EU Proposes Vastly Reduced Checks on Goods from GB Entering Northern Ireland

The entry checks on goods from Great Britain imposed by the Northern Ireland Protocol present a significant practical obstacle to intra-UK trade and have revived internal political tensions. Following the UK government’s calls for change, the European Commission proposed new arrangements on 13 October 2021, subject to further negotiation, under which the relevant checks would be reduced. The offer also includes arrangements for heightened engagement with stakeholders and authorities in Northern Ireland, but falls short of addressing the controversial role of the European Court of Justice (the “ECJ”) in the Protocol.

The Northern Ireland Protocol – especially the extensive checks on goods entering Northern Ireland required under this regime agreed between the EU and the UK – has given rise to practical difficulties and significant obstacles to the movement of goods. This finds strong opposition within Northern Ireland, and the issue has ignited underlying political tensions in the region, giving rise to fears that peace in Northern Ireland may be at risk. There are security concerns adding to the complexity of the situation: threats to border control officials have been reported and led to a temporary suspension of checks.

Hong Kong traders may like to know that, as a result, the EU’s Brexit Commissioner, Maroš Šefčovič, has proposed to remove a majority of checks on goods entering Northern Ireland from other parts of the UK. The offer includes the lifting of up to 50% of all customs checks, as well as over half of the various checks applicable to meats and plants. The proposal is made with the mention that it is subject to further negotiation. Amongst other matters, the Commission offers to significantly reduce checks for compliance with sanitary and phytosanitary requirements and a conditional derogation from the manufacturing authorisation required to bring medicines from Great Britain into Northern Ireland under the Protocol. The Commission has published an overview, with concrete examples, of the main areas affected by its offer.

The Commission’s proposal comes in response to the demands of the UK government which has, over the last few months, requested a number of changes to the Protocol on the basis that unforeseen challenges has made it impracticable. On 12 October, the UK’s Brexit minister, David Frost, held a speech in Lisbon, asking for “significant change” in order to facilitate trade between the UK and Northern Ireland. David Frost and Prime Minister Boris Johnson maintain that the agreement for the Protocol was reached in haste, amidst great uncertainty, and that modification is necessary for “a better way forward”.

The UK has demanded simplified procedures to ensure smoother movement of goods into Northern Ireland, and the Commission proposal would indeed reduce the intensity of checks. Furthermore, the UK has voiced general concern as to the democratic deficit of EU institutions involved in the implementation of the Protocol. The Commission’s proposal addresses this issue by suggesting that “structured dialogue”, with the participation of experts, be established between the Commission and Northern Ireland stakeholders and authorities, so as to increase transparency in the implementation of the Protocol.

The UK is also adamant that the ECJ cannot retain jurisdiction on matters of EU law in Northern Ireland and that disputes should instead be referred to international arbitration. Under the current Protocol, the Commission may bring actions against the UK where Protocol provisions are not complied with. Accordingly, the Commission did initiate proceedings in March 2021, which have since been paused. The role of the ECJ is not addressed by the proposal put forth by the Commission.

If no satisfactory solution is found, David Frost has threatened reliance on Article 16 of the Northern Ireland Protocol. Under Article 16, parts of the Protocol could be suspended if they cause "economic, societal or environmental difficulties". However, such a decision might lead the EU to impose tariffs or respond with other trade restrictive measures.

The proposal submitted by EU Commissioner Maroš Šefčovič has been controversial in Brussels and is reported to be in defiance of the French government. It is therefore uncertain whether the UK’s additional demands, and particularly those regarding the ECJ, will be met. Indeed, Maros Šefčovič has stated that it is "hard to see how Northern Ireland would stay or would keep the access to the single market without oversight of the European Court of Justice."

Hong Kong traders operating between the UK and the EU are likely familiar with the Northern Ireland Protocol. Under this instrument, Brexit negotiators have compromised to avoid a “hard border” on the island of Ireland and preserve the Good Friday Agreement, whilst maintaining the integrity of the EU’s Single Market for goods. The Commission’s outline of the Protocol notes that the Union's Customs Code applies to all goods entering or exiting Northern Ireland, that EU customs duties apply to goods entering Northern Ireland from any other part of the UK or any other third country unless those goods are not at risk of moving on to the EU. The Protocol currently provides that all goods moving into Northern Ireland from other parts of the UK are such “at risk” goods, unless they fulfil specific conditions to be considered “not at risk”. The Protocol also provides for rules to ensure that certain product requirements are met, including the abovementioned sanitary and phytosanitary checks on certain goods.

For more information on the Northern Ireland Protocol and the associated discussion, please find the Commission’s proposal, and the accompanying Q&A note.