Based on the draft Withdrawal Agreement, it has become clear that the UK and EU intend to maintain, in effect, regulatory alignment in environmental protection during the transition period, with indication that the requirement for very close alignment of regulation following the transition period will need to be maintained as a core component of any future agreement. This should be closely monitored during the transition period, in light of the continued insistence in some parts of the political spectrum that very close regulatory alignment with the EU will prevent the UK from entering into independent trade deals with other nations.
The reference to environmental protection regulation in the Political Declaration appears quite circumspect at first glance – the only explicit reference to the ‘environment’ being the statement that: “The future relationship must ensure open and fair competition. Provisions to ensure this should cover….environmental standards….building on the level playing field arrangements provided for in the Withdrawal Agreement” (emphasis added). The reference to the level playing field is potentially significant as regards environmental protections.
Our assumption is that the relevant ‘level playing field arrangements’ are those contained within the Protocol on the ‘Northern Irish backstop’ in the draft Withdrawal Agreement, in which both the UK and the EU commit to a non-regression pact requiring them to maintain common standards in environmental protection at the level in place at the end of the transition period. This would cover areas such as waste management, environmental impact assessments, nature and biodiversity conservation, chemical regulation and industrial emissions, and including the ‘precautionary principle’ (which some within industry had been encouraging the UK to move away from). The precautionary principle is enshrined in Article 191 of the TFEU as a tenet of EU law. It aims to ensure a higher level of environmental protection through preventative decision-taking in the case of risk (even where not fully established scientifically).
This non-regression pact, stated to be necessary for the ‘proper functioning’ of a market where goods can flow freely, is evidence of the EU’s desire to export its own environmental standards, and prevent the UK from creating a looser regulatory framework for businesses than in the EU.
If the UK and EU intend to build upon this non-regression pact in any future EU/UK trade deal, this could hinder the UK’s prospects of concluding trade deals with other territories, such as the US. To take one high profile example: arguably, the acceptance of US rules permitting the sale of chlorinated chickens within the UK in a future UK/US trade deal would be a regression from the EU standards (and as such disrupt the level playing field).
The non-regression environmental protections envisioned are stronger than those included in a traditional free trade agreement, although there will be significant grey areas, for instance the UK has scope, as long as it can justify it achieves the same outcome, moving from emission limits to tradeable permits or opting to no longer link the UK to the EU Emissions Trading Scheme, simply to implement a system of carbon pricing of at least the same effectiveness and scope. Ultimately, these kinds of differences allow the UK to take a different procedural approach to environmental issues, which the EU may argue do not amount to an equivalent level of protection.