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Home > Brexit deal: the Withdrawal Agreement

Brexit deal: the Withdrawal Agreement [1]

The UK and the EU agreed a draft agreement on the UK's withdrawal from the EU on 17 October 2019. It was ratified and entered into force on 31 January 2020. The table below sets out what is included and shows there are no significant differences from ’s deal. There is also an extensive protocol on Northern [2], which we explain separately.

Parliament has passed the Withdrawal Agreement Act [3], which implements this agreement in UK law.

Area

Implementation of the Withdrawal Agreement

Article 4 says that both the agreement and any EU law applying to the UK under the agreement should have the same effect as it has in EU member states.

This includes “direct effect”, which allows private parties to invoke their rights under the What withdrawal agreement before both UK courts, as well as EU member states. does it say? It also gives EU law supremacy over domestic law – the courts could disapply any domestic legislation which is incompatible with EU law.

In the March draft, this only applied to citizens’ rights. It would now apply to the entire agreement.

This will be challenging both politically and legally to implement, principally down to the role of parliamentary sovereignty in the UK. What does it The government of the time managed to give supremacy to EU law under the European mean? Communities Act 1972 [4], but this will be a challenge for the current government when they bring forward the EU Withdrawal Agreement Bill needed to implement the agreement in domestic law.

What has changed from Nothing has changed Theresa May's deal?

Transition

The UK will continue to apply the entire body of EU law during the transition, but it will be outside of the EU's political institutions.

The UK will continue to apply EU trade policy and any trade agreements signed by the UK will not be able to enter into force until the transition ends. The EU will write to third countries with which it has agreements to request the UK continues to benefit from these

1 What during the period. does it In addition to the continuation of the UK’s economic relationship with the EU, all elements of say? justice, home affairs, foreign and defence policies will continue. If agreement is reached on the future relationship in foreign, defence and security policy, this can come into effect before the end of the transition period and EU law will no longer apply in this area in the UK.

The transition period will end on 31 December 2020. Under the Withdrawal Agreement, the two sides could have extended the transition if they decided to do so by 1 July 2020. But the UK and the EU did not agree to do so by the deadline.

During transition, the UK would continue to be subject to all EU rules but also enjoy all rights of a member state except involvement in EU institutions. What does it Extension would allow the UK to avoid activating the Irish protocol in January 2021. mean? The UK and EU would need to agree the UK’s financial contribution for the extension if they decide to extend the transition.

What has changed from Nothing has changed Theresa May's deal?

Institutional provisions

A joint committee will oversee the agreement, composed of representatives from – and co- chaired by – the EU and the UK. It will meet at least once a year or at the request of one of What the two parties. does it It will be able to adopt decisions amending certain parts of the Withdrawal Agreement. These say? decisions will be binding and the EU and the UK will need to implement them.

Specialised committees will be established on each of the key separation issues.

What This gives the UK and the EU an equal role in overseeing the application of the agreement. It does it is not clear who will represent them in the joint committee or how often it will need to meet. mean?

What has changed from Nothing has changed Theresa May's deal?

Dispute settlement

The UK and EU will first try to resolve disputes via the joint committee where they will try to agree a solution.

If the committee cannot agree, then either the EU or the UK can request an arbitration panel. The EU and the UK will each nominate two members to the panel and agree a chair. If a What party does not comply with a ruling, then it can impose a financial penalty. Moreover, parts does it of the agreement could also be suspended (except the part relating to citizens’ rights), say? although this should be temporary. 2 If a dispute relates to the interpretation of EU law, or whether the UK has complied with European Court of Justice (ECJ) judgements made before the end of transition, then the ECJ will have jurisdiction. This ruling will be binding on the arbitration panel.

The agreement has settled on a political resolution, then arbitration process rather than the establishment of a court (and this will form the basis of the dispute resolution process for the What future framework). does it mean? The proposed role for the European Court of Justice (ECJ) in the withdrawal agreement reflects the ECJ’s position [5] that only the ECJ can bind certain interpretations of EU law and concepts.

What has changed from Nothing has changed Theresa May's deal?

Geographical indications

More than 3,000 geographical indications, such as Parma ham, Champagne and Welsh lamb, What are currently protected under EU law. does it say? The agreement guarantees that they will continue to be protected, with the UK agreeing to apply the same level of protection through its domestic law as the EU provides now.

Geographical indications are names used to define both the origin and the quality, characteristics or reputation of products. It often applies to food and drink.

What The UK will have to set up its own list of geographical indications in domestic legislation that does it will recognise the EU’s. mean? This applies "unless and until" superceded by the long-term trading relationship – recognising geographical indications are usually a key demand of the EU in trade agreements.

What has changed from Nothing has changed Theresa May's deal?

Gibraltar

Spain and the UK have agreed a bilateral protocol on citizens’ rights, particularly frontier workers; air transport; fiscal and financial matters; environment protection and fishing; and police and customs co-ordination. What does it Spain and the UK will co-ordinate bilaterally, while the EU Commission will be invited to participate in police and customs matters. EU air transport law will be updated during the say? transition period if both Spain and the UK agree.

These provisions, except those on citizens’ rights, cease to apply by the end of the transition period.

3 What The UK and Spain are both responsible for ensuring that citizens’ rights established by the does it Withdrawal Agreement are protected. mean? EU aviation law, which doesn't apply now to International Airport, can only be applied during the transition if both the UK and Spain agree.

What has changed from Nothing has changed Theresa May's deal?

Cyprus

The Protocol on the Sovereign Base Areas in Cyprus aims to preserve the current, unique situation. The Sovereign Base Areas will remain part of the Union’s custom territory and be bound by EU law with respect to indirect taxation, regulation of agriculture, goods and data. What The UK will continue to pass domestic legislation but will entrust responsibility to the does it Republic of Cyprus for implementation and enforcement, responsible to the EU. say? A specialised committee will facilitate the Protocol’s implementation, and the joint committee will amend references to EU law upon its recommendation. The ECJ will supervise and have jurisdiction.

The Sovereign Base Areas will be considered part of the EU’s customs territory, align with What agricultural standards and the Republic of Cyprus’ VAT and excise regime after the transition does it period. mean? The Republic of Cyprus will have responsibility for implementation and enforcement in most areas covered, those most important to the EU, but not security and defence.

What has changed from Nothing has changed Theresa May's deal?

Citizens’ rights

Protects the rights of UK citizens living in the EU and EU citizens living in the UK, as well as their family members, to continue to live and work there (unless they leave for longer than five years). This applies to citizens who move to the UK or the EU during the transition period.

What They may need to apply for a residence status, in accordance with each country’s law. EU does it citizens in UK do need to apply through the EU Settlement Scheme. say? These citizens will be able to apply for permanent residence (called ‘settled status’ in the UK) if they have been living in that country for five years continuously.

This will be overseen by Monitoring Authority in the UK, which will report to the institutions overseeing the Withdrawal Agreement. The will monitor compliance in member states.

UK and EU citizens will continue to be able to live and work in the EU and UK respectively – What unless they leave for over five years. 4 does it In the UK, EU citizens will need to apply for ‘settled status’ to ensure they can access these mean? rights. The UK government will need to establish a new body to oversee the application of the agreement and ensure EU citizens’ rights in the UK continue to be protected.

What has changed from Nothing has changed Theresa May's deal?

Financial settlement

What The UK will honour the financial commitments it made as a member state. This includes its does it contribution to the EU budget, where it will receive its rebate. say? UK beneficiaries of EU programmes will continue to participate until they end.

What As a member state, the UK agreed the previous multiannual financial framework and to pay does it for certain EU programmes – the UK has agreed to continue to make these payments. mean?

What has changed from Nothing has changed Theresa May's deal?

What has changed Area What does it say? What does it mean? from Theresa May's deal?

Article 4 says that both the agreement and any EU law applying to the UK under the agreement should have the same effect as it has in This will be challenging both EU member states. politically and legally to This includes “direct effect”, implement, principally down which allows private parties to the role of parliamentary to invoke their rights under sovereignty in the UK. the withdrawal agreement The government of the time Implementation before both UK courts, as of the managed to give supremacy well as EU member states. Nothing has changed Withdrawal to EU law under the European Agreement It also gives EU law Communities Act 1972 [4], but supremacy over domestic this will be a challenge for the law – the courts could current government when disapply any domestic they bring forward the EU legislation which is Withdrawal Agreement Bill incompatible with EU law. needed to implement the agreement in domestic law. In the March draft, this only 5 applied to citizens’ rights. It would now apply to the What has changed Area Wenhtiraet a dgroeems eint t.say? What does it mean? from Theresa May's deal?

The UK will continue to apply the entire body of EU law during the transition, but it will be outside of the EU's political institutions.

The UK will continue to apply EU trade policy and any trade agreements signed by the UK will not be able to enter into force until the transition ends. The EU will write to third countries with which it has agreements to request the During transition, the UK UK continues to benefit would continue to be subject from these during the to all EU rules but also enjoy period. all rights of a member state In addition to the except involvement in EU continuation of the UK’s institutions. economic relationship with Extension would allow the UK Transition the EU, all elements of Nothing has changed to avoid activating the Irish justice, home affairs, foreign protocol in January 2021. and defence policies will continue. If agreement is The UK and EU would need to reached on the future agree the UK’s financial relationship in foreign, contribution for the extension defence and security policy, if they decide to extend the this can come into effect transition. before the end of the transition period and EU law will no longer apply in this area in the UK.

The transition period will end on 31 December 2020. Under the Withdrawal Agreement, the two sides could have extended the transition if they decided to do so by 1 July 2020. But the UK and the EU did not agree to do so by the deadline.

A joint committee will oversee the agreement, composed of representatives from – and co-chaired by – the EU and the UK. It will meet at least once a year or at the request of one of the two This gives the UK and the EU parties. an equal role in overseeing the application of the Institutional It will be able to adopt agreement. It is not clear who Nothing has changed provisions decisions amending certain will represent them in the parts of the Withdrawal joint committee or how often Agreement. These decisions it will need to meet. will be binding and the EU and the UK will need to

6 implement them. What has changed Specialised committees will Area Wbeh eastta bdliosheesd iotn s eaaych? of What does it mean? from Theresa the key separation issues. May's deal?

The UK and EU will first try to resolve disputes via the joint committee where they will try to agree a solution.

If the committee cannot agree, then either the EU or the UK can request an arbitration panel. The EU The agreement has settled on and the UK will each a political resolution, then nominate two members to arbitration process rather the panel and agree a chair. than the establishment of a If a party does not comply court (and this will form the with a ruling, then it can basis of the dispute resolution impose a financial penalty. process for the future Moreover, parts of the framework). Dispute agreement could also be Nothing has changed settlement suspended (except the part The proposed role for the relating to citizens’ rights), European Court of Justice although this should be (ECJ) in the withdrawal temporary. agreement reflects the ECJ’s position [5] that only the ECJ If a dispute relates to the can bind certain interpretation of EU law, or interpretations of EU law and whether the UK has concepts. complied with European Court of Justice (ECJ) judgements made before the end of transition, then the ECJ will have jurisdiction. This ruling will be binding on the arbitration panel.

Geographical indications are names used to define both the origin and the quality, More than 3,000 characteristics or reputation geographical indications, of products. It often applies to such as Parma ham, food and drink. Champagne and Welsh lamb, are currently The UK will have to set up its protected under EU law. own list of geographical Geographical indications in domestic Nothing has changed indications The agreement guarantees legislation that will recognise that they will continue to be the EU’s. protected, with the UK agreeing to apply the same This applies "unless and until" level of protection through superceded by the long-term its domestic law as the EU trading relationship – provides now. recognising geographical indications are usually a key demand of the EU in trade agreements.

Spain and the UK have agreed a bilateral protocol on citizens’ rights, particularly frontier workers; 7 air transport; fiscal and financial matters; What has changed The UK and Spain are both Area Wenhviarotn mdoenets p riott escatyio?n and What does it mean? from Theresa fishing; and police and responsible for ensuring that customs co-ordination. citizens’ rights established by May's deal? the Withdrawal Agreement Spain and the UK will co- are protected. ordinate bilaterally, while Gibraltar the EU Commission will be EU aviation law, which doesn't Nothing has changed invited to participate in apply now to Gibraltar police and customs matters. International Airport, can only EU air transport law will be be applied during the updated during the transition if both the UK and transition period if both Spain agree. Spain and the UK agree.

These provisions, except those on citizens’ rights, cease to apply by the end of the transition period.

The Protocol on the Sovereign Base Areas in Cyprus aims to preserve the current, unique situation. The Sovereign Base Areas will remain part of the Union’s custom territory The Sovereign Base Areas will and be bound by EU law be considered part of the EU’s with respect to indirect customs territory, align with taxation, regulation of agricultural standards and the agriculture, goods and data. Republic of Cyprus’ VAT and The UK will continue to pass excise regime after the domestic legislation but will transition period. Cyprus entrust responsibility to the Nothing has changed Republic of Cyprus for The Republic of Cyprus will implementation and have responsibility for enforcement, responsible to implementation and the EU. enforcement in most areas covered, those most A specialised committee will important to the EU, but not facilitate the Protocol’s security and defence. implementation, and the joint committee will amend references to EU law upon its recommendation. The ECJ will supervise and have jurisdiction.

Protects the rights of UK citizens living in the EU and EU citizens living in the UK, as well as their family members, to continue to live and work there (unless they leave for longer than five years). This applies to citizens who move to the UK or the EU during the transition period. UK and EU citizens will continue to be able to live and They may need to apply for work in the EU and UK a residence status, in respectively – unless they accordance with each leave for over five years. country’s law. EU citizens in UK do need to apply In the UK, EU citizens will 8 through the EU Settlement need to apply for ‘settled Citizens’ rights Nothing has changed Scheme. status’ to ensure they can What has changed access these rights. Area WThhesaet c ditiozeenss iwti lsl baey a?ble What does it mean? from Theresa to apply for permanent The UK government will need May's deal? residence (called ‘settled to establish a new body to status’ in the UK) if they oversee the application of the have been living in that agreement and ensure EU country for five years citizens’ rights in the UK continuously. continue to be protected.

This will be overseen by the Independent Monitoring Authority in the UK, which will report to the institutions overseeing the Withdrawal Agreement. The European Commission will monitor compliance in member states.

The UK will honour the financial commitments it made as a member state. As a member state, the UK This includes its agreed the previous contribution to the EU multiannual financial Financial budget, where it will receive framework and to pay for Nothing has changed settlement its rebate. certain EU programmes – the UK has agreed to continue to UK beneficiaries of EU make these payments. programmes will continue to participate until they end.

Update date: Thursday, July 2, 2020

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Links [1] https://www.instituteforgovernment.org.uk/explainers/brexit-deal-withdrawal-agreement [2] https://www.instituteforgovernment.org.uk/explainers/brexit-deal-northern-ireland-protocol [3] https://www.instituteforgovernment.org.uk/explainers/withdrawal-agreement-act [4] https://www.instituteforgovernment.org.uk/explainers/1972-european-communities-act [5] https://www.instituteforgovernment.org.uk/blog/reasonable-compromise-european-court-justice-brexit

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