With time running out on UK-EU trade talks, Europe makes a key suggestion to break the impasse

Thu 30 Jul 2020
Posted by: William Barns-Graham
Trade News

brexit dispute

The European commissioner for trade has called on the UK to publish details of the subsidy control regime it plans to implement when the transition period ends on 31 December 2020.

Phil Hogan said state aid was the most pressing of the “five or six” remaining obstacles to a deal and said Brussels was nervous that too much of the negotiation is being left to the last minute.

UK officials have claimed the EU does not need to have regulatory oversight of the UK’s regime, amid reports earlier this week that Dominic Cummings is among those pushing for a ‘light touch’ regime.

Give and take

Talking to five European newspapers – including the Guardian – yesterday (29 July), Hogan said the EU could accept a lighter touch proposal but the bloc wants to be able to be make its own “strategic” exemptions to its state aid regime in response.

In the absence of level playing field rules, EU states would want the ability to back EU industries competing with the UK.  However, he reiterated the EU’s preference is for a legal framework overseeing subsidies.

“It’s in the interest of both sides to have a framework for state aid because I think the UK will be concerned that some of the state aid exemptions we might introduce strategically might not be always in the interest of the UK,” the former Irish minister said.

“We are still waiting for the state aid rules that the UK promised some time ago. In order to settle this, we need to hear what they will propose.”

Meaningful negotiations

On the negotiations in general, Hogan said the UK has only “come to the table in terms of meaningful negotiations” in the “last week or two”.

He believes British businesses have played a role in spurring a “change of attitude” from the UK government.

“I think there is now a realisation by people in the negotiating side of the UK that time is running out,” he said. “British businesses have started to be more vocal, privately and publicly, in relation to the importance of reaching a deal.”

Unusual approach

A UK government spokesman responded to Hogan’s claims, telling the Guardian that the UK had “engaged constructively” throughout the talks but the “EU’s unusual approach” has slowed down any progress.

“Both sides will need to work energetically if we are going to get an agreement in September,” the spokesman said.