With just seven months to go until the Protocol on Ireland/Northern Ireland becomes operational, time is running out – Lords EU Committee

In its report on The Protocol on Ireland/Northern Ireland, published today, the Lords Committee says that the Government's Command Paper on the Protocol, published on 20 May, failed to provide the clarity that Northern Ireland needs. It has called on the Government and the EU to address the concerns of business in Northern Ireland that onerous customs processes on goods moving from Great Britain to Northern Ireland risk causing significant economic damage in Northern Ireland. It has warned that uncertainty, lack of momentum and lack of time, compounded by the shock of the COVID-19 pandemic, pose a “potent threat to economic prosperity and political stability in Northern Ireland.”

The report also exposes the tension at the heart of the Protocol, between its commitments in Article 4, which states that Northern Ireland is part of the customs territory of the UK, and Article 6, on ‘unfettered' access for Northern Ireland goods to the UK internal market, and the application, in Article 5, of the entirety of the EU's customs legislation to Northern Ireland. The effect of Article 5 is to preserve a single regulatory zone for goods in the island of Ireland, thereby achieving the key aim of avoiding the imposition of a ‘hard border'. But the Government has yet to spell out what the significant new customs checks and regulatory processes on goods moving from Great Britain to Northern Ireland will mean for businesses and transport providers. 

The report calls on both the Government and the EU, through the Withdrawal Agreement Joint Committee, which will oversee implementation of the Protocol, to take a proportionate approach and to take full account of the specific needs of Northern Ireland, including its reliance on fast and efficient supply chains both with the rest of the UK and with Ireland. It also calls on the Government to clarify urgently how its proposal that NI businesses should not be required to complete exit summary declarations on goods can be squared with avoiding Northern Ireland becoming a back door for goods moving from the EU to the UK. 

Other major issues raised in the report include: 

• The potential for the provisions on State aid to impinge upon the UK's independent state subsidy policy
• The complex new VAT and excise provisions, which require the application of EU rules to the supply of goods, and UK rules to the movement of services.
• The potential for the democratic consent mechanism for the Northern Ireland Assembly to lead to economic uncertainty and political instability every four or eight years

Commenting on the report, Lord Kinnoull, Chair of the House of Lords EU Committee, said: 

“It is seven months to the day until the Protocol on Ireland/Northern Ireland becomes operational. But we still don't know what the Protocol will mean in practice for businesses based in or trading with Northern Ireland. 

“Two weeks ago, the Government published a Command Paper to explain its approach to the Protocol. But while it addresses the right areas, it's almost all in the future tense. Northern Ireland needs practical action now, not jam tomorrow.

“Time is now extremely short. My Committee warned back in 2016 of the danger of Northern Ireland becoming collateral damage of Brexit. The Government and the EU now urgently need to work together to provide clear guidance and a proportionate approach to the application of the Protocol. Failure on either side would threaten Northern Ireland's prosperity and stability.”