Protocol on Ireland/Northern Ireland: Commission launches four new infringement proceedings against the UK – The European Sting – Critical News & Insights on European Politics, Economy, Foreign Affairs, Business & Technology

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The European Commission has today launched four new infringement procedures against the UK for failing to comply with significant parts of the Protocol on Ireland/Northern Ireland. They are in addition to the infringement procedures launched on June 15, 2022.

Despite repeated calls from the European Parliament, the 27 EU member states and the European Commission to implement the protocol, the UK government has failed to do so.

In a spirit of constructive cooperation, the Commission has refrained from launching certain infringement procedures for more than a year in order to create space to seek common solutions with the United Kingdom. However, the UK’s reluctance to engage in serious discussions since last February and the continued passage of the Northern Ireland Protocol Bill through the UK Parliament runs directly counter to this spirit.

The purpose of these infringement procedures is to ensure compliance with the protocol in a number of key areas. This compliance is essential for Northern Ireland to continue to benefit from its privileged access to the European Single Market and is necessary to protect the health, safety and security of EU citizens and the integrity of the Single Market.

More in detail

The Commission has decided to launch four new infringement procedures against the United Kingdom concerning Northern Ireland for, respectively:

  1. Do not comply with applicable customs requirements, surveillance requirements and risk controls on the movement of goods from Northern Ireland to Great Britain. This greatly increases the risk of smuggling through Northern Ireland. For example, it opens up the possibility for traders to circumvent EU rules on bans and restrictions on the export of goods to third countries or offers opportunities for carousel traffic of goods declared for export in the EU. EU and not leaving the customs territory via Northern Ireland. On December 17, 2020, the UK issued a unilateral declaration to ensure ‘unfettered access’ for Northern Irish goods to enter the UK market. The EU accepted the UK’s proposal to provide “equivalent” information by “alternative means” in real time. To date, however, the UK does not collect relevant export declaration data for goods moving from Northern Ireland to Britain. Nor does it provide any information to the EU on these movements, which makes it impossible for any monitoring of these goods by representatives of the Union.
  2. Failure to notify transposition of EU legislation laying down EU rules on excise duties, which will become applicable from 13 February 2023. Member States and the United Kingdom in respect of Northern Ireland were required to transpose this Directive and notify the Commission of their transposition measures by 31 December 2021. To date, the UK has not done so. . The non-application of these rules presents a budgetary risk for the EU (i.e. excise duties are not collected or are collected at a lower rate than the EU rate) in terms of relates to the movement of excise goods to/from Northern Ireland.
  3. Failure to notify transposition of EU rules on excise duties on alcohol and alcoholic beverages, which facilitate the access of small producers and artisans to reduced excise rates, among other provisions. Member States and the United Kingdom, with regard to Northern Ireland, were required to transpose this directive by 31 December 2021 at the latest. The non-application of these rules presents a budgetary risk for the EU (c i.e. excise duty is not levied or levied at a lower rate than the EU) with respect to excise duty payable on the movement of alcohol and beverages alcoholic beverages to/from Northern Ireland. Any deviation from harmonized EU excise duties would also distort competition in the supply of these goods within the single market.
  4. Do not implement EU Value Added Tax (VAT) rules for e-commerce i.e. import one stop shop (IOSS). The IOSS is a special regime that companies can use since July 1, 2021 to comply with their VAT obligations on distance sales of imported goods. It allows suppliers and electronic interfaces selling imported goods not exceeding €150 to buyers in the EU to declare and pay VAT via the tax authorities of a Member State instead of having to register in each State. member in which they sell. For EU consumers, this means much more transparency: when buying from an EU or third country seller or platform registered in the One Stop Shop, VAT is part of the price paid to the seller. To date, the UK in relation to Northern Ireland has not taken the necessary IT steps to implement the IOSS. This in turn poses a fiscal risk for the EU

Today’s decision marks the start of formal infringement proceedings, as provided for in Article 12(4) of the Protocol, in conjunction with Article 258 of the Treaty on the Functioning of the European Union. The letters sent to the UK ask its authorities to take prompt corrective action to restore compliance with the terms of the protocol. The UK has two months to respond to the letters, after which the Commission stands ready to take further action.

Background

The European Union wishes to maintain a positive and stable relationship with the United Kingdom. This relationship must be based on full compliance with the legally binding commitments that both parties have made to each other, based on the implementation of the Withdrawal Agreement and the Trade and cooperation. Both parties have negotiated, agreed and ratified these agreements.

After long and intense discussions between the EU and the UK, the protocol is the best solution found jointly to reconcile the challenges created by Brexit and by the type of Brexit chosen by the British government. The Protocol is an integral part of the Withdrawal Agreement. It avoids a hard border on the island of Ireland, protects the 1998 Good Friday (Belfast) Agreement in all its dimensions and guarantees the integrity of the EU’s single market.

The EU has been understanding of the practical difficulties of implementing the Protocol, demonstrating that solutions can be found within its framework.

Aurora J. William