No-deal Brexit: EU warns its citizens to prepare for the worst

http://www.theguardian.com/politics/2018/jul/19/no-deal-brexit-eu-warns-citizens-prepare-for-worst

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The EU has issued a warning that the impact of a no-deal scenario would be “very real” for citizens, and left open the question of a visa requirement for Britons travelling to the continent.

In a 16-page document published by the European commission, the remaining 27 member states, along with businesses, have been urged to step up their preparations for an outcome in which the UK would crash out of the bloc next year.

In sectors ranging from financial services to aviation and pharmaceuticals, governments and companies have been told to prepare for the worst, with barriers to the normal running of affairs expected to be erected.

A senior EU diplomat said the “volatile” political situation in London and the lack of progress in the talks in Brussels on key issues had led many to believe that the risk of a no-deal scenario had increased in recent weeks.

“Important issues remain open,” the document says. “No progress has been made in agreeing a ‘backstop’ to avoid, independently of the outcome of the negotiations of the future partnership, a hard border on the island of Ireland.”

The document, Preparing for the Withdrawal of the United Kingdom from the European Union on 30 March 2019, warns that the precarious nature of the talks makes action vital.

“Contingency planning for the worst possible outcome is not a sign of mistrust in the negotiations,” the paper says. “The commission is devoting very significant resources and committing great efforts to achieve an agreement. This remains our goal. However, the outcome of negotiations cannot be predicted.”

The “no deal” document was published hours before the new Brexit secretary, Dominic Raab, was to arrive in Brussels for his first meeting with the EU’s chief negotiator, Michel Barnier, although a commission spokesman denied that the two events were connected.

The document is stark in its analysis of the impact on economies on both sides of the Channel.

It says: “The European Union must apply its regulation and tariffs at borders with the United Kingdom as a third country, including checks and controls for customs, sanitary and phytosanitary [regarding plants] standards and verification of compliance with EU norms.

“Transport between the United Kingdom and the European Union would be severely impacted. Customs, sanitary and phytosanitary controls at borders could cause significant delays, eg in road transport, and difficulties for ports.”

The EU document also covers the movement of British citizens to the continent, noting that the country would need to be placed on one of two lists regarding a need for visa for travel.

Asked about the unlikely outcome of UK citizens requiring a visa, an EU official responded that Brussels was leaving the issue open. “I cannot give you the answer today,” he said.

The document points out that even if there is a deal, there would be changes in the way businesses traded. Larger corporations were already turning their backs on the UK as a consequence of the Brexit process, the commission claimed.

“Untangling a relationship built over more than 40 years will inevitably result in significant changes in the interactions with the United Kingdom at all levels, including economically and legally,” the document says. “Everyone must therefore prepare for the changes that the departure of United Kingdom will inevitably bring ... Many companies are relocating to EU27 or expanding their business in EU27.”

An EU official added: “We have the impression that since a few weeks a no return point has been considered by a certain number of industrial sectors and that they are taking their decisions.

“You have seen some declaration of corporations saying that they are reconsidering investment, they relocating part of their activities, transferring their marketing authorisation for example for pharmaceuticals in the EU. This is ongoing.

“But the big difficulty is to reach out to the millions of small and medium-size companies which have only the experience of working and operating in the EU single market.”

Barnier will discuss Brexit with European affairs ministers from the EU27 on Friday. They will not take a position on Theresa May’s hard-fought compromise plan, agreed among the cabinet at Chequers this month, but will instead focus on the need for progress on the EU-UK withdrawal agreement, and on the broad outlines of a future trade deal.

“We are not negotiating the white paper,” one senior EU official said. “We are negotiating the withdrawal agreement and we are negotiating a political declaration on future relationship with the UK.”

They added: “We are really happy that we have the white paper on the table and we have something we can work with. But it is not more than that. It is not the Ten Commandments.”

The official said there would be a lot of questions on the white paper, which was “detailed but still unclear to a certain extent”.

The EU has been deliberately low-key in its response to the white paper, wary of destabilising Theresa May’s fragile hold on power.

Stressing the unpredictability of British politics, the senior EU official said they might as well “read the entrails of animals” to know what is happening.

“The situation in London is very volatile and I think no one can tell what will happen with the political situation in the UK now. That is why we try to be very calm and prudent not to pour oil into the fire.”