Where do UK-EU talks stand?
Both sides say some progress has been made in recent days.
"After difficult weeks with very, very slow progress, now we have seen in the last days better progress, more movement on important files," European Commission president Ursula von der Leyen said. "There are still quite some metres to the finish line so there is still a lot of work to do . . . Time pressure is high without any question."
The legal text of a deal between the UK and the European Union is said to be 95 per cent agreed, though with some text bracketed off in the areas of aviation, road haulage, rules of origin and energy that will only be finalised once the full text is complete.
The remaining 5 per cent is on the old stumbling blocks of fisheries, governance and the level playing field, on which both sides say there are serious differences.
What are the sticking points?
The most contentious is fishing, as the UK has not moved much from its initial position. It wants to grant access to EU fishing boats in annual negotiations based on “zonal attachment”, a method of calculating rights over fishing stocks based on the UK’s exclusive economic zone. This was established in the last decade, is the fifth-largest in the world, and could threaten to cut off EU fleets from areas in which they have traditionally fished. The EU wants multiannual access agreements and a more generous division of fishing rights.
On the level playing field, progress has been made towards agreement on state aid. A contentious area is that the EU wants to have the power to autonomously retaliate in any sector of trade if the UK deviates from shared standards on labour rights, environmental protections or taxation.
On governance, which refers to how future disputes could be arbitrated, the UK wants fisheries to be managed separately from arrangements covering the rest of the deal. It’s also possible that the deal could be reviewed in five or 10 years’ time. The EU believes any such review should cover the entire deal, while the UK wants to separate fisheries from this process.
When could a deal be reached?
Both sides had hoped there could be a breakthrough in the coming week, but the suspension of in-person talks because a senior EU negotiator tested positive for Covid-19 is expected to cause a delay.
Is time running out?
The UK side is more relaxed, but some EU member states fear time has already run out. After any deal is struck, it must be translated into EU languages, scrutinised by national capitals and MEPs, and approved by vote in the European Parliament.
The deal is likely to concern some issues that fall under the power of national governments, rather than just issues such as trade that have been delegated to the EU Commission. For this reason, it should technically need to be voted on by the parliaments of member states as well as the European Parliament for approval, a process prone to political upsets.
Member states could choose to waive this right, though this might be politically tricky and would require unanimity. They may discuss this next week. Due to the lack of time, the deal could also be provisionally applied, and the national votes held next year.
Could there be some kind of extension?
The end of the transition period is legally fixed on December 31st and will not change. Given that any deal will now come very late, member states could consider a gap of a few weeks between that point and the deal’s full ratification to be an implementation period. However, this has not yet been discussed.
What comes next?
The EU side believes a decision is required by UK prime minister Boris Johnson to move to a compromise on the contentious 5 per cent of the deal in order to forge agreement. They have also said that a deal would not be possible if the British government passes the controversial clauses of the Internal Markets Bill, which unpick aspects of the withdrawal agreement signed last year designed to avoid a border in Ireland and is currently going through the UK parliament. In addition, they say the Northern Ireland protocol, which requires checks at Irish Sea entries into the North, must be fully implemented. The British side say that movement is needed by both sides. "We now need to see more realism from the EU on what it means for the UK to be an independent state," a UK government spokeswoman said.
