June 30th 2020 saw three EU deadlines expire. What were they and what happened to them?
First, the TRANSITION deadline. Under the Withdrawal treaty the UK is supposed to apply for an extension of the transition of maximum two years before 30 June 2020. On 12 June Michael Gove confirmed with the EU that the UK will not seek an extension of the transition period beyond 2020. For businesses this means that they have to be ready to operate outside the European Single Market, the EU’s internal market by the end of this year.
Second, a FISHERIES agreement should have materialised by now. However, no agreement on access to fishing waters and markets is on the horizon. Also, the EU said that no fisheries deal by the end of the year will mean no trade deal. This is another reason not to wait to prepare for next year.
Third, the assessments of the equivalence of the EU’s and the UK FINANCIAL RULES should have happened by now. This will determine the level of access of City businesses to the EU financial services market and vice versa. But talks are ongoing and EU Chief Negotiator Michel Barnier has warned the UK against ditching EU rules. Depending on their activity, financial services companies would be strongly advised to consider establishing themselves in the EU to anticipate non-equivalence of rules and non-recognition of licences.
So in summary two of the three mid-term EU exit deadlines will now move to the trade deal deadline of 31 December, which, given the non-extension of the transition period, is a hard deadline. It is therefore vital that businesses anticipate the changes ahead to be able to continue trading normally with their European and UK partners next year.
Sietske de Groot
Trade Peers Ltd
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