The authoritative source for independent research on UK-EU relations

08 Apr 2021

Relationship with the EU

Union

Why is there a Protocol on Ireland/Northern Ireland?

Brexit meant that the border between Northern Ireland and Ireland became an external border between the EU and a non-member state. Such a border would normally require the full enforcement of customs and regulatory rules, and with it checks and controls. But the Northern Ireland Executive urged the British Prime Minister against allowing such a hard border. It ‘must not’, they stated, ‘become a catalyst for illegal activity’ or ‘create an incentive for those who would wish to undermine […] the political settlement’ as had been established in the 1998 Good Friday (Belfast) Agreement.

The Prime Minister at the time, Theresa May, agreed, as did the EU Council. Meeting these common UK-EU objectives – protecting the 1998 Agreement and avoiding a hard Irish border – became one of the top three priorities in the first phase of negotiations. The dedicated Protocol on Ireland/Northern Ireland in the Withdrawal Agreement provides the legal framework agreed by the UK and EU to meet these objectives.

“The main consequence of this is that there is now a customs and regulatory border in effect on goods moving from Great Britain to Northern Ireland.”

The Protocol now in place is the third version published. At the root of all of them is the question of how to avoid checks and controls at the Irish land border as it becomes an external UK-EU border. The first version was proposed by the EU in February 2018. It imagined a ‘common regulatory area’ between the UK and EU to minimise regulatory divergence and thus reduce trade friction. The second was the so-called ‘backstop’ in the draft Withdrawal Agreement, which would see the UK as a whole form a customs territory with the EU on a temporary basis until a means of frictionless UK-EU trade could be found.

The version negotiated by Boris Johnson in October 2019 sees Northern Ireland follow EU regulatory and customs rules to avoid friction on movement of goods across the island of Ireland. The main consequence of this is that there is now a customs and regulatory border in effect on goods moving from Great Britain to Northern Ireland.

Protocol on Ireland/Northern Ireland

Whereas the May arrangement was intended to be superseded by the long-term relationship between the UK and the EU, the new version of the Protocol is a permanent arrangement for the trade in goods, subject to the continued consent of the Northern Ireland Assembly in a vote every four to eight years. The terms of this Protocol came into full force on 1 January 2021 with the end of the transition period.

What is in the Protocol the Johnson Government negotiated?

The UK and EU had other objectives as well as avoiding a hard Irish border and protecting the 1998 Agreement. These are reflected in the details of the Protocol. The Protocol is designed to meet the UK Government’s desire to be able to diverge from EU rules and conduct an independent trade policy, while protecting the legal integrity of the EU’s single market.

It does this by:

  • Continuing to apply certain EU rules (most particularly in relation to the manufacture and sale of goods) in Northern Ireland. The application of these rules is implemented by UK authorities, but overseen by the European Commission. They can be, ultimately, enforced by the European Court of Justice (ECJ).
  • Applying regulatory controls and checks on goods moving from Great Britain to Northern Ireland, so that they can then freely circulate within the EU’s single market without further checks.
  • Charging EU tariffs on ‘at risk’ goods that might find their way into the EU customs union via Northern Ireland.
  • Limiting the use of state aid that could potentially distort trade between Northern Ireland and the EU.
  • Establishing joint bodies to oversee the operation of the Protocol, together with procedures to resolve disputes which cannot be resolved by negotiation.

The Protocol means that there are no visible changes to the Irish land border and no changes in procedures for goods crossing it. However, it does not prevent change in other aspects of trade, such as the movement of services and people.

The trade in services between Northern Ireland and the EU, including Ireland, is governed in the same way as between the whole UK and EU through the Trade and Cooperation Agreement. People can move freely across the border because the Common Travel Area, which predated EU membership and allows Irish citizens to continue to be able to live and work in the UK and vice versa. But non-Irish EU citizens in Northern Ireland lose their automatic right to live and work there, just as British citizens in Northern Ireland lose their EU rights to live and work in the EU.

Is Northern Ireland now in the EU’s or the UK’s customs territory?

Article 4 of the Protocol states that Northern Ireland remains part of UK customs territory. In principle, this means that the benefits – such as lower duties on certain goods – of UK trade deals can apply to Northern Ireland too. However, any such FTA must not undermine the Protocol. For example, even if a UK-US trade deal results in cheaper, GMO meat on the British market, such food would not be allowed to enter Northern Ireland.

Notwithstanding the fact that Northern Ireland is officially in the UK’s customs territory, Article 5 of the Protocol applies the EU’s Union Customs Code to goods entering NI from third countries. As a consequence, EU import formalities, such as entry summary declarations and customs declarations, must now be completed for all goods being traded into Northern Ireland, including from Great Britain. Similarly, it is the EU’s Common External Tariff that is applied in the first instance to goods entering Northern Ireland from outside the EU.

So while Northern Ireland remains legally in the UK’s customs territory, it is for practicable purposes in the EU customs area.

How are ‘at risk’ goods determined?

The Protocol means that customs duties are payable on goods entering Northern Ireland from outside the EU if they are considered ‘at risk’ of entering the EU – or crossing the Irish border. In December 2020, the UK-EU Joint Committee released its determination on which goods should be considered ‘at risk’. It states that no duties need be paid on goods entering Northern Ireland if the EU’s own tariff is zero, if the UK’s own tariff is equal to or greater than the EU’s, or if the importer can be prove that they are for final sale to or use by persons in Northern Ireland.

The UK Government set up the UK Trader Scheme to help facilitate the movement of such ‘not at risk’ goods into Northern Ireland.

Are some NI businesses paying tariffs on goods coming from Great Britain?

Yes. Even though the UK-EU Trade and Cooperation Agreement creates a zero-tariff deal for direct UK-EU trade, some goods which come into Northern Ireland from the EU via GB are considered to be ‘reimported’ and attract a tariff. The UK Government has said it will refund any duties paid on goods that remain in Northern Ireland, but this reimbursement mechanism is yet to be established.

Is there now a regulatory border in the Irish Sea?

Yes. In order to allow goods from Northern Ireland to circulate freely in the single market, checks need to be applied on goods moving from Great Britain to make sure they meet EU standards. This includes rigorous sanitary and phyto-sanitary (SPS) controls on plant and animal products.

Under Article 12 of the Protocol, the UK is ‘responsible for implementing and applying’ EU law in these areas, but European Commission representatives have the right to be present to ensure this is being done and to receive relevant data. The ECJ has ultimate jurisdiction.

Does NI have to stay aligned to EU rules?

There are over 300 EU legislative instruments that still apply in Northern Ireland. If these are amended or updated, Northern Ireland will be required to stay in line with those changes. This means that if the UK or EU diverge from each other in these standards, the difference in rules applying between NI and the rest of the UK could grow, with knock-on effects for GB-NI trade friction.

The exact process by which Northern Ireland will remain legislatively aligned with parts of the EU acquis is not yet clear. In principle, some of this comes under devolved competence but ultimately the UK Government is responsible for ensuring compliance with the terms of this international agreement.

What has been done to ease the flow of goods into Northern Ireland?

The Government recognises that the Protocol places new burdens on trade between Great Britain and Northern Ireland, just as Brexit places new burdens on trade between GB and the EU. It has set up a number of digital portals to help businesses wanting to bring goods into NI from GB. The Trader Support Service (TSS) issues guidance, offers training, and can make newly required paperwork declarations on behalf of those moving goods into NI. The Movement Assistance Scheme is tailored to those involved in GB-NI animal and plant transportation. It also operates as a central information source, as well as covering the costs of veterinary inspections and certification.

“When Parliament voted on the Withdrawal Agreement it was opposed by Northern Ireland’s MPs. Moreover, the Northern Ireland Assembly did not give its consent to the Withdrawal (Agreement) Act. Wariness of the Protocol comes from two directions.”

Is the Protocol being fully applied?

Not yet. In December 2020, the UK-EU Joint Committee decided to allow certain grace periods for implementing aspects of the Protocol relating to highly-regulated products (such as meat products and medicines) in order to give businesses time to adjust to the onerous new processes required. The first of these was due to end on 1 April 2021.

On 3 March 2021, the UK Government took the unilateral decision to extend grace periods for at least another six months The EU has initiated legal action against the UK but there are also negotiations continuing. It is not clear whether the UK Government sees these moves as temporary or permanent.

Is there scope for making east-west trade easier?

There have been undoubted teething problems in implementing the Protocol. Businesses had little time to adapt to the new rules (especially in the context of the Covid-19 pandemic), and the systems and schemes for implementing them are new and untried. But there are also long-term impediments to trade which will only become clear once the grace periods expire. The biggest challenge relates to the divergence of UK rules from that of the EU, particularly in relation to agri-food, where checks and controls for cross-border movement are strictest.

The Alliance Party of Northern Ireland has called for a ‘comprehensive EU-UK veterinary agreement’ or UK alignment with European rules on animal and plant products. Such arrangements could look similar to the EU-Swiss agreement on agricultural products, which limits non-tariff barriers and reduces the need for checks on agri-food goods by ensuring that Switzerland meets European standards in those areas. Lord Frost, Cabinet Minister in charge of Brexit and UK co-chair of the Joint Committee has ruled this out. Another option could be to try to negotiate a bespoke Northern Ireland arrangement to make such checks only apply to ‘at risk’ goods.

Does the Protocol restrict the UK’s use of state aid?

The UK Government is prevented from using state aid in a way that distorts trade between Northern Ireland and the EU. This clearly restricts the use of subsidies in Northern Ireland. What is less clear is whether state aid that is used in Great Britain could be shown to distort NI-EU trade and therefore also be in breach of the Protocol.

Last year the Government sought to unilaterally restrict the effect of the Protocol on state aid in the rest of the UK through the UK Internal Market Bill, but ultimately dropped those proposals. As part of a resolution agreed with the UK, the European Commission published a declaration clarifying that no market effects that are ‘merely hypothetical, presumed, or without a genuine and direct link to Northern Ireland’ should be subject to an intervention on state aid.

Do Northern Ireland businesses have ‘unfettered access’ to the rest of the UK?

The Protocol states that nothing within it should prevent the UK from giving Northern Ireland business ‘unfettered access’ to Britain. The UK Government defined that as meaning ‘no additional process or paperwork and […] no restrictions on Northern Ireland goods arriving in the rest of the UK’. This is made law through the UK Internal Market Act (2020).

At the moment the UK is not enforcing new border checks and controls on goods entering Britain from the EU or from Northern Ireland. When these do come into play, Northern Ireland potentially becomes a backdoor for the EU into Britain. Therefore the UK Government has promised that it will tighten the definition of businesses that qualify for ‘unfettered access’ to GB in due course.

Are the rights of citizens in Northern Ireland affected by the Protocol?

Article 2 of the Protocol states that the UK ‘shall ensure that no diminution of rights, safeguards or equality of opportunity’ – as written into the 1998 Belfast Agreement – occurs as a consequence of its decision to leave the EU. Human Rights and Equality Commissions in Northern Ireland have formed a dedicated mechanism to ‘monitor, supervise, advise, enforce, and report on’ this commitment. Most people born in Northern Ireland are entitled to Irish citizenship through which they can retain EU citizenship rights, for example freedom of movement within the EU.

How does the Protocol affect the movement of people on the island of Ireland?

Article 3 of the Protocol stipulates that the ‘rights and privileges’ associated with the UK-Ireland Common Travel Area should remain. This means no immigration controls for British citizens in Ireland or Irish citizens in Britain. The reciprocal rights were set out in a 2019 Memorandum of Understanding between the two governments. However, the ending of free movement means non-Irish EU citizens who live in the Republic may not have their qualifications recognised and have lost their automatic right to work there. If they were already working in Northern Ireland prior to 31 December 2020, they will need to hold a UK Frontier Worker permit to continue to do so after 1 July 2021.

How is the Protocol governed?

The Joint Committee is ‘responsible for the implementation and application’ of the Withdrawal Agreement, including the Protocol on Ireland/Northern Ireland. It can make decisions to change the Protocol by mutual consent. It also supervises the Protocol’s implementation.

The Joint Committee is co-chaired by the EU and UK. The EU is represented by European Commission Vice-President Maroš Šefčovič, and on 1 March 2021 Lord Frost replaced Michael Gove as UK chair. The Joint Committee must meet at least annually. Members of the Northern Ireland Executive may be invited to attend meetings of the Joint Committee if matters of the Protocol are being discussed, and if the Irish Government is present.

The work of the Joint Committee is informed by a dedicated Specialised Committee, constituted of senior officials from both sides. North/south and human rights bodies set up under the 1998 Agreement can submit proposals to this Committee. Senior officials from the Northern Ireland Civil Service may be invited to attend meetings of the Specialised Committee if Irish officials are also present.

Reporting into the Specialised Committee is the Joint Consultative Working Group (JCWG), which is a unique type of body. It is intended to ‘serve as a forum for the exchange of information and mutual consultation’ between the UK and EU, in particular on upcoming legislative changes which may affect Northern Ireland.

What safeguards are built into the Protocol?

Under Article 16, either side may ‘unilaterally take appropriate safeguard measures’ in situations where the application of the Protocol ‘leads to serious economic, societal or environmental difficulties that are liable to persist, or to diversion of trade’. Any safeguard measures used should be targeted to redressing the specific grievance, last only as long as required to remedy the imbalance, and disturb the overall functioning of the Protocol as little as possible. This is the Article that the EU briefly threatened to invoke on 29 January to protect EU vaccine supplies.

How are disputes about the Protocol resolved?

There are general provisions for resolving disputes about the Withdrawal Agreement. In the case of a potential dispute arising, one party must notify the Joint Committee, which will aim to find ‘mutually agreeable solutions’. If these are not found within three months, the matter may be passed to an independent arbitration panel to issue a binding ruling within six to 12 months.

There is a special resolution procedure for disputes relating to the Protocol. Article 12(4) of the Protocol states that the ECJ has jurisdiction with regards to the provisions with the Protocol relating to customs, technical regulations, VAT, and state aid. The European Commission can bring a direct infringement claim to the ECJ if it believes the UK to be in breach of the Protocol in these areas.

Failure to comply with the rulings from either process could lead to monetary sanctions being applied. If non-compliance continues, then the complainant party could suspend elements of either the Withdrawal Agreement or the Trade and Cooperation Agreement until the matter is rectified.

Can the Protocol be terminated?

The revised Protocol in October 2019 introduced a democratic consent mechanism. At the end of 2024, the Northern Ireland Assembly will be asked to vote on whether Articles 5-10 of the Protocol – namely those concerning customs and the movement of goods, VAT, the Single Electricity Market, and state aid – should continue to apply.

Consent can be deemed to be granted on the basis of a simple majority. There are measures to assess cross-community support: either a majority of both unionists and nationalists, or a weighted majority (60% approval overall, with 40% of unionist and 40% nationalist Assembly member supporting it). If this is achieved, it will be eight years before another vote is held. If it gets a majority but without cross-community consent, the UK Government will launch an independent review into the functioning of the Protocol and another vote will take place after four years.

In the event of a majority of MLAs voting to discontinue Articles 5-10, there will be a two-year ‘cooling off’ period where the full provisions of the Protocol continue to be in place. The EU-UK Joint Committee will use this time to decide next steps and make recommendations to the EU Council and the UK, who will be responsible for the subsequent new legal agreement to meet the objectives behind the Protocol.

Even if Articles 5-10 are revised, the remaining Articles of the Protocol remain in place, including those maintaining North-South cooperation and ensuring non-diminution of citizens’ rights.

What are the political views on the Protocol in Northern Ireland?

The Protocol achieved the core objectives of both the UK Government and the EU in that it allowed the UK to negotiate a loose relationship with the EU, while protecting the EU’s single market and customs union and avoiding a hard border on the island of Ireland. But when Parliament voted on the Withdrawal Agreement it was opposed by Northern Ireland’s MPs. Moreover, the Northern Ireland Assembly did not give its consent to the Withdrawal (Agreement) Act. Wariness of the Protocol comes from two directions.

Unionists, the majority of whom were pro-Leave, object to the Protocol on the grounds that it treats Northern Ireland differently to the rest of the UK. All the unionist parties in Northern Ireland officially want the Protocol to be scrapped on the grounds of its disruption to the UK internal market. They also object to the democratic deficit faced by Northern Ireland in following EU rules with no say on those rules.

Nationalist and non-aligned parties were strongly pro-Remain. They also resent the Protocol but on different grounds, namely the fact that it has been brought about through Brexit, which the majority of people in Northern Ireland voted against. They argue that the Protocol needs to be made to work, and through a joint UK-EU approach, in order to create the stability needed for the potential benefits from it (such as through free access to the single market) to be realised.

Are there alternatives to the Protocol?

During Theresa May’s premiership there were repeated searches for ‘alternative arrangements’ that would allow the UK as a whole to leave the EU’s single market and customs union without the need for checks and controls on cross-border movements. Nothing was proposed that satisfied EU requirements or that did not require exceptions to be made under international trade law. Nevertheless, the quest for an alternative to the Protocol continues. The Centre for Brexit Policy most recently proposed a model it calls ‘mutual enforcement’. This would require the authorities in both jurisdictions on the island of Ireland to ensure that businesses met the other’s customs and regulatory requirements, without any border checks.  At the moment the Government is not pursuing this, but is instead looking to agree permanent easements to the operation of the Protocol.

By John McStravick, vice chair of Agora Think Tank and researcher, Queen’s University Belfast, Professor Katy Hayward, senior fellow of UK in a Changing Europe, and Jill Rutter, senior research fellow of UK in a Changing Europe. 

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