The United Kingdom and EU in Trade Deal Friction

Legal separation can be painstaking and tedious. Especially if this involves access to critical agricultural commodities, such as fisheries, on a post-Brexit agreement. The UK was one of the EU Member States before it left the supranational body, effective on January 31, 2020. It currently undergoes transition until the end of the year.

Under the EU’s Common Fisheries Policy (CFP), the EU and UK will have equal access to each other’s waters. This excludes those waters located in the first 12 nautical miles out from the coast. This will be observed until the end of its transition period.

Inside the EU, the exclusive economic zone (EEC), 200 miles north of the Atlantic, is a shared resource among member states. After the UK’s exit, the country will have legal and sole sovereignty over the EEC. Meaning, it has the exclusive jurisdiction on whether to grant EU member states fishing rights over the waters. The UK is adamant not to give concessions, saying that British fishing grounds are for British boats.

The UK is a big importer of fish and its by-products, most of which come from the EU Member States. Should it decide to cut the EU’s access to the contested waters, it could finally leverage its exclusive access to develop fish-exporting business for its economic advantage.

What Happens Next?

The EU is under much pressure from its fishing communities. To prevent their dislocation from waters, they gave a quid pro quo compromise. Without allowing them to pass to the waters, the United Kingdom will not get access to the EU single market.

The EU single market is imperative to the UK. EU Member States account for 50% of the UK’s import and export. Without free trade privileges, such as the elimination of tariff and non-tariff barriers that support the free flow of goods, services, capital, and labor, the UK is in a critical position. This will put the UK in search of new trading partners where it could establish bilateral and multilateral FTAs or resort to finally granting EU fishing communities what they ask. 

Chief Brexit Negotiator of the EU Michael Barnier said that the United Kingdom’s refusal to accept a balanced agreement on fisheries might make a trade agreement between the two parties “unlikely”. 

Should both parties fail to reach a mutual agreement by the end of the transition period, trade between the UK and EU will follow the necessary trade rules imposed by the World Trade Organization, and as such will not be beneficial for both parties.