Brexit trade war warning: Every option EU has over Boris’ ‘deeply damaging’ bill

Brexit: Civil servant issues 'high risk' warning

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The Northern Ireland Protocol negotiated by the Government has created prolonged Brexit fallout with the EU, as ministers seek to prize the bloc’s grip from British trade. Boris Johnson and Foreign Secretary Liz Truss have proposed a bill that would override aspects of the trade agreement, but unilaterally. Britain reneging an agreement it made without express approval from its signatories would break international law, EU officials state, and warrant severe repercussions.

Could Boris Johnson’s Brexit bill cause an EU trade war?

Conservative and Unionist politicians, the Prime Minister and his party among them, have wanted to kill the Northern Ireland Protocol since soon after its application in 2021.

Mr Johnson’s Government has claimed the EU is not working with negotiators and has opted to move on with unilateral action, repealing aspects of the deal they believe hamper trade within the UK.

The bill – which ministers will reveal today – aims to abandon sections of the agreement that treat Northern Ireland as a separate entity from the rest of the UK, keeping it in the Single Market and under European Courts of Justice (ECJ) oversight.

The Prime Minister and Ms Truss have made the changes to satisfy the DUP, now the north’s minority party, to persuade it to form a power-sharing agreement with Sinn Fein.

They claim to be making them unilaterally in the interest of the Good Friday Agreement, which the protocol was created to protect.

Mr Johnson said today that the bill is the “right way forward” and a “bureaucratic change that needs to be made”, but bloc officials have disagreed.

EU feeling was summed up by Irish Taoiseach Micheál Martin, who, responding to the Prime Minister, said it was “pretty serious stuff” to announce a unilateral breach of an international agreement.

He added the bill would be “deeply damaging” to EU-UK relations and accused the Government of “proposing to set aside” international law.

Mr Martin has previously assured that the EU does not want a trade war with the UK, having said in May that one would be “shocking” and “unnecessary”.

The European Commission has not explicitly threatened to initiate a trade war but has threatened repercussions.

The commission’s Vice President Maroš Šefčovič said in late May that unilateral actions “are not acceptable” and vowed to respond.

In a statement, he said the EU would “respond with all measures at its disposal” if the UK decided to “move ahead with a bill disapplying constitutive elements of the protocol”.

A trade war with Britain would rank among those measures but likely wouldn’t be the bloc’s first stop.

An international disagreement on this scale would have to go through the courts first, and the EU would want to launch a new legal complaint, adding to several it already has with the Government’s handling of the protocol.

Unfortunately for the bloc, one of the clauses considered by the UK’s bill would withdraw ECJ oversight of the deal, weakening its judgements.

Before a fully-fledged trade war, the bloc may opt for a “gentler” approach and damage the UK’s participation in its most valuable projects.

The Government is involved in several potentially lucrative initiatives sparked by EU leaders, the multi-billion Horizon research programme among them.

EU goodwill may fade in negotiations across many of these, meaning the UK loses out in several areas financially before a trade war even commences.

A trade war, which is more likely to harm both the bloc and the UK, will be among last resort options, given costly repercussions and the red tape EU officials have to walk through to ignite one.

Like the EU, the Prime Minister doesn’t believe the bloc will opt for a trade war and dismissed the prospect while speaking with LBC.

Bloc officials and Mr Johnson have made near-identical statements about the prospect.

Mr Johnson said he didn’t believe the bloc would pursue a move like that, but if it did, it would be a “gross, gross overreaction”.

He added such a decision would be “perverse” and “preposterous”.

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