Cabinet Office minister Michael Gove has told MPs that he wants to strike a “comprehensive free trade agreement” in 10 months and warned the European Union that, unless there is a “broad outline” of a deal by June, the UK will walk away from trade talks.
However, he said the UK needs a free trade deal that protects standards without obliging the UK to follow EU rules: “The government seeks an FTA [free trade agreement] with robust protections for ‘the environment’ and ‘labour standards’. But we do not see why the test of suitability in these areas should be adherence to EU law and submission to EU models of governance.
“The EU does not apply those principles to free trade agreements with other sovereign nations, and they should not apply to a sovereign United Kingdom.”
The government yesterday published its negotiating mandate, ahead of trade talks due to begin on Monday.
The UK “will not negotiate any arrangements in which the UK does not have control of its own laws and political life,” said The Future Relationship with the EU: The UK’s Approach to Negotiations document.
It also outlines that the UK’s aim is for a trading relationship with the EU similar to the ones the 27-nation bloc has with Canada, Japan and South Korea, and that there will be no jurisdiction for EU law or the European Court of Justice in the UK.
The UK will rely on World Trade Organization (WTO) rules under an arrangement with the EU similar to Australia’s if progress on a comprehensive deal cannot be made, said the document.
The government wants to agree a “broad outline” of a deal with the EU “capable of being rapidly finalised by September” in the next four months. If that does not happen, it will decide whether to switch focus to leaving on WTO terms at the end of December.
In response to this negotiating mandate, Andrew Opie, director of food and sustainability at the British Retail Consortium (BRC), said: “Negotiators need to make the most of every minute available to get the best possible deal for consumers. Ending the process at half-time would certainly not achieve that.”
He added: “It is encouraging that the UK is aiming for a zero-tariff zero-quota deal, which attempts to reduce sources of trade friction. The BRC and its members have been clear that this is essential to protect consumers from higher costs in the future. Pragmatic agreement by both parties is vital to ensuring a trade deal that works for British and EU consumers.
“However, retailers still lack clarity on issues such as VAT. This is doubly true in Northern Ireland. Ultimately, both sides need to work with business to ensure there is enough time to implement big changes on everything from taxation to training. This may include the need for adjustment periods for certain sectors to phase-in new rules where necessary”.