1:53:47 > 1:53:50we have traditionally been deficient. The areas of services,
1:53:50 > 1:53:54like the UK, they have a strong case. It's going to be difficult and
1:53:54 > 1:54:00it depends to a degree on the question of alignment, how the UK
1:54:00 > 1:54:08aligns itself with the EU laws. But the key thing is the mechanism where
1:54:08 > 1:54:11the UK says they want to do something differently. That will be
1:54:11 > 1:54:15the million-dollar question in terms of what the future relationship
1:54:15 > 1:54:21looks like.One thing we haven't touched on in detail, the agreement
1:54:21 > 1:54:29of around 300 external bodies, presumably that could be relatively
1:54:29 > 1:54:32simply regularised here in the implementation phase, where the EU
1:54:32 > 1:54:38simply notifies those bodies that as far as they are concerned, that
1:54:38 > 1:54:45agreement with the EU gaining implementation includes the UK.I
1:54:45 > 1:54:51think it depends, to a degree. The more technical it gets, when you are
1:54:51 > 1:54:54talking about actual trade agreements with third countries,
1:54:54 > 1:54:59those countries will have a view. The UK Government is busy using
1:54:59 > 1:55:01diplomatic channels with those countries to explain why it should
1:55:01 > 1:55:07be in their interest.I'm not interested in the FTA is as the
1:55:07 > 1:55:12government is sorting those, but where the EU is in dialogue during
1:55:12 > 1:55:19the two-year implementation phase, they could simply discuss with, led
1:55:19 > 1:55:25by and confirm that as far as they are concerned, they are happy for
1:55:25 > 1:55:29that arrangement to continue on the basis that as the European Council
1:55:29 > 1:55:36has said, everything in practice, or existing structures would actually
1:55:36 > 1:55:40apply.They could do, it's a political question as to whether
1:55:40 > 1:55:46they will.Thank you.I think as Leanne Wood get to have a say as
1:55:46 > 1:56:02well. The European Council -- every trade agreement is bespoke. How that
1:56:02 > 1:56:09bespoke deal is on a pre-existing templated, on those where you
1:56:09 > 1:56:16mentioned...Michel Barnier himself talked about a new and deep
1:56:16 > 1:56:18partnership, what is your interpretation on what that means in
1:56:18 > 1:56:24terms of a future agreement?My interpretation of what Michel
1:56:24 > 1:56:32Barnier means, is a new and deep partnership is the templates are
1:56:32 > 1:56:36slightly amended to meet the needs of the UK, which is why Michel
1:56:36 > 1:56:40Barnier's position is that there is Norway, Canada, and nothing much in
1:56:40 > 1:56:46between.He talks specifically about sectors included in the partnership
1:56:46 > 1:56:52of defence and security, so on. Is there a model for those?No, well,
1:56:52 > 1:56:55there are security arrangements between states. I'm not sure there's
1:56:55 > 1:56:59a model that will capture the full complexity and depth of what we are
1:56:59 > 1:57:03trying to do but remember, if you are dealing with security, some
1:57:03 > 1:57:07aspects of security, especially when it comes to criminal databases and
1:57:07 > 1:57:12the like, it will confront us with precisely the same trade-offs as the
1:57:12 > 1:57:15economic relationship as they are governed within the EU by the
1:57:15 > 1:57:22European Court of Justice. With security, there are similar
1:57:22 > 1:57:25trade-offs. When it comes to military affairs, things are easier
1:57:25 > 1:57:30because there is far less within the ambit of what we call the first
1:57:30 > 1:57:33pillar of EU law. Even in some aspects of security, we have to
1:57:33 > 1:57:39trade off. My point is, when you raise your question, initially, you
1:57:39 > 1:57:47talked about whether progress on the Article 50 deal makes you more
1:57:47 > 1:57:51positive about the potential for striking innovative new deals, not
1:57:51 > 1:57:56particularly. We have a treaty article that allows us to do
1:57:56 > 1:58:00transition under Article 50, we think. But the government seems to
1:58:00 > 1:58:08be wanting from the EU is something new. The government might, for
1:58:08 > 1:58:12instance, addressed the question of the Irish border using technology.
1:58:12 > 1:58:15To the best of my knowledge, nobody has managed to do that. It might
1:58:15 > 1:58:19come with a mechanism but I'm hesitant trusting things I don't
1:58:19 > 1:58:23know anything about. I've more faith in our ability getting something
1:58:23 > 1:58:29based on a template than something relatively new.During the
1:58:29 > 1:58:32implementation phase, it's completely new...Yes, but it is
1:58:32 > 1:58:38based...Could you participate without being in the EU or the EA
1:58:38 > 1:58:46ourselves?Yes, but it's based on an explicit treaty article.And during
1:58:46 > 1:58:53the implementation phase, he said words to the effect of can we get on
1:58:53 > 1:58:58with things that we want to do? The early implementation phase? The
1:58:58 > 1:59:03answer is no but in respect, wasn't the answer actually yes? The only
1:59:03 > 1:59:09implementation phase, we will be having those negotiations with third
1:59:09 > 1:59:18parties, and they secure what bodies outside of the EU are...What I was
1:59:18 > 1:59:22referring to them as our ability to change laws and bring in new
1:59:22 > 1:59:27policies domestically, if we think the template that the European
1:59:27 > 1:59:30Council has set out would be the template for transition we will not
1:59:30 > 1:59:33be able to do because we will still be bound by single market laws.
1:59:33 > 1:59:37Thank you.
1:59:37 > 1:59:42Would you like me to come in terms of time?I'm slightly worried by the
1:59:42 > 1:59:48numbers. There are one or two other colleagues who want to come in.Two
1:59:48 > 1:59:54brief on two separate issues. I don't really deal in terms of
1:59:54 > 1:59:57optimism or pessimism is ideal in terms of problems and solutions. One
1:59:57 > 2:00:02of the key factor that is going to influence how we find a solution to
2:00:02 > 2:00:04the problem of our future relationship with EU institutional
2:00:04 > 2:00:11structures. In a way, these are the key to ambitious and sophisticated
2:00:11 > 2:00:15trade agreements or security agreements. Any other field of
2:00:15 > 2:00:18international cooperation. It's very easy to make promises about the
2:00:18 > 2:00:23rules, scope of cooperation. What can create ambitious deep and
2:00:23 > 2:00:25special partnerships are the institutional structures. At the
2:00:25 > 2:00:29minute it's probably where we know the least in terms of the
2:00:29 > 2:00:34preferences of the UK and, indeed, EU. Until we have more clarity on
2:00:34 > 2:00:38what a deep and special partnership actually translate into any
2:00:38 > 2:00:43institutional governance turns about how willing we are to give up
2:00:43 > 2:00:46decision-making powers, share power with others, it's very difficult to
2:00:46 > 2:00:53know what it might look like. The working assumption of the lawyers I
2:00:53 > 2:00:57speak to, who are more specialist in the field than me, it requires a
2:00:57 > 2:00:59case-by-case analysis, there is no single solution for every
2:00:59 > 2:01:02international agreement will have its own text, define its own
2:01:02 > 2:01:06territory, said its own rules. It is a case-by-case working it through,
2:01:06 > 2:01:10finding a solution. Is there any precedent for any other
2:01:10 > 2:01:15country in the world looking for a deep partnership with the EU?Where
2:01:15 > 2:01:20all the laws are in complete alignment at the starting point of
2:01:20 > 2:01:23those discussions?It comes back to the governance and institutional
2:01:23 > 2:01:27issues. We can have lots of shared aspirations.That's not the answer
2:01:27 > 2:01:31to the question.Many countries in the world will say they share the
2:01:31 > 2:01:34same values, same aspirations, they want to achieve the same things. If
2:01:34 > 2:01:38you're not prepared to put in the institutional structures to deliver
2:01:38 > 2:01:42it, they are aspirations. Worthy aspirations but aspirations.What do
2:01:42 > 2:01:47you mean by institutional structures?A political body which
2:01:47 > 2:01:51will manage the agreement which will adopt any necessary legislation
2:01:51 > 2:01:55which will elaborate changes and provide for monitoring and
2:01:55 > 2:01:58enforcement. Administered bodies which will coordinate between the
2:01:58 > 2:02:02different sides and ensure they are dinging convergence or diversions.
2:02:02 > 2:02:07And most importantly a dispute settlement mechanism whether an
2:02:07 > 2:02:11independent tribunal from the two parties, whether borrowing tribunal
2:02:11 > 2:02:17from each party, not having any and relying on national courts. Those
2:02:17 > 2:02:21are the arrangement I'm talking about.You do in problems and
2:02:21 > 2:02:26solutions so what is your solution? This would be a matter of lengthy
2:02:26 > 2:02:30negotiation between the EU and EU. There are no solutions, their
2:02:30 > 2:02:37options. The solution will be for agreement between the sites.For
2:02:37 > 2:02:39information, while we've been meeting, the Commissioner has
2:02:39 > 2:02:44published draft guidelines on transition. It goes to the heart of
2:02:44 > 2:02:48Richard's first question. It says in line with the European Council
2:02:48 > 2:02:53guidelines of the 29th of April 2017 it is also recall that as from the
2:02:53 > 2:02:56date of its withdrawal from the union, the United Kingdom will no
2:02:56 > 2:03:00longer benefit from the agreement included by the union or by member
2:03:00 > 2:03:04states acting on its behalf, or by the union and its member states
2:03:04 > 2:03:08asking jointly. It goes on to say, however, where it is in the
2:03:08 > 2:03:12interests of the union, the union may consider whether and how can
2:03:12 > 2:03:15arrangement can be agreed that maintain the effects of the
2:03:15 > 2:03:18agreements as regards the United Kingdom during the transition
2:03:18 > 2:03:23period. The United Kingdom should, however, no longer participate in
2:03:23 > 2:03:29any body set up by those agreements. That has just been published. Two
2:03:29 > 2:03:33final quick points, firstly from Stephen Kinnock, then Stephen Timms,
2:03:33 > 2:03:36then we'll draw the session to close because you've been very generous
2:03:36 > 2:03:38with your time and with your answers, which have been very
2:03:38 > 2:03:44helpful.Thank you very much. Briefly I wanted to come back to
2:03:44 > 2:03:48this point about what we'll be happening during the transition
2:03:48 > 2:03:55period in terms of the negotiation of the future relationship. Not just
2:03:55 > 2:04:00the negotiation but the ratification. It is highly likely it
2:04:00 > 2:04:07will be a mixed agreement and, therefore would require... It would
2:04:07 > 2:04:14happen under the aegis of article 218 of the treaty. Which requires
2:04:14 > 2:04:18ratification by all of the national parliaments. Can you confirm if
2:04:18 > 2:04:25we're talking about the two year transition period, in those two
2:04:25 > 2:04:32years first of all the negotiations would have to be finalised between
2:04:32 > 2:04:38the UK and EU institutions in order to get the legal text agreed for the
2:04:38 > 2:04:44future relationship. And that future relationship would then, text would
2:04:44 > 2:04:52have to be ratified by 34 national and regional parliaments. Is that
2:04:52 > 2:05:01correct?That is the case.How realistic do you think it is to
2:05:01 > 2:05:06achieve that in the given time frame?I mean I probably should say
2:05:06 > 2:05:09upfront I'm working on the assumption for myself in my own work
2:05:09 > 2:05:15that the transitional agreement of two years will expire and
2:05:15 > 2:05:19effectively what it will have done is still a withdrawal under other
2:05:19 > 2:05:24terms. But will still be negotiating, in my view, still
2:05:24 > 2:05:28negotiating the final text of a future agreement that will still
2:05:28 > 2:05:31have to go through ratification processes. My working assumption is,
2:05:31 > 2:05:34I might be proven wrong by circumstances, who knows, my working
2:05:34 > 2:05:38as she nears the transitional agreement is basically postponing
2:05:38 > 2:05:41the full effects of withdrawal until we are better placed to cope with
2:05:41 > 2:05:45them. We'll have to cope eventually. I'm not working on the assumption
2:05:45 > 2:05:52it's realistic to think even after two years, post-withdrawal,
2:05:52 > 2:05:55formerly, while the transition period is going on, we will have
2:05:55 > 2:05:58secured the deep and special partnership as a final text, and
2:05:58 > 2:06:02that it will have gone through national ratifications.It would
2:06:02 > 2:06:06also be helpful, am I correct in saying, once the first of the stage
2:06:06 > 2:06:10as Stephen has referred to, the agreement on new trading
2:06:10 > 2:06:13relationship, is reached, there is provision for provisional
2:06:13 > 2:06:18application pending ratification. It's not bad you can't implement it
2:06:18 > 2:06:21until all of the 35 parliaments have agreed, can you confirm that as
2:06:21 > 2:06:26correct? That is the case.Yes. We also don't know what form this will
2:06:26 > 2:06:30take, there could be more than one agreement to be ratified, separate
2:06:30 > 2:06:35treaty on security, a separate agreement on trade. It's not a given
2:06:35 > 2:06:42that it's the mixed agreement. If we ended up with a more seater style
2:06:42 > 2:06:45agreement, that wasn't a mixed agreement, the member states decided
2:06:45 > 2:06:50to go down the route of ratification. The legal opinion of
2:06:50 > 2:06:54the institutions was that it was not a mixed agreement, it was a
2:06:54 > 2:06:58political decision taken to ratify. Which is always open. If people want
2:06:58 > 2:07:02to find a way around that there are ways in which that could be done.
2:07:02 > 2:07:08One of the methods might be to divide certain issues which...
2:07:08 > 2:07:12Issues of security that may have to be nationally ratified whereas other
2:07:12 > 2:07:15issues on trade it might be easier to do simply for agreement at
2:07:15 > 2:07:21Council.Stephen Timms, final question.I wondered if you could
2:07:21 > 2:07:28expand a little, Menon, I asked whether maintaining no
2:07:28 > 2:07:31infrastructure on the border would force us to stay in the customs
2:07:31 > 2:07:34union, you said if it did it would force us to stay in the single
2:07:34 > 2:07:39market as well. I'm not quite clear how membership or not of the single
2:07:39 > 2:07:42market affects the question of whether or not there is a hard
2:07:42 > 2:07:47border.You're aware of the discussion about chlorinated
2:07:47 > 2:07:52chicken. Membership of the single market implies accepting rules on
2:07:52 > 2:07:55health and safety standards and so on and so forth. You can't have a
2:07:55 > 2:07:59border of the single market without some mechanism of checking whether
2:07:59 > 2:08:04those standards are being adhered to with goods coming in. Even when it
2:08:04 > 2:08:08comes to the regulatory as opposed to tariff issues, there will have to
2:08:08 > 2:08:14be some provision for checking which will necessitate some physical
2:08:14 > 2:08:22infrastructure that goes against what is down in the agreement.Food
2:08:22 > 2:08:24health?It's probably but she function of customs checks, not to
2:08:24 > 2:08:29check the money and collected, probably but she function of customs
2:08:29 > 2:08:32checks is to ensure regulatory compliance with environmental
2:08:32 > 2:08:37standards, counterfeiting, money laundering and drug running. As well
2:08:37 > 2:08:43as issues of food safety and rules of origin. Customs checks perform a
2:08:43 > 2:08:46wide array of functions, it's not just about the tariffs and money,
2:08:46 > 2:08:51they are a lot about enforcing trade policy at your own border.I agree
2:08:51 > 2:08:57with that. Once you start thinking about this, it's the element of
2:08:57 > 2:09:00alignment with the single market that are probably the biggest issue
2:09:00 > 2:09:07to avoiding a visible border. Collecting tariffs can be done
2:09:07 > 2:09:10electronically. It's an issue about alignment. It probably can be
2:09:10 > 2:09:14narrowed down to specific elements of the single market. To answer the
2:09:14 > 2:09:18put several times, I don't think it necessarily requires wholesale
2:09:18 > 2:09:21membership of the single market if the EU is willing to be flexible
2:09:21 > 2:09:26which is the big question.Can I only half of the committee thank you
2:09:26 > 2:09:29for your very full and extremely helpful answers? We've covered a
2:09:29 > 2:09:34great deal of ground. We are grateful. Happy Christmas to all of