As many had anticipated, negotiations for a free trade agreement (FTA) between the UK and EU are set to continue despite the initial ‘walk away’ deadline of 15th October.
UK negotiator Lord Frost had a “constructive” call with EU’s Michel Barnier on 20th October, and the EU has stated that the door remains ajar for talks. However, both sides await a fundamental change in approach from the other party to break the stalemate.
Key areas of disagreement remain to include fishing rights and post-Brexit competition rules, known as State Aid, as the EU wants the UK to agree to rules which would limit the extent of Government support that can be given to businesses, despite the fact that the UK may have already scored an own goal with restrictions included as part of the UK-Japan FTA. There is also the controversial approach to amending the Northern Ireland Protocol which would break international law and consequently damage the UK’s reputation.
Irrespective of whether a UK-EU deal is reached or not, there is a tremendous amount of work going on in the background to ensure that everything is in place for the 1st January.
There are also a number of questions that are yet to be answered - what will the final tariff schedule look like?; what additional checks will be required for exports and imports?; will vet capacity be sufficient to meet the demand of Export Health Certificates?
With the EU yet to grant the UK with third-country listing which would significantly reduce friction for food imports into the Single Market, crashing out with no deal and having to fall back on bare bones World Trade Organisation rules is a worst case scenario for any industry.