As of February 2020[update], the United Kingdom's post-Brexit relationship with the remaining European Union members remains to be negotiated. Following the UK's secession from the EU on 31 January 2020,[a] the UK continues to conform to EU regulations and to participate in the EU Customs Union during a transition period that the UK Government says must end by 31 December 2020. The EU side has said that this timetable in unrealistic. It is possible that a trade agreement will not be completed and negotiations terminated, resulting in a no-deal Brexit.[1]
The Brexit transition period began on 1 February 2020, and is due to end on 31 December 2020. This allows for a period of time to negotiate a bilateral free trade agreement between the UK and the EU.
Post-Brexit negotiations will try to create an ambitious pact between the UK and the EU to avoid disruption as much as possible, according to Michel Barnier.[4]
The UK could have sought to continue to be a member of the European Economic Area, perhaps as a member of EFTA. In January 2017, Theresa May, the British Prime Minister, announced a 12-point plan of negotiating objectives and said that the UK government would not seek continued membership in the single market.[5][6]
The EEA Agreement and the agreement with Switzerland cover free movement of goods, and free movement of people.[12][13] Many supporters of Brexit want to restrict freedom of movement;[14] the Prime Minister ruled out any continuation of free movement in January 2017.[6]
Northern Ireland remains legally in the UK Customs Territory, and is part of any future UK trade deals. This results in a de jure customs border on the island of Ireland, between Northern Ireland and the Republic of Ireland.[16][17]
Great Britain is no longer in a customs union with the European Union. Northern Ireland is also no longer legally in the EU Customs Union, but remains an entry point into it, creating a de facto customs border down the Irish Sea.[18][16][17]
Level Playing Field provisions applying to Great Britain have been moved to the non-binding Political Declaration, although they are still present for Northern Ireland within the protocol.
EU tariffs (which ones are dependent on a UK–EU FTA), collected by the UK on behalf of the EU, would be levied on the goods going from Great Britain to Northern Ireland that would be "at risk" of then being transported into and sold in the Republic of Ireland; if they ultimately are not, then firms in Northern Ireland could claim rebates on goods where the UK had lower tariffs than the EU. A joint EU–UK committee will decide which goods are deemed "at risk".[18][17]
A unilateral exit mechanism by which Northern Ireland can leave the protocol: the Northern Ireland Assembly will vote every four years on whether to continue with these arrangements, for which a simple majority is required. If the Assembly is suspended at the time, arrangements will be made so that the MLAs can vote. If the Assembly expresses cross-community support in one of these periodic votes, then the protocol will apply for the next eight years instead of the usual four. If the Assembly votes against continuing with these arrangements, then there will be a two year period for the UK and EU to agree to new arrangements, with recommendations made by a joint UK–EU committee.[18][17] Rather than being a fallback position like the backstop was intended to be, this new protocol will be the initial position of Northern Ireland for at least the first four years after the transition period ends in December 2020.[15]
According to Michel Barnier, this might raise issues for Northern Irish companies which need the UK to deliver clarity on this topic.[19]