“So the Government has finally published Boris Johnson’s detailed proposals to deal with the vexed question of the Irish border, the fundamental issue which must be resolved if the UK is to leave the EU with a deal on 31 October, or possibly indeed if we are to leave on that date at all.
The coming days will reveal what politicians and the EU will make of the plans and what will emerge, but what would the proposals mean in practical terms? These would of course take effect at the end of a two year transition period.
It is suggested that Northern Ireland would leave the EU Customs Union, as of course would the rest of the UK, but remain within the EU single market for goods.
This distinction would mean that regulatory checks would not be imposed at the border on goods passing between Northern Ireland, and the rest of Ireland and indeed other parts of the EU. These will be regulated instead by means of checks at traders’ premises and “other designated locations”. Even more importantly it is crucial to the UK’s ability to make important progress in negotiating its own trade deals to replace those we are a party to as an EU member state.
The EU is fundamentally concerned not to prejudice the integrity of the single market and a large number of practicalities will have to be worked out around this if businesses are not to be landed with a huge administrative burden.
The single market is of course a different matter to the Customs Union and Northern Ireland would be integrated into the UK system for the purposes of VAT and customs duties. But again there would be no physical border checks, or at least not at physical points on the Ireland/Northern Ireland border. There must be concerns that this opens up potential for VAT avoidance. This has been acknowledged in the UK submission along with the need to “cooperate to minimise evasion” though details of how this will work are thin on the ground.
The workability of the proposals will depend heavily upon the extensive use of “trusted trader” arrangements which are already a feature of the current system and work well in practice, but a key concern is that these will have to be rolled put more extensively and will be open to potential abuse.
The coming days will see (and we are already seeing) a flurry of positioning statements from the EU, member states and the Irish government in particular. Much more important will be the nitty gritty discussions taking place behind the scenes which will determine whether this proposal is seen as workable all round and a means of saving some faces.”