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Lords EU Committee report analyses the EU negotiating positions on future relationship


The House of Lords EU Committee today reports on the EU negotiating positions on the future relationship, analysing it in the light of the Political Declaration and the announced UK positions. A debate will follow in the House of Lords within 14 business days under the new procedure established in the EU (Withdrawal Agreement) Act 2020.

The Committee's report focuses on the EU negotiating directives, concluding that they ‘raise matters of vital national importance'. It also highlights the divergence of both sides' positions since they agreed the political declaration on future UK-EU relations in October 2019, and the challenge of reaching agreement by the end of 2020.
 
According to the provisions of section 29 of the EU (Withdrawal Agreement) Act, the report must be debated in the House within 14 sittings days. The process was established in the Act to ensure Parliament continued to have a role in scrutinising and debating EU legislation during the transition period, while it continues to apply in the UK. This is the first time this mechanism has been used in either House.
 
The Committee expresses regret that the United Kingdom Parliament has not been given an opportunity to play its proper role in debating, in Government time, issues of such vital national interest as the two sides' declared positions on the future relationship. It contrasts this with the detailed consideration by the European Parliament of the EU's negotiating position.
By reporting now the Committee will ensure that an informed debate takes place in the House of Lords before the Easter recess.
 
Commenting on the report, Lord Kinnoull, Chair of the House of Lords EU Committee, said:
 
“We regret that the Government has not yet scheduled formal debates in either House on the way the UK and the EU are approaching negotiations on the future relationship. The UK Parliament has a role to play in scrutinising these negotiations and should not be side-lined.
 
“The new mechanism contained in the EU (Withdrawal Agreement) Act requires a debate on our report within 14 sittings days. The report itself is neutral and factual, aiming to ensure that the House of Lords can hold an informed debate.
 
“What our analysis shows is just how far the UK and EU sides have grown apart since they agreed on the framework for future relations last October. That may be because they are both setting out their stall for the negotiations. But the clock is ticking, and the two sides only have until the end of the year to reach an agreement. It will be a huge challenge.”
 
The Committee highlight a number of areas where the EU and UK Government's stated negotiating positions differ from those set out in last year's political declaration. These include:

  • The ‘level playing field' – The Committee identifies a number of areas in which the EU has set ‘level playing field' requirements, beyond what was agreed last October. It notes that in most areas there is nevertheless the potential for the two sides to reach agreement on mutual “non-regression” (for instance on labour or environmental standards).
  • State Aid – This element of the EU's ‘level playing field' demand appears to be a key sticking point. The Committee point out that the EU's Decision demands continuing UK alignment with EU State aid rules, but the UK Government insists it will have its own regime of subsidy control. The report says the two positions are “incompatible” and that both sides' positions have hardened in recent weeks.
  • Financial services – The Committee point out that it will be difficult to reconcile the UK Government's desire for a durable equivalence regime for financial services with European Commission's insistence of the right of both parties to take unilateral decisions in their own interests.
  • Fisheries – The report makes clear that the Political Declaration's aspiration for a ‘new fisheries agreement' to be reached by the end of June will be extremely challenging. The EU's Decision states that the EU will look to ‘uphold' existing reciprocal access and quota shares, while the UK Government's position is to end the ‘relative stability mechanism' on which current quotas are based.

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