| Author (Corporate) | United Kingdom: House of Commons: Treasury Committee |
|---|---|
| Publisher | United Kingdom: Parliament |
| Series Title | 4th Report |
| Series Details | (2017-19) HC473 |
| Publication Date | 14/12/2017 |
| Content Type | Policy-making, Report |
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Further information + The Committee supported a time-limited ‘standstill’ transition arrangement after the Article 50 negotiations conclude, and welcomed the broad alignment between the UK and EU27 on this issue. + It agreed with the Chancellor that transitional arrangements are 'a wasting asset'. They should be sufficiently simple to negotiate within a matter of weeks, to provide early certainty from 30 March 2019, and to maximise the time available for subsequent discussion on the future framework for trade. + It was highly likely that for certain sectors, including financial services, the ‘standstill’ transition period would have to be followed by an adaption period, once the terms of the future relationship become known with clarity. + The Committee strongly supportd the Government’s objective of maintaining 'the freest and most frictionless trade possible', but considered it 'very challenging' for the terms of the ‘bespoke’ free trade agreement envisaged by the Government to be fully agreed within the Article 50 process. + Taking this into account, there were two broad possible outcomes for UK-EU trade on 30 March 2019: a reversion to a trade relationship based on WTO commitments (so-called 'no deal), or the preservation, on a temporary basis, of the status quo, through a standstill transition. + The difference between these two outcomes was dramatic, and it was overwhelmingly in the economic interests of both the UK and the EU to reach an agreement on transition. + The Government appeared to consider it inevitable that arrangements would be reached in the dying days of the Article 50 process to mitigate the most disruptive consequences of a ‘no deal’ scenario. But the history of international trade diplomacy was replete with examples of short-sighted political considerations prevailing over economic self-interest. + Firms were starting to take action to prepare for a ‘no deal’ scenario, and this would gather momentum over time. Reaching an agreement on transition was therefore an urgent priority. If it expedites the negotiations, the Government should not rule out a transition arrangement that encompasses EU rules beyond those pertaining to the Single Market and Customs Union, and retained, on a temporary basis, the principles of direct effect and supremacy of EU law. Visible disagreement between the parties on these points of principle would lead to a loss of confidence among businesses, and diminish the value of whatever is eventually negotiated. + The Committee heard two reasonable ways of giving effect to a ‘standstill’ transition: + Transitional arrangements would exist to allow preparation for the UK’s future outside the EU. Nothing in the Withdrawal Agreement should prevent the UK from starting the process of establishing independent trade relationships during the transition period.The United Kingdom: House of Commons: Treasury Committee published a report called Transitional arrangements for exiting the European Union on the 14 December 2017. In the report the Committee argued that agreement on standstill transitional arrangements between UK and EU27 after March 2019 was now urgent. |
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| Source Link | Link to Main Source https://publications.parliament.uk/pa/cm201719/cmselect/cmtreasy/473/473.pdf |
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| Countries / Regions | Europe, United Kingdom |
