Priorities for a New EU-UK Economic Partnership
As the Brexit negotiations continue, the business community is eager to ensure that economic disruptions are minimized. Millions of jobs on both sides of the Channel rely directly on EU-UK trade and investment flows. Both economies would be hit hard by a “cliff edge” scenario, with an immediate return to WTO tariffs and regulatory uncertainty governing cross-border trade in goods and services.
The U.S.-UK Business Council represents companies with large investments—directly responsible for hundreds of thousands of jobs—in both Britain and the EU. Our members have a significant stake in the outcome of these negotiations, and we aim to provide information that will help negotiators minimize the adverse effects of the reset in UK-EU relations. This includes forging a close economic partnership between the EU and UK implemented following a suitable transition period.
Understandably, the terms of an orderly UK withdrawal must be finalized first. Employers, workers, and governments must agree on a fair and equitable system to protect citizens’ rights to work and migrate after Brexit occurs. A fair financial settlement must be calculated, and the critical issue of the border between Ireland and Northern Ireland must be resolved to minimize friction in commerce and travel across the island of Ireland.
Once sufficient progress has been made on these issues, attention must turn quickly to the contours of the future relationship. This will be essential to minimize uncertainty for workers, employers, consumers, and citizens alike. In this context, we are pleased that the UK government released position papers on several important issues, and we are similarly encouraged by the proactive approach of the European Commission to negotiate a deal that works for all of Europe, pursuant to the European Council’s negotiating guidelines.
We have identified several key issues that must be addressed in the context of a future EU-UK economic partnership agreement. These include: market access for goods; customs and trade facilitation; data protection and data transfers; financial services; intellectual property rights protection; movement of labor; and regulatory cooperation.
In each of these areas, we have crafted short policy briefs that articulate the real world challenges businesses face, and suggest creative solutions.
- Market Access for Goods: Tariffs and Non-Tariff Barriers & Customs Procedures, Rules of Origin, and Trade Facilitation: The EU and UK should endeavor to negotiate a broad zero-tariff trade agreement and a seamless customs regime that reduces unnecessary administrative burdens and limits delays at the border, setting a global standard in trade facilitation.
- Data Protection and Data Transfers: The UK must ensure it remains compliant with EU laws, including achieving adequacy status under the General Data Protection Regulation to allow data to continue to flow freely.
- Financial Services: A comprehensive transitional arrangement will be vital to ensure companies’ ability to continue to seamlessly service their customers. The two sides should endeavor to maintain full regulatory equivalence via an ongoing financial services regulatory dialogue.
- Intellectual Property Rights: We encourage the UK to remain in the Unified Patent Court and to provide an orderly transition to convert EU Trademarks and Community Designs Rights into UK registrations.
- Movement of Labor: EEA nationals in the UK (and British nationals in Europe) should retain their current rights. New flexible procedures should be crafted to ensure the continued ability for seasonal workers, intra-company transfers, and skilled workers to move across Europe with minimal impediments.
- Regulatory Cooperation: The UK and EU are starting from a point of full regulatory convergence, but maintaining equivalent regulatory outcomes in the years ahead will require effective mechanisms for joint consultations and review, as well as a commitment to seek common approaches to new issues.
The private sector has ambitious expectations for the future EU-UK economic partnership. The U.S.-UK Business Council stands ready to help negotiators understand the practical issues at stake, and to achieve solutions that safeguard prosperity and growth across Europe.