The June Deadline For Brexit Extension Has Passed - But The UK Could Still Buy More Time
11th July 2020
From The institute for Government web site by Georgina Wright.
Many businesses are worried they will not be ready for a new trading relationship with the EU on 1 January 2021. There are ways to secure more time later in the year - but they cannot be negotiated last-minute, says Georgina Wright.
By passing up the opportunity to extend by the 30 June deadline, the government has kept the UK on course to leave the transition period by the end of the year. It has instead opted to intensify talks, with the prime minister saying he wants the outline of a deal agreed by the end of July. The EU has mooted 31 October as a more realistic deadline for the end of negotiations, but that would leave just two months for businesses to prepare for the practical changes - from the swathe of new customs procedures to the new regulatory border down the Irish Sea.
It is increasingly clear that UK and EU won't have everything in place to trade under the terms of a deal, if one can be reached, and businesses still do not know the scale of the preparations they need to undertake for 1 January 2021. The GB-EU border will not be ready, with the government acknowledging as much when it set out its new plans to avoid full checks on EU goods entering the UK for the first six months of next year and Liz Truss, the international trade secretary, reportedly expressing her concerns when she wrote to Michael Gove and Rishi Sunak this week. On top of this, the coronavirus outbreak has caused yet more uncertainty.
The government is firmly set against any extension now, but it may find that it needs more time after a deal has been reached.
The government has not lost its only opportunity to secure more time
The current transition was originally named an "implementation period" by former prime minister Theresa May. It was intended to last 21 months, giving time to negotiate a new treaty and to adapt to the new trading relationship once the Article 50 period had ended. The revised Withdrawal Agreement allowed only 11 months for negotiation, ratification and implementation. Though the deadline to extend the transition period has passed, our latest research shows that it may be possible for the UK and the EU to secure more preparation time in the form of a real implementation phase later in the year.
Read more HERE