John Bell, LLM (Queen Mary University of London)*
Introduction
One does not need to be Nostradamus to see that the UK will have a Labour Government on 5 July. Yet, what will be less clear when the King asks Sir Keir Starmer to form a Government is what this change means for UK-EU relations. The Trade and Cooperation Agreement (TCA) remains the legal foundation for UK-EU relations, with an eco-system of specialised committees working in the background, and the Labour Party have taken an extremely cautious approach ruling out the Single Market, Customs Union and freedom of movement.
Despite the caution, one imagines that the new Government would like to define themselves in opposition to the previous Government, as demonstrated by recent reports of an “improved” TCA “seeking closer alignment with EU rules.” However, red lines mean that the Government can only go so far, and for every step the Government takes to “make Brexit work”, the EU will be wary of “cherry-picking.”
On 18 July, the new Government will host the European Political Community (EPC) meeting at Blenheim Palace. This will be the perfect opportunity for Prime Minister Starmer to meet EU leaders. With such good optics, perhaps this will be the set-piece moment for rapprochement.
This piece will look at the reported plans of the new Government to improve UK-EU relations. Firstly, I will address a possible UK-EU security agreement, before turning to plans for an SPS agreement and lessons that can be learnt from the experience of EU-Swiss relations, before concluding with the impact of European and French elections.
- UK-EU security agreement
As stated in its manifesto, “Labour will seek an ambitious new UK-EU security pact to strengthen co-operation on the threats we face. We will rebuild relationships with key European allies, including France and Germany, through increased defence and security co-operation.”
As Russia’s war against Ukraine continues, a UK-EU security agreement would appear to be a sensible first step in the mutual interest of both parties. Indeed, the EPC’s agenda will likely focus on Ukraine, migration, and energy.
However, it has been reported that the new Government want any UK-EU security agreement to cover “economic and climate security”, which would significantly broaden the definition of a classic security agreement limited to military cooperation. This poses the question of how the EU would approach a “spill-over” into areas already covered by the TCA.
For example, Article 401 of the TCA refers to the “mutual supportiveness of trade and climate policies” and “the removal of obstacles to trade and investment in goods and services of particular relevance for climate change mitigation and adaptation.”
Going further, former British European Commissioner Sir Julian King has argued that an “ambitious” UK-EU security and defence pact should cover law enforcement and judicial cooperation, cybersecurity, intelligence and space cooperation. Whilst enhanced cooperation in these areas is desirable, having such a wide definition of “security” places obstacles to what at first blush looks like a simple pragmatic response to the war in Ukraine.
Indeed, law and enforcement and judicial cooperation is covered by Part 3 of the TCA, therefore the EU could perceive any British offer of a widely defined security agreement as an attempt to renegotiate the TCA by the back door. This may result in the UK Government confining its ambitions to a more classic UK-EU security agreement.
In principle, the Ukraine war is a fairly obvious key to unlock what would be an easy win for UK and EU relations (on defence at least). All eyes on any communiqué from the EPC.
- UK-EU SPS agreement
Perhaps the most visible impact of Brexit is the reintroduction of physical checks for live animals, animal products, plants and plant products at the UK border.
As of April 2024, the UK Government’s Border Target Operating Model (BTOM) took full effect, resulting in additional costs and delay for businesses as health inspectors and vets perform the relevant SPS checks. In addition to cost, the capacity of the UK border posts is an open question and follows several delays in implementation by the UK Government.
Given the cost and impact on business, the Labour Party manifesto states that “We will seek to negotiate a veterinary agreement to prevent unnecessary border checks and help tackle the cost of food […]” Put simply, alignment with the relevant EU Single Market rules would ease disruption to trade and reduce costs. An UK-EU SPS agreement would essentially say that goods crossing between the UK and EU are deemed to meet the same standards, thus obviating the need for physical checks or certification.
An UK-EU SPS agreement would indeed be a welcome step, yet not necessarily a simple one. As ever with Brexit, there is a trade-off between sovereignty and easing disruption to trade. Alignment with EU Single Market rules would be a delicate issue for the new Government, which could be complemented by a role for the European Court of Justice (ECJ).
A much touted potential model for any UK-EU SPS agreement is the EU-Switzerland SPS Agreement, but the EU-Swiss SPS Agreement must be seen within the wider context of EU-Swiss relations. Switzerland and the EU have negotiated over 120 bilateral agreements, of which SPS is but one part alongside air transport, freedom of movement, etc. The EU has been trying for many years to negotiate a single institutional framework agreement with Switzerland, which was rejected in 2021 following Swiss objections to dynamic alignment and notably the ECJ.
In March 2024, the EU and Switzerland agreed to enter into negotiations on a broad package including dynamic alignment and provision for an arbitral tribunal to refer questions of EU law to the ECJ, previously rejected by the Swiss Government.
In this vein, the EU will likely want to avoid replicating the Swiss bilateral approach with the UK more broadly, but a Swiss SPS Agreement still has merit as a model for UK-EU relations on the premise that the UK accepts dynamic alignment and the consequential role for the ECJ in ensuing uniform interpretation of EU law.
A role for the ECJ in any UK-EU SPS Agreement is arguably more nuanced than at first glance. Article 174 of the UK-EU Withdrawal Agreement provides that an arbitration panel can request the ECJ to give a ruling on the interpretation of EU law (which would be binding on the arbitration panel) but this is an exception to arbitration being the primary mode of dispute resolution in the Withdrawal Agreement (and only then after the failure of negotiations in the Joint Committee).
Indeed, it is to be recalled that the institutional framework of the TCA is comprised of the Partnership Council and various Specialised Committees (Articles 7 and 8). Article 4 of the TCA provides that the TCA is to be interpreted in accordance with customary rules of public international law as codified in the Vienna Convention of the Law of Treaties.
The former President of the EFTA Court Carl Baudenbacher has noted that the draft new EU-Switzerland Framework Agreement proposes a scenario where an arbitral panel could request the ECJ for a ruling on the interpretation of EU law, similar to what was accepted by the UK for the Withdrawal Agreement but rejected for the TCA.
In one sense, the TCA and Withdrawal Agreement Committee approaches to governance of UK-EU relations is similar to the EU-Switzerland SPS Agreement. Article 6 of the latter establishes a Joint Committee to which Article 7 gives the role of settling disputes. A comparison can be drawn between Article 7 of the EU-Swiss SPS Agreement and the Withdrawal Agreement. Notably the Swiss agreement makes no direct reference to the ECJ, which is where the Withdrawal Agreement goes further. In the Swiss case, resolution in the Joint Committee is the primary method of dispute resolution. In the Withdrawal Agreement, this is the role of arbitration.
Despite all the noise regarding the ECJ in any UK-EU SPS agreement, the Swiss experience teaches us that any role for the ECJ is nuanced, meaning that it may be easier for the UK and EU to reach an SPS agreement. On the other hand, the Swiss experience may mean that the EU pushes harder for a central role for the ECJ.
As the National Audit Office notes, BTOM has cost the UK Government £4.7bn. This is in addition to the costs and administrative burdens for traders, with consumers bearing the brunt. One cannot eat sovereignty. It is in this context that the new Government must approach alignment and a role for the ECJ.
- The EU perspective
As ever, it takes two to tango. The results of elections to the European Parliament were announced on 9 June, and in a move reminiscent of David Cameron’s decision to call the Brexit referendum, the surge in Far Right votes in France led President Macron to call snap legislative elections for 30 June and 7 July.
Not only is the EU in the post-election process of deciding the top institutional jobs, with a new Commission not expected to be in office until the autumn, EU founding member France faces the prospect of a Far Right Prime Minister promising drastic cuts to its contribution to the EU Budget with all the consequences for EU legislative action that entails.
To be blunt, the EU does not currently have the bandwidth to deal with UK relations. Whatever Prime Minister Starmer may have to say to President Macron at Blenheim Palace on 18 July, Ursula von der Leyen will be at the European Parliament facing her nomination vote.
Conclusion
After the acrimonious severing of 47 years of EU membership, those desiring rejoining the Single Market or even the EU itself may be disappointed at the lack of ambition represented by the new Government’s red lines. In the realm of politics, the caution of a party wanting to gain power is perhaps understandable but red lines can turn pink once victory is secured, especially with a substantial majority in the Commons.
The reported security and SPS agreements would be a shift from simply “making the TCA work.” Such incremental steps, with the caveats argued above, would show a sensible path to closer EU-UK relations. Indeed, when it comes to the security of the nation and the price of food, the new Government has the opportunity to set aside caution and frame the arguments for closer UK-EU co-operation.
The paradox is that whilst the new Government talks about “resetting” the relationship and “improving” the TCA, the EU will be on guard against “cherry-picking.” Nevertheless, a landing strip can usually be found where mutual interests are concerned. A rapprochement to build UK-EU trust would be a welcome start. From Blenheim Palace, good music could turn to substance, but it is still too early to say. Perhaps Nostradamus is relevant after all.
*John Bell, LLM (Queen Mary University of London) is a Legal Assistant at the Financial Reporting Council and a former Schuman Trainee at the European Parliament. John is a regular contributor on Brexit and constitutional law matters. His views are solely his own.
The views expressed in this blog post are the position of the author and not necessarily those of the Brexit Institute blog.