The UK’s exit from the EU
At 23:00 GMT on Friday 31 January, 2020, the United Kingdom (UK) officially withdrew as a member of the European Union (EU). The Brexit withdrawal saga came to an end, but not the process of re-establishing national trade governance in the UK and concluding a new trade agreement with the EU, the UK’s most important trading partner. The Withdrawal Agreement provides for a transitional period until 31 December 2020 to hammer out this arrangement.
Beginning on 1 January 2021, the UK lost all the rights and obligations it had as an EU Member State and during the transition period under the Withdrawal Agreement. It will no longer benefit from seamless access to the EU Single Market and Customs Union, or from EU policies and international agreements (including its free trade agreements with other third countries). The UK can now, however, conclude trade agreements with third parties such as the US and China. It will also return to the WTO as a member in its own right.
The UK voted to leave the European Union in the 23 June 2016 EU Referendum. Article 50 of the Treaty establishing the European Union (TEU) was triggered by the government on 29 March 2017, which began the formal process for the UK to leave the EU on 29 March 2019. The Withdrawal Agreement establishes the terms of the UK’s withdrawal from the EU. It ensures that the withdrawal will happen in an orderly manner, and offers legal certainty once the Treaties and EU law will cease to apply to the UK.
A political declaration setting out the framework for the future relationship between the EU and the UK was published on 12 November 2019, along with the official text of the Withdrawal Agreement.
Timeline of events
On 8 December 2017, high-level negotiators from the UK and Northern Ireland reached an with the EU to keep the Brexit negotiations on track. The EU has insisted that negotiations about future UK-EU trade could only start once an agreement about the Irish border, the payment of the UK’s divorce bill, and the position of EU citizens in the UK has been reached. This was achieved with the publication of Joint Report on Progress during Phase 1 of Negotiations under Article 50 TEU on the United Kingdom’s orderly Withdrawal from the European Union.
EU-UK Trade and Cooperation Agreement
On 3 February 2020, the European Commission issued a recommendation to the Council to open negotiations on a new partnership with the United Kingdom. This recommendation is based on the existing European Council guidelines and conclusions, as well as on the Political Declaration agreed between the EU and the United Kingdom in October 2019.
The EU-UK Trade and Cooperation Agreement will cover the following areas: trade in goods and in services, digital trade, intellectual property, public procurement, aviation and road transport, energy, fisheries, social security coordination, law enforcement and judicial cooperation in criminal matters, thematic cooperation and participation in Union programmes. It is underpinned by provisions ensuring a level playing field and respect for fundamental rights. The Agreement will confer rights and obligations on both the EU and the UK, in full respect of their sovereignty and regulatory autonomy. It will be governed by an institutional framework on the operation and enforcement of the Agreement, as well as binding dispute settlement and enforcement mechanisms.
Economic Partnership Agreements
An Economic Partnership Agreement (EPA) between the EU and the Southern African Development Community (SADC) EPA Group provisionally entered into force on 10 October 2016. The UK is part of the EU and trades with the SADC EPA States under the SADC-EU EPA. On completion of UK’s withdrawal from the EU, the UK will not be part of the EPA. To avoid trade disruption, SACU, Mozambique and the UK have decided to roll-over the EPA into a standalone trade agreement. The consolidated text has been drafted with most provisions agreed. Legal scrubbing has also been undertaken on the areas of the legal text that have been agreed.
The United Kingdom has committed to continue its current trade arrangements with the Eastern and Southern Africa (ESA) States if it leaves the European Union without a deal on 29 March 2019, or at the end of an implementation period. The ESA-UK Economic Partnership Agreement (EPA) will provide immediate duty-free quota-free access to goods from ESA States into the UK in exchange for more gradual tariff liberalisation from the ESA States.