03 Oct

ABCC Brexit Update – PM Johnson Sets Out His Brexit Proposals to EU – 3 October 2019

  • PM Boris Johnson set out his proposals for a Brexit Withdrawal Deal at the Conservative Party Conference in Manchester on 2 October.  The proposals are expected to be presented to the UK Parliament on 3 October.
  • The plans, which seek to break the current stalemate over the Northern Irish Backstop, have now formally been sent to European Commission President Jean-Claude Juncker ahead of the 17/18 October EU Council meeting of EU leaders.  Johnson now hopes to enter intense or ‘tunnel negotiations’ with the EU ahead of the 17th October to negotiate the details of a deal.
  • The 17/18 October meeting will be the last opportunity for Johnson to secure a withdrawal deal with the EU before the ‘Benn Act’ comes into effect on 19 October.  In the absence of withdrawal deal with the EU and in order to avoid a ‘Hard Brexit’ on 31 October, the act legally requires PM Johnson to request a further Brexit extension from the EU from 31 October to 31 January 2020 – something which PM Johnson has repeatedly pledged not to do.
  • The four page letter from Johnson to Juncker, entitled a ‘Fair and Reasonable Compromise: UK Proposals for a New Protocol on Ireland/Northern Ireland’ was accompanied by a seven page explanatory note.
  • Under the ‘two borders for four years’ plan, Northern Ireland would remain in a special relationship with the European Union until 2025.  The BBC summarises Johnson’s proposals, which he calls a “broad landing zone” for a new deal with the EU as follows:
    • Northern Ireland would leave the EU’s customs union alongside the rest of the United Kingdom, at the start of 2021.
    • However, Northern Ireland would, with the consent of politicians in the Northern Ireland Assembly, continue to apply EU legislation relating to agricultural and other products – what Johnson calls an ‘all-island regulatory zone’.
    • Customs checks on goods traded across the Northern Irish/Republic Ireland border would be ‘decentralised’, with paperwork submitted electronically and only a ‘very small number’ of physical checks.
    • These checks should take place away from the Northern Irish/Republic of Ireland border itself, at business premises or at ‘other points in the supply chain’.
    • Agricultural and other products would face checks between Great Britain and Northern Ireland for this time period.  
    • The arrangement could, in theory, continue indefinitely, but the consent of Northern Irish politicians would have to be sought every four years.
    • The UK government has also promised a ‘New Deal for Northern Ireland” with financial commitments to fund the new regime.
  • Following his party’s annual conference, Johnson spoke with EU leaders including German Chancellor Angela Merkel, Irish Taoiseach Leo Varadkar and EU Council President Juncker.  Juncker and Merkel expressed their willingness to examine the proposals whilst Varadkar said they did not ‘fully meet the agreed objectives of the backstop’.
  • Importantly for Johnson, the Northern Irish Democratic Unionist Party (DUP) after previously opposing the contentious Northern Irish Backstop in PM May’s Withdrawal Deal, backed Johnson’s plans.  Initial reports suggest that Conservative rebels, hardline Brexiteers and a number of Labour MPs could back Johnson’s proposals if they are agreeable to the DUP.
  • PM Johnson also announced that he would prorogue (suspend) Parliament next Tuesday 8 October ahead of a Queen’s Speech on 14 October, when the Government will set out its new legislative agenda.  Unlike the recent prorogation which was ruled unlawful by the Supreme Court, a short suspension between parliamentary sessions is commonplace. 

The ABCC and Brexit

The ABCC will continue to follow these developments closely. We look forward to keeping members up to date with the very latest from London and what it possibly means for the Australian-British business community.  Earlier ABCC Brexit updates can be found on the ABCC Blog.

If you would like to receive more frequent Brexit updates or have any questions, please feel free to contact our office on abcc@britishchamber.com.

By Paul O'Hagan, General Manager, Victoria, South Australia & Western Australia

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