Tuesday 17 March 2020

The Protocol on Ireland/ Northern Ireland: What it says is not what it does

Professor Stephen Weatherill, Somerville College and Law Faculty, Oxford University

Political misdirection

On Wednesday 11 March 2020, at a meeting of the Future Relationship with the European Union Committee of the House of Commons, the following exchange took place:

Hilary Benn: “On goods moving from GB to Northern Ireland under the Northern Irish Protocol, we know there are some regulatory checks at the moment …  there will be additional checks once the Northern Ireland Protocol is implemented won’t there?”.

Michael Gove: “That’ll be a matter for the Joint Committee”.

No it won’t. No it isn’t. There will be additional checks. Mr Gove is wrong.

He’s not alone. Failing to grasp what are the UK’s legal obligations under the Protocol seems contagious. Interviewed on SKY television on 2 February 2020 Dominic Raab claimed that the imposition of extra checks would be “directly in conflict” with the agreements reached with the EU. He is wrong. He could not be more wrong: the absence of extra checks would be directly in conflict with those agreements. Brandon Lewis, who took over as Secretary of State for Northern Ireland in February 2020, also moved quickly to insist there would be no border down the Irish Sea. He is wrong too, unless the UK plans to violate its international obligations.

But Mr Gove and his colleagues were following a well-trodden trail of misdescription. The Prime Minister has been even more blatantly wrong, and repeatedly so. Interviewed on SKY television in December 2019, shortly before the General Election, he said:

“… there’s no question of there being checks on goods going NI/GB or GB/NI … We’re a UK government, why would we put checks on goods going from NI to GB or GB to NI? It doesn’t make sense.”

On the campaign trail in November Mr Johnson had encouraged exporters to Great Britain from Northern Ireland who were confronted by forms to throw them in the bin: he insisted there would be no checks. He did not change his tune once he had banked victory in the December General Election. In the House of Commons on 22 January 2020 Jeffrey Donaldson of the DUP welcomed the PM’s “assurance that there will continue to be unfettered access for Northern Ireland businesses to the UK single market”, but asked whether that commitment also applies “to goods moving from Great Britain to Northern Ireland?”. “Emphatically it does”, replied Mr Johnson.

Emphatically it does not, as is clear from an understanding of the Protocol.

The purpose of the Protocol

The Protocol on Ireland/ Northern Ireland attached to the Withdrawal Agreement is driven by the perception that, as its Preamble affirms, “the United Kingdom's withdrawal from the Union presents a significant and unique challenge to the island of Ireland” and “that the achievements, benefits and commitments of the peace process will remain of paramount importance to peace, stability and reconciliation there”. Its most high-profile concrete aim is to guarantee avoidance of “a hard border, including any physical infrastructure or related checks and controls” at the frontier between Ireland and Northern Ireland, as the Preamble to the Protocol has it. So the current physically invisible state of the political border on the island of Ireland should not change at all as a result of the UK’s withdrawal from the EU. This matters to the economy, this matters to the preservation of peace.

And, since the checks required at the external frontiers of the EU must occur somewhere, the aim of ensuring that they do not occur at the border between Ireland and Northern Ireland is achieved by ensuring that they shall occur elsewhere, at the border between Great Britain and Northern Ireland. There will be a hardened border within the UK. The Protocol is carefully written: it avoids saying this. But that is what it does. It is what Mr Johnson accepted in abandoning Mrs May’s deal which would not have placed any new restrictions between Northern Ireland and GB but which would have accepted UK-EU regulatory alignment and a single UK-EU customs territory. Mr Johnson’s oven-ready election-winning deal reduced the scope of regulatory alignment to NI-EU alone in order to unleash GB’s regulatory autonomy both domestically and in external trade policy. This inevitably entails new restrictions on trade in goods between Northern Ireland and GB as a result of the absence of regulatory alignment between GB and the EU.

Mr Gove and Mr Johnson and other members of the Cabinet are denying what they have already accepted.

The content and duration of the Protocol

Let us be clear what the Protocol requires – or, put another way, what the UK has already committed to in the legally binding Withdrawal Agreement.

The Protocol locks Northern Ireland (but not the wider UK, i.e. not Great Britain) into regulatory alignment with a weighty body of EU rules governing manufactured and agricultural goods. The detail is found in Annex 2 to the Protocol: 287 EU legislative instruments are listed, all of which are to be applied in Northern Ireland, in order to ensure it is sufficiently aligned to the EU’s internal market acquis for the EU to be prepared to treat the Northern Ireland - Ireland border as soft in the same way that borders found internally within the EU are soft. That NI-EU alignment is extended by the Protocol also to cover key trade rules including those concerning the EU’s customs regime, VAT and excise rules, those governing the single electricity market and state aid rules in respect of measures which affect the trade between Northern Ireland and the EU which is subject to the Protocol.

The Protocol applies after the expiry of the transitional period. That is currently set for the end of 2020, and although the Withdrawal Agreement allows for a one-time extension of up to two years, the UK government has pledged not to seek such extension. (The Coronavirus may change that attitude, but it will not change the content of the Protocol). The Protocol is terminable by a subsequent EU-UK agreement which shall indicate the parts of the Protocol which it supersedes (Article 13(8) Protocol) but for such an agreement to remove the need for the Protocol in its entirety would require the type of comprehensive UK-EU regulatory alignment which is exactly the opposite of what Brexit is intended to achieve, according to the speech delivered by the UK’s lead negotiator David Frost recently in Brussels, though one should not forget that a rather different tale was told by cherry-picking Brexiters back in 2016. The parts of the Protocol which concern trade rules can be set aside according the procedure foreseen by the Protocol’s Article 18, “Democratic Consent in Northern Ireland’, whereby alignment may be brought to an end by decision of the Northern Ireland Assembly according to a managed timetable set out therein. Since this would bring back into play the hard border on the island of Ireland that the Protocol is designed to prevent any such decision seems for the time being improbable. So the likelihood is that the Protocol is here to stay for some time to come. Its true meaning has long-term importance.

But what is its true meaning? The Protocol is not an easy read. The Protocol is not intended to be an easy read. It is an exercise in studied deception. But the key to understanding it is not to look at what it says, but instead to look at what it does.

To which customs territory does Northern Ireland belong?

The Protocol says that Northern Ireland is part of the customs territory of the United Kingdom (Article 4). And this is backed up by Article 5(1) which provides that no customs duties shall be payable for a good brought into Northern Ireland from another part of the United Kingdom by direct transport unless that good is at risk of subsequently being moved into the Union, whether by itself or forming part of another good following processing. So – it seems – the norm is no duties on GB to NI trade, while the exception – where the good is at risk of onward movement to the EU – is payment of duties.

But what the Protocol does in its Article 5(2) is to reverse the presumption expressed in Article 5(1). A good brought into Northern Ireland from GB is considered to be at risk of subsequently being moved into the Union unless it is established that that good will not be subject to commercial processing in NI and fulfils criteria to be established in due course by the Joint Committee. The shaping of the governing criteria by the Joint Committee will plainly be important but the key point right now is that goods are deemed to be at risk of onward movement and so attract an obligation to pay duties – unless it is shown they are not. The burden is on the trader to show that the relatively tightly drawn exception for goods only destined for Northern Ireland and not for processing applies. Article 5(6) grants the UK a power to reimburse duties levied on goods pursuant to the provisions of EU law made applicable by the Protocol – but that assumes that payment has already been made and in any event any such reimbursement must comply with the EU’s state aid rules contained in Article 10 of the Protocol.

The starting point, then, is that duties are payable. So what the Protocol does is not to treat Northern Ireland as part of the customs territory of the UK. That point is strengthened when one understands that, notwithstanding its calculatedly evasive language, what the Protocol does in its Article 5(3) is to lock Northern Ireland into the entirety of the EU’s Customs Code, the Common Customs Tariff, legislation setting up a Union system of relief from customs duty, and international agreements containing customs provisions in so far as they are applicable in the EU (subject only to a reservation to the Joint Committee of the job of establishing the conditions applicable to certain fishery and aquaculture products) and via its Article 5(4) also a number of other customs-related measures, among them the EU’s trade defence instruments covering inter alia anti-dumping and anti-subsidy measures.

So the Protocol says that Northern Ireland is part of the customs territory of the United Kingdom (Article 4) but that is not what it does. De facto Northern Ireland is part of the EU’s customs territory.

Does the Protocol secure unfettered trade within the UK’s internal market?

The Protocol says that it is dedicated to the protection of the UK internal market (Article 6) and that nothing shall prevent the United Kingdom from ensuring unfettered market access for goods moving from Northern Ireland to other parts of the United Kingdom's internal market (Article 6(1)).

But that is not what it does. The UK’s existing internal market is not protected, because what the Protocol does is to require that new barriers be introduced to regulate trade between GB and NI (in both directions, but especially east to west). Some will be required to implement the new customs regime, mentioned above, but others, likely far more significant, will be required to address the point that after the expiry of the transitional period (probably at the end of 2020, pace coronavirus) the GB part of the UK is no longer locked into the “ecosystem” of binding rules and institutional and constitutional disciplines which make up the EU internal market for goods. The point is that given the absence of commitment to persisting regulatory alignment between the EU and GB, the risk arises that goods originating in GB or imported into it from a third country will be routed through Northern Ireland and over the soft border into the EU’s internal market without any payment of tariffs or checks for compliance with EU rules, thereby harming the integrity of the EU’s customs union and internal market. Therefore compliance with EU rules on matters covered by the Protocol such as product composition, safety, technical standards and sanitary and phytosanitary requirements will need to be checked, because GB will no longer be bound by these rules. The Protocol does not say exactly how these checks shall occur, nor exactly how intense they shall be: it is in principle for the UK to implement and apply the EU rules made applicable by the Protocol to the United Kingdom in respect of Northern Ireland, subject to the proviso that EU representatives have the right to be present during any such activities pertaining to implementation and application (Article 12). But it is clear that what the Protocol does is to require that there shall be such checks.

So Article 6(1) of the Protocol’s claim that nothing shall prevent the United Kingdom from ensuring unfettered market access for goods moving from Northern Ireland to other parts of the United Kingdom's internal market (presumably deliberately) misses the point that it is GB to NI – east to west – trade which is the main problem. It will not be unfettered. There will be customs and other regulatory checks on goods exported from Great Britain to Northern Ireland. But Article 6(1) is not even true on its own limited terms. West to east trade within the UK is affected too. What the Protocol does – via, once again, evasive language buried in Article 6 - is to require that the normal formalities applicable to goods leaving the EU’s customs territory shall apply to goods leaving NI for GB. Pursuant to Regulation 952/2013 on the EU Customs Code that means the completion of an exit declaration. Although less intrusive than the impediments on East-West trade within the UK that must be introduced, it is still a requirement that did not previously apply to trade between Northern Ireland and Great Britain.

There will doubtless be a desire to minimise the level of inconvenience to economic operators, and Article 6(2) of the Protocol commits the EU and the UK to use their best endeavours to facilitate trade between Northern Ireland and other parts of the United Kingdom, but some new restrictions there certainly will be. “Unfettered” is not a legal term of art but it is a stretch to describe trade which involves such administrative encumbrances as “unfettered”. At the very least it is plain that what the Protocol does is to change the long-standing terms of trade between NI and GB, and to place them on a different and more cumbersome footing than trade between England, Scotland and Wales. The Protocol says it is protecting the UK’s internal market. What it does is to damage it.

None of this is news to those whose eyes and ears are open. The UK government’s own impact assessment, published on 21 October 2019, is open about the prospect of increases in costs as a result of an obligation to submit to processes and regulatory checks and to complete declarations, both West-East and East-West, albeit that it felt unable to place precise figures on the consequent costs pending detailed policy decisions to be taken by both the UK and the EU. That is: the precise nature and intensity of the additional burdens is not known, but the fact that they will exist is known. This is not what Mr Gove said in March 2020. Both the then Brexit secretary Stephen Barclay, before the House of Lords Select Committee on the European Union on 21 October 2019, and Julian Smith, the then Secretary of State for Northern Ireland, before the Northern Ireland Affairs Committee of the House of Commons two days later accepted that that some new formalities would be introduced on trade between NI and GB. That is not what Mr Johnson said on repeated occasions.  Moreover a leaked Treasury document entitled “NI Protocol: Unfettered access to the UKIM” revealed clearly that there was full awareness of and anxiety about how fettered trade might turn out to be. That is not how senior members of the UK government are now addressing the consequences of the Protocol agreed last year.

Mr Johnson is simply denying what he agreed. Mr Gove seems to be hoping to use the Joint Committee to re-negotiate what was agreed.

What happens next?

If the UK does not comply with the obligations it has agreed under the Protocol, the methods of enforcement are far more closely aligned to those which prevail under orthodox EU law than those associated with the dispute resolution mechanisms based on arbitration found in the Withdrawal Agreement. Article 12 of the Protocol provides that for the key provisions concerning trade regulation in the Protocol the Commission retains its capacity to pursue infringement proceedings against the UK and the Court of Justice too has the jurisdiction provided for in the Treaties, which includes the preliminary reference procedure by which national courts ask the Court of Justice to interpret EU law. Article 13(2) adds that “the provisions of this Protocol referring to Union law or to concepts or provisions thereof shall in their implementation and application be interpreted in conformity with the relevant case law of the Court of Justice of the European Union”.

Article 4 of the Withdrawal Agreement ensures that the domestic courts of the UK may be called on to hold the UK government to the binding promises it has made: it declares that “The provisions of this Agreement and the provisions of Union law made applicable by this Agreement shall produce in respect of and in the United Kingdom the same legal effects as those which they produce within the Union and its Member States”, which embraces the legal principles of the direct effect and primacy of EU law. This is imported into the UK’s domestic legal order by the European Union (Withdrawal Agreement) Act 2020 (see discussion here). So here the familiar features of EU law live on in the UK. This might surprise those who imagined that blocking the role of the Court in particular and that of EU law more generally was a UK red line in the negotiation of the Withdrawal Agreement.

The law will doubtless take its course, but it is the political consequences of Mr Gove and Mr Johnson’s apparent disinclination to take seriously the Protocol which are even more pressing and alarming. And they become more so as every day passes and the UK fails to make the preparations necessary to meet its obligations under the Protocol, entailing most of all the construction of border infrastructure at west-facing ports in England, Scotland and Wales as well as at ports in Northern Ireland. Assuming the UK government sticks to its determination not to seek an extension to the transitional period – a militancy which may yet be subdued by the spread of the coronavirus – those obligations become live already at the end of 2020. This is imminent and it is urgent – yet it is not being treated as such by the most prominent politicians in the UK government.

It has been a consistent feature of Brexit that its principal cheerleaders appear to have only a dim understanding of what it might realistically entail, and moreover that they appear to assume that firm commitments made in consequence on negotiation with the EU can be lightly cast aside when they are seen to unsettle the preferred narrative of a Brexit crafted on British terms. But ripping up promises made with reckless bravado during a referendum or an election campaign is very different from treating binding legal commitments as disposable once the time to meet them looms. There is a dismaying sense that the current Cabinet has been assembled to exclude those such as Geoffrey Cox and Julian Smith who understood and respected the nature of the legal obligations undertaken pursuant to the Protocol, leaving the field clear for Mr Gove, Mr Johnson and others who decline to accept responsibility for fulfilment of the obligations imposed by the agreement which was concluded with the EU last Autumn. The whole point of that deal – the key that unlocked Mrs May’s deal and allowed its replacement by Mr Johnson’s – was that it significantly increased the legal, political and economic significance of the Irish Sea as a frontier within the UK. That the Protocol says things – that Northern Ireland is in the UK’s customs territory, that it secures protection of the UK internal market – which it does not do was doubtless politically convenient for the UK government, and probably a matter of misleading packaging in which the EU felt able last year to acquiesce. One wonders if the EU is now regretting not having insisted that the Protocol more clearly says what it does.

Photo credit: Oliver Dixon via Wikimedia