EU comments further on future EU-UK relationship

Today, the European Commission President (Ursula von der Leyen) and the EU's chief Brexit Negotiator (Michel Barnier) addressed the European Parliament on the future of the EU's relations with the UK.

In her speech, Ms von der Leyen reiterated the EU's ambitions for its anticipated free trade agreement with the UK, in particular: "a zero tariffs and a zero quotas trade relation for all goods" along with "corresponding guarantees on fair competition and the protection of social, environmental and consumer standards…the level playing field". Ms von der Leyen noted the UK Government's desire to pursue a free trade agreement based on the Canadian model, CETA. In closing, Ms von der Leyen commented that the Task Force for Relations with the United Kingdom ("UKTF") was ready to start negotiations.

In his remarks, Mr Barnier reminded the European Parliament that the transition period (currently due to expire at 11pm GMT on 31 December 2020) in the Withdrawal Agreement can be extended for a period of up to 1 or 2 years (providing this is agreed by 1 July 2020), but that this was the UK's choice, and that if no trade agreement between the EU and UK is reached by the end of 2020 that the UK will leave the Single Market and Customs Union and revert to trading on WTO terms. In relation to financial services, Mr Barnier underlined the EU's position: "Wherever possible we will grant equivalence on particular sectors of the financial industry. That is what we did with Canada, that’s what we do with the United States and Japan, and it works. So I don’t see why it shouldn’t work with the United Kingdom" but that "There will not be general, open-ended, ongoing equivalence in financial services…We will keep control of these tools and retain a free hand to take our decisions". Mr Barnier also stated that he expects that the EU's new negotiating mandate for the future EU-UK relationship will be agreed on 25 February 2020.