Brussels wants to hit UK with tariffs if it shuts EU fishermen out of British waters after Brexit

Michel Barnier spoke in the European Parliament in Brussels this morning. He said talks were at the "moment of truth".  - EPA
Michel Barnier spoke in the European Parliament in Brussels this morning. He said talks were at the “moment of truth”. – EPA

Michel Barnier doubled down on Brussels’ demand that fishing rights be linked to trade in the Brexit deal on Friday and warned the UK and EU were at the “moment of truth” in the negotiations. 

Brussels wants the power to freeze British companies, and especially the fishing industry, out of the Brexit trade deal and the Single Market, if EU fishermen are shut out of UK waters in the future.

The EU’s chief negotiator said it was “unacceptable” that Britain could cut off access to UK waters but keep the benefits of the trade deal with the bloc. He said that would not be “fair” or “honest”.

Mr Barnier said, “The European Union also has to maintain its sovereign right to react or to compensate by adjusting the conditions for products, and especially fisheries products, to the Single Market.” 

“And that is where we come up against one of the main hurdles of the negotiations at the moment – fisheries being part and parcel of the economic partnership,” he said in the European Parliament in Brussels.

London has always rejected calls to link fisheries to trade because of the risk of retaliation, for example in the form of tariffs or suspension of market access, across the two agreements.

But Mr Barnier’s mention of “particularly” fisheries products could hint to a possible future compromise where tariffs retaliating to a loss of access to UK waters would be ringfenced to only hit fishing.

The UK has leverage in the fisheries negotiations because EU fishermen are dependent on access to British waters. But that advantage would be lost if it was tied to the trade deal, where the EU has the upper hand by virtue of its larger market. 

Most fish landed in Britain is exported. About 75 percent of exports including herring, cond, shellfish, mackerel and salmon, goes to the EU market. The shellfish industry is totally dependent on the EU market and would be badly hit by tariffs. 

Both sides agree on the need for a transition period to bring in the new fishing arrangements, which gives EU fishermen time to adapt and the UK time to build up its fleet but are divided over the length and how it will work.

The EU has offered the UK an eight year transition period after an earlier demand for a 10 year period, which was rejected. 

Britain has offered Brussels a three year glidepath, if the EU hands back 50 percent of the value of the fish caught in UK waters. The EU wants just 22 percent of the value of fish of the quota returned to Britain immediately. 

Mr Barnier said he would be continuing negotiations with Lord Frost, the UK’s chief negotiator, for a “last attempt to reach an acceptable agreement, acceptable in terms of fisheries.”

“It’s the moment of truth. We have very little time remaining, just a few hours to work through these negotiations in a useful fashion if we want this agreement to enter into force on the first of January,” Mr Barnier told MEPs. 

“There is a chance of getting an agreement but the path to such an agreement is very narrow.”

The European Parliament has set a deadline of Sunday to have the text of the finalised Brexit trade deal or it will refuse to ratify the agreement before the end of year no deal deadline. 

Boris Johnson last night told the president of the European Commission a deal could be done if Brussels gave ground on fisheries and on its demand that EU-level funding be exempt from subsidy rules in the level playing field agreement. 

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