EU Insight, 18 October 2019, Brussels

EU AND UK REACH DEAL ON REVISED WITHDRAWAL AGREEMENT

The EU and UK negotiators reached a deal on a revised Withdrawal Agreement, including the Protocol on Ireland and Northern Ireland, and the Political Declaration on the future relationship. As per the agreement, Northern Ireland will be part of the UK’s customs territory, whilst being aligned to a limited set of EU rules, notably on goods and VAT. In addition, the Northern Ireland Assembly will be able to decide every four years whether the system should be continued. The draft agreement will now be subject to ratification in the UK (a vote is set for tomorrow, 19 October) and, subsequently, in the European Parliament (as early as next week).

EU LEADERS CONDEMN TURKEY’S MILITARY ACTIONS IN NORTH-EAST SYRIA

Besides endorsing the Brexit agreement, the European Council held discussions on EU enlargement, Turkey, climate change, the long-term EU budget, and the EU’s strategic agenda for the next five years. The most significant announcement was that of condemning Turkey’s unilateral military action in north-east Syria, “which causes unacceptable human suffering, undermines the fight against Daʼesh and threatens heavily European security”. Also noteworthy, EU leaders called on the Finnish Presidency of the Council to submit a negotiating box with figures for the 2021-2027 multiannual financial framework (MFF) ahead of the European Council in December.

COMMISSION CONSULTS ON IMPLEMENTATION OF NEW BANKING PACKAGE

The Commission launched a consultation on implementing the final Basel III reforms in the EU. Basel III is a set of international banking regulations developed by the Bank for International Settlements to promote stability in the international financial system. Overall, the scope of the consultation is very broad and covers all the remaining 2017 Basel standards, as well as sustainable finance and the “fit and proper” principle. The deadline to submit a response to the consultation is 3 January 2020. The Commission’s legislative proposal on the implementation of Basel III is expected in June 2020.

EUROPEAN LABOUR AUTHORITY STARTS ITS WORK

The European Labour Authority (ELA) began work by holding its first Board Management meeting in Brussels. The main mission of the ELA is to support the work of the national labour authorities in order to create a more integrated European labour market. Its activities relate to labour mobility’s rules: free movement of workers and the posting of workers, social security coordination, and specific legislation in the road transport sector. The ELA is expected to improve cooperation on labour mobility by providing a permanent EU structure based on national liaison officers seconded by Member States.

FRANCE AND GERMANY AGREE ON 2050 CARBON NEUTRALITY

France and Germany issued a joint declaration calling on the EU to become carbon neutral by 2050. The Toulouse Declaration covers a wide range of policy issues, including climate, defence, innovation, space, and culture. French President Emmanuel Macron and German Chancellor Angela Merkel support the idea of a carbon border tax that would be compatible with the World Trade Organization rules. They also advocate for a minimum carbon price in the EU’s Emissions Trading System. Most of such initiatives are being pushed by Commission President-elect Ursula von der Leyen, as part of her European Green Deal programme.

COMING UP NEXT WEEK:

• 21-24 October: European Parliament plenary session. On the agenda: Review of the Juncker Commission, Turkish military operation in Northern Syria, Brexit, human rights, democracy and rule of law.
• 24 October: Employment, Social Policy, Health and Consumer Affairs Council. On the agenda: Economy of wellbeing, future of work, European Semester, anti-discrimination.

Karl Isaksson, Managing Partner Brussels, Kreab