The Unresolved Standoff: UK and EU’s Disagreements Leading to the Potential No Deal Brexit

The United Kingdom (UK) and the European Union (EU) are currently on the brink of a potential no deal Brexit due to unresolved disagreements. These conflicts range from minor issues, such as fishing rights, to major concerns, including the UK’s desire for continued access to the EU market without adhering to its regulatory framework.

Core Disagreements and Their Implications

The UK has long been campaigning for the status of a "Menu of Favours without Boundaries," meaning it wants to retain all the benefits of EU membership without having to comply with the EU's regulatory framework. This stance is a significant stumbling block in the ongoing negotiations, as the EU is pushing for strict border controls and the reinstatement of a hard border between Northern Ireland and the Republic of Ireland to prevent goods from bypassing customs checks.

The EU's insistence on these border controls is rooted in its desire to maintain economic security and stability. The UK's refusal to enact these measures has led to a renewed focus on finding a solution that could prevent a no deal scenario, which could disrupt trade and cause significant instability.

The Minor Disagreement: Fishing Rights

While the major issues include border controls and regulatory alignment, there are also minor disputes, such as fishing rights. The EU’s stance on this issue suggests a genuine concern over the UK’s ability to overfish and its potential impact on the European economy. Currently, EU countries hold a roughly 15-18% share of the catch, and they are generally unwilling to relinquish this share.

The UK, however, is willing to negotiate fishing zones and introduce greater flexibility in the future. Despite the importance of these discussions, they pale in comparison to the larger issues of regulatory alignment and market access. The fishing rights issue is likely to be kept in the table for negotiation purposes rather than as a core issue, given that fishing, including all satellite industries, accounts for only a 0.03% of the UK GDP.

The Major Stumbling Block: Post-Brexit Regulations and State Aid

The real sticking point in the negotiations is the post-Brexit regulatory framework. The UK wants to keep the current legislation, but it firmly opposes having to adopt future regulations without any say in their creation. The UK argues that this would severely hurt its interests and give the EU an unfair advantage by allowing full access to the internal market without respecting future regulatory changes.

The EU, on the other hand, is wary of the UK gaining an unfair advantage by accessing the internal market without having to follow potentially costly regulations. The absence of alignment could give the UK a competitive edge in the market, which is a significant concern for the EU.

A Complicating Factor: EU's Perspective

Complicating the issue further is the EU’s belief that it has already made significant concessions and that Brexit is "yesterday’s news." The UK has taken extensive preparatory steps and has calculated the costs of no deal. However, the focus is now on other pressing matters, such as the challenges posed by countries like Hungary and Poland.

The EU's concern over the potential for instability and future conflicts with the UK, particularly in the context of state aid, adds another layer of complexity. The UK’s ability to provide subsidies to industries without EU oversight poses a serious challenge to the EU’s internal market principles.

Conclusion: A Long Road Ahead

The UK and EU’s ongoing disagreements are far from resolved. The core issues of border controls, regulatory alignment, and state aid remain contentious. While fishing rights may be kept in the table for negotiation, the major hurdles are still to be overcome. As the deadline for a no deal Brexit approaches, the two sides must find a way to bridge their differences to avoid a disruptive outcome.