How the ‘Windsor Framework’ changes Northern Ireland’s trade agreements

After months of secret negotiations, the UK and the EU on Monday published the text of their new deal to perfect post-Brexit deals for Northern Ireland.

Totaling to more than 100 pages, the agreement, called the Windsor Framework, sets out ways to soften the operation of the so-called Northern Ireland Protocol, which has soured relations between the EU and the United Kingdom and destabilized the politics of the region.

Although Northern Ireland continues to follow EU rules for trade in goods, the new implementation agreement sets out processes on trade policy, state subsidy and value added tax to reduce the impact of the Irish Sea trade border created by the original agreement.

While Northern Ireland remains subject to EU law in areas where it applies in the region, the deal takes steps to address concerns from the mainly Protestant unionist community that the protocol has undermined the Kingdom’s constitutional integrity. United.

The new framework aims to improve how the protocol works in five key areas:

The business of trading: red-green lanes

Goods from Great Britain to Northern Ireland will now be divided into two classes: those bound for Northern Ireland (green lane) and those bound for Ireland and the EU single market (red lane).

Businesses that sign up to a trusted trader scheme and use the green lane will see “an unprecedented reduction” in customs paperwork, the EU said. Goods in the red lane must pass full customs, food and animal health controls.

For agri-food products, the most strictly controlled products, the EU will accept the UK’s public health standards, which means fresh meat and other products will be allowed into Northern Ireland. They must bear “not for EU” labels.

As the labels are introduced between now and 2025, the proportion of shipments subject to identity checks will drop to 5%. The UK has agreed to share customs data in near real time with the EU so that it can detect evidence of fraud and take corrective action if necessary.

UK Prime Minister Rishi Sunak said the changes “removed any sense of border in the Irish Sea”, while an EU official spoke of a “drastic reduction in the number of checks”.

Parcels to friends or family and online deliveries from Great Britain will not require customs formalities, ending another major source of hassle for Northern Ireland residents. Companies using approved parcel delivery companies will have simplified customs procedures.

Importers of some types of British-made steel in Northern Ireland have had to pay tariffs since last year, when the EU changed its quota rules. The agreement also fixes this problem specifically for steel.

State aid and VAT

Under Article 10 of the protocol, any UK subsidy decision that could affect Northern Ireland’s trade in goods must be referred to Brussels for approval. The United Kingdom saw this as an unnecessary interference in its sovereignty.

Although Article 10 remains in force, the UK government said “stringent tests” would now apply, effectively removing 98 per cent of Northern Ireland’s subsidies from the risk of diversion to Brussels. “This rules out all but the largest subsidies and those where the companies have no material presence in Northern Ireland,” the UK said.

Another area of ​​difference that irritated British ministers was that Northern Ireland could not adopt changes to the national VAT rate, something Sunak said was unacceptable when he was chancellor.

These will now extend to Northern Ireland, including politically talismanic items: some cuts to alcohol taxes will now apply across the UK, including relief from beer in pubs.

However, with the exception of immovable objects such as household solar panels, the UK cannot lower the minimum EU VAT rates for now. The two parties agreed to draw up a list of goods on which the UK could impose lower rates over the next five years.

For the unionist community in Northern Ireland, the prospect of the region having to automatically implement large amounts of new or updated EU law in the future, as specified in the protocol, has long been a source of tension.

The deal seeks to address this by delivering an “emergency brake” to the Northern Ireland legislature in Stormont which can be withdrawn in “exceptional circumstances” if 30 out of 90 members from at least two parties vote to block adoption of the single update. of the EU. market rules

Under this ‘Stormont brake’, rules that are subject to objections will not apply until they have been discussed by Brussels and London. If Britain decides not to implement measures that the EU still considers necessary at the behest of the Northern Ireland assembly, the bloc could take specific “corrective measures”.

London has said it will legislate to ensure the Westminster government will heed Stormont’s demands as long as it pulls the emergency brake.

Experts said the circumstances in which it could be used were very strict. “This is progress, but the new system only applies when the brake is pulled,” said Catherine Barnard, a professor of EU law at the University of Cambridge. “For the rest of the time it’s business as usual.”

Feel part of the Union

EU rules had created a series of bureaucratic obstacles that unionists believed separated them from the rest of their country.

Pets had to be microchipped and obtain a passport to travel from Britain to Northern Ireland, the same rules needed to travel to the EU. Under the agreement, pets will only need a simple travel document.

Drugs approved for use in the UK could also be sold in the region even if they are not yet approved in the EU.

Finally, seed potatoes and plants that are prohibited from importation because they can carry diseases are now free to move into Northern Ireland on the basis of a special phytosanitary label.

The constitutional dimension: the role of the CJEU

Brexiter leaders and unionists have demanded an end to the jurisdiction of the Court of Justice of the European Union over Northern Ireland and the role of the CJEU as executor of the protocol.

The agreement does not achieve this; nor does it create a new dispute resolution mechanism involving international arbitration, as some Brexiter leaders wanted.

The UK government argued that the new “green lane” trading system significantly reduced the amount of EU law that applied in Northern Ireland, meaning 1,700 pages of EU law that applied in the deal original will no longer be applied in the region.

The government added that only 3 per cent of EU laws now apply in Northern Ireland. According to the command document: “The rules that apply are there solely, and only to the extent strictly necessary, to maintain the unique ability of Northern Ireland companies to sell their products on the EU market.”

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