Post-Brexit Deal Reached: Hooray For The Fish

Fish were the final stumbling block in a post-Brexit deal between the EU and UK. The sides reached a Christmas Eve compromise.

Fish, the Final Stumbling block

The Financial Times reports Britain and EU Poised to Announce Christmas Eve Brexit Deal.

Fish remained the final stumbling block yet the total amount of harvested fish amounts to only €650 million ($790 million) annually.

Christmas Eve Announcement Expected 

Bloomberg reports U.K., EU Set to Announce Brexit Trade Deal After Compromise.

One EU diplomat said the U.K. had made concessions on fisheries in recent hours that had unlocked the deal. According to two people familiar with the matter, Johnson has accepted that the bloc’s share of the catch in U.K. waters should fall by 25% over a period of five-and-a-half years. Britain had initially sought an 80% reduction over just three years, but in recent days had offered a cut of 30%.

The bloc had refused to accept a reduction of more than 25% in the value of fish caught, saying even that was hard for countries like France and Denmark to accept, according to officials with knowledge of the discussions.

This would be phased in over five and a half years. The U.K. previously offered three years while the EU were pushing for 10.

The EU also wants to be able to impose tariffs on the U.K. if, after the fisheries transition period, the government restricts access to its waters. In its latest compromise offer, the U.K. said it would accept tariffs on fisheries but not in other areas, such as on energy, as demanded by the bloc.

Fish Are Cheering

The fish are cheering. The EU will catch 25% less of them phased in over 5.5 years.

Hooray!

Unfair Competition

The other major stumbling block was a huge dispute over alleged "unfair competition".

There is no word yet on how that was solved but I expect Johnson did not sell the farm. By that I mean the UK will not be at the mercy of the European Court of Justice. 

There will of course be some other arbitration mechanism. As long as Johnson avoided the ECJ trap, the deal will be very minimal but also fair.

Win-Win Setup

The deal also includes tariff-free electric car manufacturing. 

That component seems to benefit the UK the most, as the deal allows parts to come from outside EU.

In the final analysis, all trade deals are a win-win setup. If they aren't perceived that way, there is no deal.

Rush is On 

Johnson will have to hold an emergency session of Parliament and the EU will have to bend some rules as there is no time for it to vote this year. 

This final outcome was easily predictable as was the length of time it took to reach it. 

As I said way back in January, then again in June, October, and November: Everything in the EU happens at the last minute if not much later.