The EU’s European Commission and Council, by their failure to acknowledge and respond fairly to the United Kingdom’s ‘grandfather’ or accrued rights has, metaphorically, swung a wrecking ball at an orderly Brexit process. Instead, through the management of the negotiations (culminating in the unequal Withdrawal Agreement) they have imposed their perceived rights without practical reciprocation in the UK’s favour, particularly on facilitating existing frictionless trade. This is potentially threatening to the UK’s national interest and ultimately likely to be counter-productive to trade, amicable future relations between the UK and the EU, and to the European Superstate Project.
What are Grandfather or Accrued Rights?
Grandfather rights (also known as accrued rights) are often used to continue an existing arrangement when legal, regulatory or product conformity requirements change. Commonly, appropriate wording is added to new or amended laws, regulations or contracts. Thus an existing (now non-compliant) product is allowed although there may be restrictive conditions imposed such as a time limit for non-compliance or use in existing applications, schemes or projects only. Some further information about the concept of grandfather rights, with examples, is provided here.
The EU often makes practical use of grandfather rights to accommodate existing products (that would suddenly cease to be saleable within the Single Market or usable) and to provide transitional arrangements. Such transitional arrangements can exist for several years until it becomes economic to implement the mandatory changes. Some requirements may never be implemented and national variations are included to accommodate this situation.
The Application of Grandfather Rights to Brexit
Brexit represents a change of relationship between the EU and the UK; mainly to serve political aims. However, nobody’s interests are served by altering or disrupting existing frictionless trading and other close working relationships. Some application of grandfather rights would, therefore, be appropriate with EU laws, even temporarily, amended to suit, see e.g. this article: How Legal Fictions can avoid a no-deal Brexit.
However, the EU has chosen not to do this. Rather than accept that Brexit is a unique event, requiring a pragmatic, dedicated and flexible response, the EU has chosen to uncompromisingly treat the UK just as it would any ‘third’ country where it doesn’t have any close prior relationship giving rise to accrued rights for both parties.
As can be seen in the EU’s Brexit preparedness notices ( see for example for industrial products or Customs and Indirect Taxation) in the event of a no-deal there are no UK grandfather or accrued rights. It is effectively a lose-lose situation and any transitional arrangements are for the EU’s benefit only.
Naturally, some acceptance of UK grandfather rights by the EU would have resulted in a very different and potentially much more politically acceptable Withdrawal Agreement! Also, such flexibility by the EU would have helped facilitate a more positive approach to negotiations on the future relationship.
The treatment of Notified Bodies (Nobos) and mutual recognition of standards and conformity assessment show how uncompromisingly inflexible is the EU’s approach. Notified Bodies are independent accredited organisations that carry out mandatory third party conformity assessment of a wide range of products to enable them to be placed in the Single Market.
Currently UK based Nobos are accredited with relevant competences, and are listed on the EU’s NANDO database. After Brexit, these Nobos cease to be accredited, meaning that they cannot carry on work within the Single Market or the wider European Economic Area (EEA) or on goods or products destined for there. Yet non-EU Nobos based in Norway (an EEA member), Switzerland and Turkey (non-EEA members) are accredited.
The free circulation of non-harmonised goods or products, (where there are no EU Regulations setting common standards) within the Single Market relies on the ‘mutual recognition principle’. In this case goods or products that can be legally sold (and used) in the producing country can be sold (and used) in other Member States, without applying local standards or further conformity assessment.
After Brexit, mutual recognition of UK sourced goods or products ceases and local regulations in each Member State apply. After Brexit, additional local requirements or regulations can also apply to EU regulated goods or products from the UK. For further analysis of the implications see this article: Brexit: mutually assured distraction.
Perhaps the UK negotiators did try to protect the UK’s interests and get some grandfather rights accepted by the EU, even for an interim period. However, to do so requires the EU to be helpful, perhaps involving some quid pro quo, and the UK negotiators to have relevant industry knowledge of working with EU regulations and World Trade Organisation principles.
Reading between the lines of the official guidance produced by our Government and the European Commission, it appears that little or no consideration has been given to the disruption, extra bureaucracy and costs involved to business here or in the EU, especially in the short term. In effect the ‘bread and butter’ of using grandfather rights relating to goods and products has been ignored.
The EU’s Approach is inconsistent, illogical and potentially unlawful
A no-deal outcome from Brexit represents a major failure by the EU to address grandfather or accrued rights in respect of the UK. Their use of rights in the Withdrawal Agreement is highly selective, illogical and inconsistent. Consequently the UK has been placed in the invidious position of having accepted the EU’s demands (for example on accrued EU Citizen rights) whilst being denied reasonable grandfather rights to achieve them through a continuation of frictionless trade.
The EU has in effect created special obligations for the UK after Brexit whilst ignoring and abolishing existing accrued UK national rights. Ultimately a no-deal Brexit would potentially remove all grandfather rights. The EU’s actions violate their own laws, treaty obligations and rules, and are far from those to be expected towards a long-standing friendly neighbour.