29 May 2022

The Never-Ending Struggle Over (Northern) Ireland

The UK Threatens to Breach the Ireland/Northern Ireland Protocol Again

Claiming the need to “protect the Belfast/Good Friday Agreement in all its dimensions”, the UK government threatens once again to adopt legislation unilaterally changing the Protocol Ireland/Northern Ireland (NI-IRL-P). In legal terms, this would constitute a breach of the Withdrawal Agreement between the EU and the UK. There is an element of repetition: English Conservative politicians attempt to outdo each other in refusing to be bound by agreements with the EU on principle and use Northern Ireland as an exercise field for this. But does the Good Friday Agreement (GFA) indeed exclude divergence between Northern Ireland (NI) and Great Britain (GB) or even demand protecting trade from GB to NI? What specific vulnerabilities of Ireland require a continued EU response?

Perpetuated hybridity: Is divergence between Northern Ireland and Great Britain banned?

Divergence between Northern Ireland and Great Britain is quite common, with or without “Brexit”. For example, Northern Irish universities receive less funding per student than those in Great Britain; funding caps for Northern Ireland’s National Health Service result in people waiting 100 times longer for surgery than in England, triggering a constitutional challenge last week; anti-discrimination law in GB is more developed than in NI; differences in publicity of funding for political parties constituted the basis for the DUP to receive considerable sums from undisclosed sources in order to distribute leaflets promoting “Brexit” in England. However, none of these divergences has ever been challenged with reference to the GFA, neither politically nor legally.

Instead, the NI-IRL-P is called out as violating the GFA by allegedly undermining its East West Dimension. This is the base for legal challenge by Jim Alister and other Unionists, rejected in April by the Northern Ireland Court of Appeal, and now pending before the UK Supreme Court, as well as for the legislative package announced by the UK Secretary of State for Foreign Affairs, Elisabeth (Liz) Truss, which aims to “cement the provisions in the NI-IRL-P that are working, including the common travel area, the single electricity market and north-south co-operation, while fixing those elements that are not, such as the movement of goods, goods regulation, VAT, subsidy control and governance”.

The GFA ended the armed conflict over Northern Ireland being British or Irish. To achieve this, Ireland gave up the claim to Northern Ireland, and the UK its claim to the whole of Ireland, while Northern Ireland remained part of the UK until a referendum of its people would decide for it to change allegiance. As a typical peace agreement, the GFA is phrased to allow divergent interpretations: Unionists construe it as perpetuating Northern Ireland’s status as a UK province, which is their favoured option. Nationalists, who prefer a united Ireland, read the obligation to conduct a referendum as an option to achieve their aim peacefully. In order to avoid clashes of those positions in everyday politics, the GFA demands for Northern Ireland to be governed with “full impartiality”, endowing Unionists and Nationalists with more political power than any other political faction: the nationalist and unionist party with the most members (MLAs) in the Legislative Assembly (the Northern Irish Parliament sitting in Stormont) nominate the first minister and the deputy first minister, who in a common office constitute Northern Ireland’s head of government. Thus, the Unionist DUP, with 25 MLAs after the April 2022 elections, can block instituting the NI government, although or because Sinn Féin, now 27 MLAs, would nominate the first minister, while the neutral Alliance Party (now 17 MLAs) could never overcome that blockade, even if they were to win more MLAs than the DUP. This adds another motive for the UK government to defer to the DUP position that the NI-IRL-P must be dismantled.

Next to the political governance structures, the GFA can be read as constituting hybridity of Northern Ireland, as argued in more detail elsewhere (p 376-8): the “people of Northern Ireland” (i.e. those born in Northern Ireland to a parent with right of residence) can identify as either British or Irish or both. The territory can change allegiance to become Irish and to become British again after a vote. That hybridity, recently also recognised by Boris Johnson, suggests that the GFA induces divergence between Northern Ireland and GB, instead of prohibiting it.

The Good Friday Agreement and the Internal Market

The NI-IRL-P provisions specifically disputed ensure that Northern Ireland is part of two internal markets – the UK internal market (Article 4 and 6) and the EU Internal Market only for goods (Articles 5, 7-8, with extensive annexes), which for the sake of the integrity of the EU Internal Market also requires inclusion in the EU’s VAT and State Aid regime (Articles 9, 10 with annexes), and the EU’s legal enforcement mechanisms as well (Article 12 (4). These provisions, if fully implemented, require some controls of goods being imported into Northern Ireland from Great Britain, and allow the EU Commission to raise infringement procedures against the UK in case of non-compliance. The UK could have established controls at British ports, avoiding foreseeable tensions in areas with a strong unionist orientation such as around the port of Larne, where “riots” emerged in April 2021. Though arguably fuelled by wider socio-economic insecurities of unionist communities, these were the pretext for the UK to drop most controls of goods entering Northern Ireland, partially with EU consensus and partially without. So does the GFA require to renege on the UK’s obligations to establish controls?

Maintaining Northern Ireland in the EU Internal Market for goods was motivated by avoiding the establishment of border controls on the island of Ireland, since these would bring back memories of their abuse for excessive controls and intimidation. Yet, the GFA also aims to overcome socio-economic disadvantage in Northern Ireland overall, and for the section of its population traditionally excluded specifically. Enhancing socio-economic development of an entity as small as Northern Ireland can be best achieved by integrating it into a larger socio-economic entity. EU membership of both the UK and Ireland allowed that integration of Northern Ireland through its participation in the EU internal market. This is reflected in the clause of the International Agreement between the UK and Ireland concluded to implement the GFA on developing “still further the unique relationship between their peoples and the close cooperation between their countries (….) as partners in the European Union” – a commitment betrayed by “Brexit”. From this perspective, the NI-IRL-P should be perceived as a means to achieve some inclusion of Northern Ireland in the EU Internal Market, which can be seen as reducing the betrayal of the GFA through Brexit. Yet, the dominant perception differs from this. It is the focus on the land border, also underlined in paragraph 21 of the NICA ruling in Allister. That focus contributed to coining slogans rejecting a “sea border”, used in Unionist rallies.

The UK’s reluctance to implement the NI-IRL-P has some simple economic rationale too: Article 4 NI-IRL-P ensures “unfettered access” to the British market for Northern Irish products, but not vice versa, provoking the accusation of endangering the UK Internal Market, introduced as recently as 2020. Removing GB from the EU Internal Market and Customs’ Union through “hard Brexit” while retaining Northern Ireland therein does create differences within the UK: Applying the Customs’ code involves controls, which unfortunately are not yet fully electronical. This may well reduce the “trade deficit” which Northern Ireland had with Great Britain up to 2020.

Trade diversion in favour of Northern Ireland would arguably support the GFA’s goal to improve its socio-economic status, while Liz Truss legislative plans would stabilise GB’s trade surplus with one of the poorest regions in the UK. The proposals also aim to replace the supervision by the EU Commission and the Court of Justice with a trusted trader scheme only subject to domestic control, while also scrapping the ban on state aid disturbing competition in the EU Internal Market for Northern Ireland. In short, the UK wants access to the EU Internal Market for goods through Northern Ireland, without being subject to the same controls and restrictions Member States have committed to for that access.

Are protections of the EU Internal Market really necessary?

There is some noise in social media suggesting that the EU is making a fuss about nothing, since the impact of uncontrolled influx of goods into Northern Ireland would only minimally affect the EU internal market. These suggestions seem counterfactual: On 23 May the Irish Times reports a “redirection of Northern Irish traffic from ports in the Republic to Belfast, Larne and Warrenpoint”, representing a 12 % increase of trade through NI ports where goods are not controlled for EU compatibility, to the detriment of Irish ports, where those controls are implemented. In parallel, the volume of freight travelling on direct routes from Ireland to other EU countries increased, as did the movement of goods from Northern Ireland to GB and potentially onwards to the EU. According to Stuart Anderson of the NI Chamber of Commerce, “exports [from Northern Ireland] to RoI [Ireland] are up 34 %”. In a dynamic region, this volume is set to increase. At the same time, the UK is starting to relax standards, lately paving the way for genetically modified tomatoes.

Economic opportunities of accessing two internal markets are perceived by Northern Irish business, but also elsewhere: A recent increase of company registrations in Northern Ireland includes a number of production sites by non-UK businesses registered at residential addresses. NISRA finds that Northern Ireland’s economy has the highest annual growth rates in the UK for 2021, among others based on goods accessing the EU Internal Market without most of the controls required by the NI-IRL-P. Altogether, this indicates that there is a real need to protect the EU internal market from substandard goods as well as from other malpractices, while not sacrificing Northern Ireland’s gains through the NI-IRL-P. To this end, the EU has issued a package of non-papers aiming to reduce controls of goods destined for consumption in Northern Ireland in October 2021, and in 2022 unilaterally reduced safety standards for importing medicines to ease operation of NHS NI.

Irish perspectives on avoiding a “trade war”

If the UK rejects any negotiation of these EU’s proposals and continues to refuse implementing the NI-IRL-P, the EU is likely to use its powers under the general part of the Withdrawal Agreement, which – if arbitration fails – allows imposing tariffs and withholding other advantages. In parallel, the EU commission can issue infringement proceedings Court of Justice under Article 12 (4) NI-IRL-P, potentially resulting in penalty payments for the UK.

When Irish politicians warn of the consequences of such an EU / UK trade war, their concerns include the expected necessity to establish border controls on the island, as well as hindrances for plans of developing an all-island dimension of trade in services and attracting foreign direct investment. Additionally, lingering economic dependence from the UK and geographic realities cause specific vulnerabilities for Ireland resulting from British insistence on the loosest possible relationship with the EU enabling the creation of a low-regulation economic area in the EU’s new Western neighbourhood.

Geography matters, as it separates the island of Ireland from the EU Internal Market, while remaining full aligned in regulatory terms. The rapid increase of direct transport links from Irish ports to Continental Europe only highlights how few of those existed before “Brexit”. Also, Ireland still depends on the UK electricity grid. From 2016, projects have been devised and EU funding acquired to connect it to the French electricity grid – but due to technical complexities this will only be completed in 2026. It is thus not without irony that Liz Truss praises the common electricity grid of Northern Ireland, Ireland, and GB as a positive element of the NI-IRL-P. These realities will require continuing EU support for Ireland specifically, to enable a more rapid liberation from these dependencies, if the risk of diverging interests between the EU and its outermost Western member state should be avoided.