Britain has left the EU single market – here’s what will change
In a historic first, former EU member state Britain has left the bloc’s single market and customs union after the expiration of the 11-month transition period. Four-and-half years after the referendum in Britain, Brexit is finally reality.
It took months of intense negotiations, but Britain and the European Union eventually agreed on a 1,246-page Trade and Cooperation Agreement (TCA), applied provisionally as of Friday.
Here is what the deal means for whom:
British travelers won’t need a visa for any trips up to 90 days in an EU country within any given 180-day period. Longer trips require a visa application.
According to the British government, EU citizens can spend up to six months in the country without a visa – provided they do not do paid or unpaid work for a British company. However, to marry in Britain or to register a civil partnership, a specific marriage visa is necessary.
If travelling with pets, British citizens might have to clear more hurdles, as EU pet passports will no longer be valid for them.
The European Health Insurance Card (EHIC) will remain valid until the individual expiry dates, and tourists will continue to be covered under similar conditions as before for now. A different scheme should eventually replace EHICs.
Freedom of movement is ending. Britain plans to set up a points-based system for migrants that favours those with qualifications or skills it considers relevant, akin to that of Australia. It will be up to each EU state to decide which Brits it grants work or residency permits and on what basis.
3) Students and researchers
Britain opted to not partake in the European Union’s student exchange programme Erasmus plus, claiming it was too costly. The country said it would set up its own version, facilitating exchanges worldwide, though exact details have yet to be announced.
London will, however, remain part of the EU research programme Horizon.
The two sides agreed on an unprecedented zero quotas, zero tariffs scheme for goods that comply with so-called rules of origin. These ensure that products are actually made or finalized in the exporting country, to stop third nations outside a trade deal selling wares through the back door of one signatory to another.
This means more paperwork for companies to establish and prove the “economic nationality” of their exports, particularly for products with complicated supply chains. Some may even have to review how they operate in order to meet thresholds.
There will also be new customs declarations to fill out and additional checks at borders, all of this likely slowing freight. Some goods like waste or hazardous chemicals will require export or import licenses.
On the EU side, border checks will start from 1 January, while the British government has said it will wait six months.
Even within the United Kingdom, there will be much more bureaucracy at the Irish sea border between Britain and Northern Ireland – notably on animal products – after a short grace period.
Northern Ireland is to remain compliant with EU customs rules as part of a deal to avoid a hard border on the island of Ireland. Experts fear this additional red tape could push up food prices and even drive some British businesses out of Northern Ireland.
While the zero-tariffs agreement on goods is a coup for both sides, there are notable omissions in the TCA on services – by far the largest part of the British economy at 80%.
For example, Britain’s key finance sector is losing its EU passporting rights, which allow businesses to trade without additional regulatory clearance. British finance firms must await a number of important equivalency decisions in the EU in the coming months.
There is also no agreement in the TCA on mutual recognition of professional titles, such as diplomas or other qualifications. British architects or lawyers wishing to provide services, for instance, will have to follow individual EU member states’ rules, which vary greatly. EU professionals will have to apply for recognition with British authorities.
Britain will have only limited cooperation with Europol and Eurojust, the EU policing and justice cooperation organizations, cutting back information flows. Both sides can request information on passenger name records (PNRs).
London also loses access to the important Second Schengen Information System. This database on border information was used 600 million times annually by British officials, according to the think tank UK in a Changing Europe.
The two sides will continue to swap DNA, vehicle registration and fingerprint information relevant for criminal investigations. There will also be new arrangements to replace European Arrest Warrants.
A transition period should keep data flowing between the EU and Britain for now, such as personal data collected by businesses. London has said it will it continue sharing data with the EU. The European Commission is due to take the relevant adequacy decision – on whether it recognizes British standards as allowing for free exchange – soon.
From January 1, a transition period kicks off running until June 2026. During this time, a 25% share of the EU’s current fishing quota transfers to British industries. Afterwards, annual negotiations will begin between the EU and Britain.