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Tuesday 17 March 2020

Brussels prepared to go rogue if annual fisheries talks break down

The EU intends on locking in access for its fishermen to UK waters no matter how things pan out over the coming years.

Under the hated Common Fisheries Policies, the EU divvies up quotas according to the “relative stability” mechanism, that the UK government says is inaccurate and biased to the likes of France and Spain who gorge on UK fish.

London wants any new arrangement to follow the lines of Norway’s agreement with the EU, and for up-to-date information on stocks to dictate who gets to fish what and where, decided on an annual basis

Naturally, the EU despises the British plan and threatens to keep on fishing in UK waters even if yearly talks fail.

Brussels wants the forthcoming trade agreement to set the percentages of fish EU and UK fishermen are allowed to catch in each other’s waters. The quotas will then act as a permanent backstop. The two sides are miles apart, Britain doesn’t even want fisheries included in the same agreement, but a sensible separate accord.

Needless to say, the EU’s demands are totally unacceptable. Clearly, Michel Barnier and his team have decided to ramp up one side of the fisheries pitch to make up for softening the other.

Barnier’s team has drafted a draft trade agreement. The 441-page document abandons the original demand to keep the Common Fisheries Policy intact.

Existing arrangements must instead be “respected”. The EU is willing to make a compromise, one of the lessons from our excruciating withdrawal from the bloc is Eurocrats don’t know the meaning of the word “respect”.

“I am hearing from colleagues that the draft trade agreement is softer on fisheries than the mandate agreed by the EU,” said one diplomat.

All well and good, but it doesn’t mean much if the EU wants to guarantee access to UK waters permanently.

Financial services: EU rejects UK call for equivalence

The European Commission has denied UK chancellor Rishi Sunak’s request to maintain financial services access to the EU Single Market.

In a letter to Commission vice president Valdis Dombrovskis, Sunak asked “to be able to conclude equivalence assessments swiftly”. Equivalence is the mechanism enabling non-EU businesses dealing in financial services to sell into the bloc. It is often permitted on the basis that regulatory requirements are “equivalent”.

In his letter, Sunak rightly argued that when the UK leaves the Single Market at the end of the year she will share the same regulations, the ideal basis for equivalence. Brussels, which is desperate to keep Britain in the Single Market, doesn’t agree.

It’s a classic contest between British logic and Euro-federalist obsession across the Channel.

Britain “will have to be forward-looking” and would take into account “overall developments, including any divergences of UK rules from EU rules,” said Dombrovskis in his reply letter, seen by City A.M.

Dombrovskis’ rebuke doesn’t make sense. The EU is supposed to hold all the cards with equivalence, if a partner non-EU country decides to regulate its financial services sector differently, equivalence rights can be withdrawn.

The US sells some services through this mechanism as do many other non-EU countries, but Brussels isn’t driving itself crazy trying to keep these countries in the single market.

Carrying on like this will be the EU’s undoing.