Gibraltar could yet face no-deal Brexit, chief minister warns – POLITICO

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LONDON — Gibraltar could yet face the effects of a Brexit no-deal despite the agreement between Spain and the U.K. to allow the British overseas territory to join the Schengen passport-free area, the Rock’s chief minister said.

Fabian Picardo issued the warning during a House of Lords EU committee hearing Tuesday, where he cautioned that the agreement could fall apart in coming months.

The deal allows for Gibraltar, which was ceded to Britain in 1713 during the War of Spanish Succession, to join Schengen under the auspices of Spain.

That means Gibraltar’s international border will move to its airport and seaport, paving the way for the demolition of the 1.2-kilometer physical barrier that separates the territory from Spain. Management of that crossing has long poisoned relations with Madrid.

The “in-principle agreement”, struck on December 31, is still non-legally binding and must be transformed into an international treaty between the EU and the U.K.

The deal has been submitted to the European Commission, which must confirm whether it can form the basis of a treaty, Picardo said.

Brussels will need to appoint a task force and agree on a negotiating mandate before treaty talks can start with the U.K. government, which is responsible for Gibraltar’s foreign policy.

The Commission must also give its view on the timetable for the talks and could opt for a longer negotiating period than the six months envisaged by Spain and Gibraltar.

“We should not take it for granted that there will be a treaty in six months,” Picardo said. “We have to prepare … for Gibraltar to have to go through a hard Brexit if we are not able to persuade the European Union that there should be a treaty, or we are not able to agree a treaty.”

As part of the process, the Commission will want to be satisfied that arrangements for removing border controls “protect the European single market in goods in a way that will not create distortion,” Picardo added. “So there might be some reinforced alignment in some areas.”

Under the terms of the deal, Gibraltar accepted that it will apply “substantially” the same duties and trade policy measures as the EU, including decisions on customs, excise and VAT legislation, as well as to share reliable statistics on imports with the EU. However, the details are still subject to negotiation, Picardo said.

The treaty negotiations might end up covering many more issues regarding Gibraltar’s future relationship with the EU, such as social security cooperation, potentially extending the length of the talks, he added.

Gibraltar’s visa policy could also be aligned to Schengen to ensure safe access to Gibraltar, Picardo told peers. Holders of Schengen multiple-entry visas, allowing them to enter more than one Schengen member country, could be able to enter Gibraltar for 21 days, he explained.

The chief minister also expressed confidence a mechanism to replace the European Arrest Warrant could be agreed, to prevent those fleeing justice from seeing Gibraltar as a safe haven.

More risks lie ahead. Under the in-principle agreement, the European Border and Coast Guard Agency, known as Frontex, will patrol Gibraltar’s airport and seaport entry points for four years, after which no arrangements have yet been agreed.

If Frontex were to withdraw after that transition period, Picardo said, no chief minister would be able to accept that its role be taken over by Spanish law enforcement authorities because of the “institutional damage” done to Gibraltar’s trust in Spanish institutions in recent decades.

His preferred outcome would be for Gibraltar’s Borders and Coast Guard Agency to take over those responsibilities, provided that Gibraltar succeeds in gaining the confidence of the Commission and Spanish government during the transition.

Spanish politicians have previously expressed misgivings about the capacity of Gibraltar’s authorities to prevent cross-border crime.

The treaty will “no doubt” have a clause allowing all parties to undo the deal, Picardo added, leaving the door open for the British government to exit the arrangements in the future.

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Brexit talks pushed beyond deadline in bid to avoid no-deal scenario

Crunch Brexit talks between Britain and the European Union will continue beyond Sunday’s deadline in a last-ditch attempt to avoid a dreaded no-deal exit when the UK officially leaves on January 1.

After a phone call on Sunday morning, British Prime Minister Boris Johnson and EU Commission President Ursula von der Leyen said it had been agreed that negotiators would go “the extra mile” in the next few days to reach a trade deal agreement.

Both had said on Friday that a “no-deal” was now the most likely outcome, but with negotiations still underway on Sunday, the supposed final deadline, it was confirmed talks would continue.

“Despite the exhaustion after almost a year of negotiations, despite the fact that deadlines have been missed over and over, we think it is responsible at this point to go the extra mile,” Ms von der Leyen and Mr Johnson said in a joint statement.

The United Kingdom quit the EU in January this year but remains an informal member until December 31 when it will finally leave the union’s orbit after 48 years.

A Brexit without a trade deal would damage the economies of Europe, send shockwaves through financial markets, clog borders between Europe and the UK and cause chaos through the delicate supply chains across Europe and beyond.

“Every opportunity to reach a deal is highly welcome,” German Chancellor Angela Merkel told reporters in Berlin.

Irish Foreign Minister Simon Coveney said that talks continuing was a good signal, and that a deal was still possible despite being very difficult.

“Time to hold our nerve and allow the negotiators to inch progress forward — even at this late stage. Joint statement on Brexit negotiations is a good signal. A deal clearly very difficult, but possible,” Mr Coveney posted on Twitter.

‘Where there’s life, there’s hope’

The two sides have struggled to agree on fishing rights in British waters and EU demands that Britain face consequences if in the future it diverges from the union’s rules for fair competition — what it calls a level playing field.

Mr Johnson said that the UK would not be walking away from the trade talks, but warned people to prepare for a no-deal Brexit on December 31.

“I’m afraid we’re still very far apart on some key things, but where there is life there’s hope, we’re going to keep talking to see what we can do, the UK certainly won’t be walking away from the talks,” he said.


Mr Johnson added that a deal was there to be done if the EU wanted one, repeating his offer to speak to other EU leaders.

He said an exit without a trade deal was still the most likely outcome.

Australia does not have a free trade deal with the 27-nation EU but does do business with the bloc, albeit to a lesser degree than the UK, mainly due to geography.


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No-deal Brexit odds – what are the chances of the UK leaving the EU without a trade deal?

How have the odds changed?

Throughout 2020 bookmakers have offered shorter odds on the probability of a trade deal as the final deadline looms. 

In the months after Brexit Day on Jan 31, when the UK officially and legally left the European Union, bookmakers’ odds heavily favoured no deal.

But since then, the implied probability of no deal being reached has fallen considerably.

Implied probability is the likelihood of a particular outcome based on the betting odds on offer at the time. For example, odds of 2/1 would typically yield the desired outcome once in every three scenarios, so the implied probability would be 33.3 per cent.

Over the course of the year the implied probability of a no-deal exit has fallen from a high of 94 per cent in early April to a low of 17.6 per cent at the start of December, suggesting bolstered confidence among bookies of a deal being reached.

After the sixth round of negotiations, which concluded on July 24, the implied probability of a no-deal Brexit fell dramatically.

They were the first round of talks since the UK had allowed the deadline to apply for an extension to the transition period to lapse, effectively locking in place the deadline which now looms – Dec 31.

At the time EU negotiator Michel Barnier said their “resolve remains unchanged” despite talks remaining “far away” on several key issues including the “level playing field” and fishing quotas.

Both remain sticking points today.

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Brexit: No-deal navy threat ‘irresponsible’, says Tobias Ellwood

Brexit: UK-EU talks continue as Navy boats put on standby

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Navy ships to guard UK fishing waters if there’s a no-deal Brexit – POLITICO

Royal Navy vessels armed with machine guns could be deployed to guard Britain’s fishing waters if there is a no-deal Brexit.

Four 80-meter-long patrol ships will be available from January 1 to patrol the English Channel and Irish Sea to stop illegal fishing, according to local media.

The U.K. government is preparing legislation to extend the powers of Britain’s naval police so they can board foreign vessels and arrest EU fishermen if they enter U.K. waters after a no-deal Brexit. They’d also be able to impound EU fishing vessels.

Although patrol vessels carry machine guns, they would not be expected to use weapons against EU boats. “Nobody is going to be firing warning shots against French fishermen; firearms are only used when there is danger to life,” a navy official told the Guardian.

British Prime Minister Boris Johnson warned on Thursday that there is a “strong possibility” of no Brexit trade deal.

As part of contingency measures released on Thursday, the EU wants to continue allowing EU and U.K. vessels to fish in each other’s waters after the Brexit transition period ends on December 31, “to guarantee the sustainability of fisheries” and because of “the importance of fisheries for the economic livelihood of many communities.”

Some 42 percent of all fish caught by EU fishing crews are plucked out of British waters. That figure is even higher for fishermen from nearby coastal countries such as Belgium and the Netherlands.

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UK PM Johnson warns EU over Brexit trade talks: back down or it’s no-deal

By: Reuters | London |

Updated: December 9, 2020 9:22:38 pm

Britain’s Prime Minister Boris Johnson gestures as he leaves Downing Street in London, Britain December 9, 2020. (Image: Reuters)

British Prime Minister Boris Johnson warned the European Union on Wednesday it must scrap demands which he says are unacceptable if there is to be a Brexit trade deal to avoid a turbulent breakup in three weeks.

With fears growing of a chaotic no-deal finale to the five-year Brexit crisis, Johnson was heading to Brussels later on Wednesday for talks with European Commission President Ursula von der Leyen over dinner at 1930 GMT.

Both sides cast the meeting as a chance to unlock the stalled trade talks but acknowledge there is a danger that there may be no trade deal in place when Britain finally leaves the EU’s orbit on Dec. 31.

Johnson said Brussels wanted the United Kingdom to comply with new EU laws in the future or be automatically punished, and was insisting it give up sovereign control over British fishing waters.

“I don’t believe that those are terms that any prime minister of this country should accept,” Johnson told the British parliament to cheers from lawmakers in his Conservative Party.

Also Read: EU, UK leaders feel out trade deal positions over ‘last supper’

Johnson said “a good deal” could still be done if the EU scrapped its demands, but Britain would prosper with or without a trade deal.

A British government source said a deal may not be possible, as did EU chief Brexit negotiator Michel Barnier.

Britain formally left the EU in January, but has since been in a transition period during which it remains in the EU single market and customs union, meaning that rules on trade, travel and business have stayed the same.

That ends on Dec. 31. If by then there is no agreement to protect around $1 trillion in annual trade from tariffs and quotas, businesses on both sides will suffer.

No-deal fears

Failure to agree a deal would snarl borders, shock financial markets and sow chaos through supply chains as the world faces the economic cost of COVID-19.

A measure of expected price swings in the British pound known as overnight implied volatility jumped 25% to the highest since March..

Johnson portrays Brexit as a chance to give Britain an independent, more agile economy. EU powers fear London wants the best of both worlds – preferential access to EU markets but with the advantage to set its own rules.

That, they say, would undermine the post-World War Two project which sought to bind the ruined nations of Europe – and particularly Germany and France – into a global trading power.

German Chancellor Angela Merkel, Europe’s most powerful leader, said there was still a chance of a deal but the integrity of the EU’s internal market must be preserved.

“If there are conditions from the British side which we cannot accept, we are prepared to go down a road which is without an exit agreement,” she told German parliament.

The main sticking points have been over fishing rights in Britain’s rich waters, ensuring fair competition for companies on either side, and ways to solve future disputes.

“Don’t get your hopes too high here,” Irish Foreign Minister Simon Coveney said. “Failure is a distinct possibility.”

Britain said on Tuesday it had clinched a deal with the EU over how to manage the Ireland-Northern Ireland border, and would now drop clauses in draft domestic legislation that would have breached a Brexit withdrawal agreement signed in January.

Michael Gove, one of Johnson’s senior ministers, said that agreement opened “a smoother glide path” towards a trade deal. But if a trade deal is not done, finance minister Rishi Sunak will take steps to ensure British businesses are competitive, Gove said.

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Newspaper headlines: ‘Cabinet backs PM over no-deal Brexit’

The Sun on Sunday says it was a “caustic” call in which the prime minister

said the EU’s “unrealistic demands” had reached their limits.

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Brexit trade talks enter last leg with no-deal deadline weeks away

British Prime Minister Boris Johnson meets with European Commission President Ursula von der Leyen in London, Britain, Jan. 8, 2020.

Xinhua News Agency | Xinhua News Agency | Getty Images

LONDON — The U.K. and the EU are in the “last leg of negotiations” over a post-Brexit trade agreement, according to Britain’s foreign minister, with only a few weeks left to approve any potential deal. 

The U.K. stopped being a member of the EU in January, but it agreed to keep following European rules until the end of 2020 so both sides could formulate new trade arrangements. However, this has proven to be a difficult task with talks stuck over the same three issues since the spring.

“I do think this is a very significant week, the last real major week,” Dominic Raab, told the BBC on Sunday.

Both sides need to reach new trade arrangements and rectify them in their respective parliaments before the end of the year. Failure to achieve that could lead to a no-deal scenario — higher costs and barriers for exporters on both sides.

According to Raab, a breakthrough depends on overcoming differences over a “fairly narrow” number of issues. The major sticking points remain over fishing, competition policy and governance of any future deal. They have different views on how much access European fishing crews should have on U.K. waters, and on what sort of market competition rules should be applied to ensure Britain’s departure does not jeopardize the EU’s single market.

The EU’s chief negotiator, Michel Barnier, told journalists in London on Sunday: “Let us work, let us work,” according to Sky News in reference to the likelihood of a deal.

Before arriving in London for more talks, Barnier said Friday that the “same significant divergences persist.”

Deal or no deal?

Earlier last week, European Commission President Ursula von der Leyen said that “these are decisive days” in the process, but she could not say whether there would definitely be a deal. The message in London since then has been more positive.

David Frost, the U.K.’s chief negotiator, said Friday that “it is late, but a deal is still possible.”

A European official, who didn’t want to be named due to the sensitive nature of the talks, told CNBC over the weekend that a breakthrough is dependent on a phone call between U.K. Prime Minister Boris Johnson and von der Leyen.

However, there aren’t yet any plans for a call between the two.

In the meantime, businesses on both sides wait for an end to the process. The British Chambers of Commerce, a trade body for businesses, warned in late September of “major gaps” in government guidance for firms if no deal is reached.

As a member of the EU for more than 40 years, many U.K. exporters rely on raw materials or clients based in Europe and vice-versa.

Carmakers are reportedly stockpiling cars and parts to avoid being hit with tariffs in case the U.K. and the EU do not reach an agreement. Brands such as Volkswagen and Honda have large manufacturing plants in the U.K. and then export them to the rest of the EU.


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Decisive days for Britain trade pact, European Union prepares for a no-deal Brexit

BRUSSELS: The European Commission cannot guarantee there will be a trade pact with Britain after its departure from the European Union and the coming days will be crucial, the EU’s chief executive said on Wednesday, adding the bloc was prepared for a no-deal.

“The next days are going to be decisive. The European Union is well prepared for a no-deal scenario,” European Commission President Ursula von der Leyen told the European Parliament.

“With very little time ahead of us, we will do all in our power to reach an agreement. We are ready to be creative”, she said.

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European leaders urged to prepare for no-deal Brexit, Michel Barnier tests positive for COVID

If a deal isn’t reached by year-end, businesses and consumers will face disruption and cost as tariffs and quotas return. In recent days, though, officials on both sides had privately voiced cautious optimism that a deal could be concluded as soon as next week, suggesting the comments by the two leaders may be an attempt to pressure the UK government to compromise.


After eight months of negotiations, the two sides still have work to do to get past long standing sticking points — including access to UK fishing waters, a level playing field for business, and how any agreement is enforced — and the time required for any deal to be ratified is running short. The post-Brexit transition period expires December 31.

Rona Thompson, who is the third generation of Thompson family sheep farmers in Romney Marsh, England, said that her greatest concern over the current Brexit negotiations was the uncertainty.

Her fear is that a no-deal Brexit would leave much of the stock “worthless”. He said potential tax rises on export into EU markets, and high prices that UK consumers were not able or prepared to pay, have cast a shadow of the future viability of the business.

The National Sheep Association has warned that 45,000 British sheep farmers could experience a price collapse in the event of a no-deal Brexit as EU tariffs on lamb would be between 46 and 48 per cent. Ninety per cent of British lamb is exported to the EU.


Members of the British negotiating team, who haven’t gone into quarantine, will return to London shortly, according to a person familiar with the talks. A government spokesperson said discussions with the EU would continue remotely until it was judged safe to resume them in person.

This isn’t the first time the coronavirus has disrupted the negotiations. In March, Barnier, Frost and several members of their teams were forced into isolation after either testing positive for, or showing symptoms of, COVID-19. The two sides were also forced to suspend face-to-face discussions as Europe went into a Continent-wide lockdown earlier this year.

Bloomberg, Getty

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