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Comment by breakfastduck | Hacker News Reader

That's a very Europe centric view, though.

It essentially makes compliance to EU law optional for companies operating in the UK. That's a huge advantage. Choose to trade on EU terms with the single market, or choose to trade on other terms with different international targets.

That may not be precisely what you want, but it's not a bad deal for the UK, it's just a different set of terms.

Plus, the EU will do better without us. We've always just complained and delayed their desire for further deep integration between countries.

To paraphrase Boris' quote of 'Having a successful, independent UK over the channel isn't a bad thing for the EU', well neither is it bad for the UK to have an independent EU to trade with, where they can crack on with what they want to do without us disrupting it.

Edit: people seem to be taking this as me 'selling' brexit. Just wanted to discuss the situation, at least it kicked off a chat!

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> It essentially makes compliance to EU law optional for companies operating in the UK. That's a huge advantage. Choose to trade on EU terms with the single market, or choose to trade on other terms with international targets.

When the UK was in the EU, it was never a requirement for goods sold to non-EU countries to meet EU regulations. On that front, nothing has changed: selling to EU, you need to meet EU laws; selling elsewhere you need to meet theirs.

Yes - but now we can trade with those countries on our terms, not an aggregated decision on how we can trade set by EU legislation. Before we wouldn't need to meet single market standard to trade with those countries, but the overall terms would depend on EU trade deals or standard rules.

This is why leaving the customs union is key to any reasonable Brexit deal.

I'm not even trying to argue that Brexit is good necessarily, but more rationalizing why the deal always had to be what it is. Anything else other than staying in the EU isn't a beneficial option for the UK - unless joining EFTA, or similar.

> Yes - but now we can trade with those countries on our terms, not an aggregated decision on how we can trade set by EU legislation.

No, we trade with those countries on the terms of our trade agreements with those countries, which will more or less be the higher of each partners' standards on each involved aspect (unless there is no trade agreement at all, then it's WTO terms which are the same the EU would get).

The only realistic difference to trade policy being out of the EU is that we can lower our standards with respect to the EU when negotiating deals with third countries. The EU already had some of the highest standards in the world for workers rights, food safety and animal welfare and safety, and I don't think we'll be selflessly rising above those any time soon.

I think parent means that those terms would be negotiated by UK with only UK interests at heart, and not submerged in other countries interests.

Yep, preceiely what I was getting at. Our deals with other countries now can, at least, be specialized deals in our own trading interest.

What does that mean in practice?

I get that you can save some pages in a trade agreement that would otherwise be dedicated to protecting Spanish oranges (insert any other good produced in EU but not in Britain here) but those pages were never of consequence to Britain anyway.

> and I don't think we'll be selflessly rising above those any time soon.

The UK has expressed continued interest in raising animal standards beyond those enforced by the EU - the PM even mentioned it in his speech as an example where the UK will go further in regulation.

The PM also said the NHS would be getting an extra £350m a week as a result of a Brexit dividend.

Some people believed that too - although rather fewer believe it now.

In most cases, UK standards exceed EU standards. Nobody is interested in a race to the bottom.

That certainly was so in many areas, less so as they synchronised more over time (many EU standards born out of originating UK ones). But definitely an opportunity to raise standards.

Now - how that works if say the UK raises a standard and the impact upon EU imports. For example the EU regulations for `carper dust sucker` was questioned by Dyson for being flawed. Now if the UK does it's own standards that have to be followed for `carpet dust sucker` to be sold in the UK that exceeds EU standards then that could be interesting.

So the prospect of a trade war via standards used to limit external competition and sudo subsidise companies in that cunning way - could be something we could well see down the line. That equally could work both ways.

Which all makes how this trade agreement is worded in need of scrutiny as rules to protect one way, will also word both ways in such agreements to lock-in standards. Now if they refer to just EU standards as a base and no reference to equally protection to UK standards or whatever is the higher. Small details like that could have some interesting ramifications later on.

One thing is for sure - we are still a long way off from a standard global shoe size that is used by all. Which say's little and lots about trade and standards country to country.

When you sell to any country you sell on their terms. When they sell to your country, they sell on your terms. You always have to meet their regulations unless you are so more powerful that you can twist their arm and do as you wish.

Yeah, exactly.

Now the UK can trade with those countries on its own terms rather than involving the EU.

That's a pretty big difference, and countries DO want to trade with the huge UK market.

Then why are no countries or businesses queuing up to take advantage of the commercial opportunities that have become available?

> Yes - but now we can trade with those countries on our terms…

Er no, we get to trade with them on their terms, having just lost the benefits of any preferential terms negotiated by the EU. Those “overall terms depending on EU trade deals” were overwhelmingly favourable terms negotiated thanks to the immense negotiating power of the whole EU trade bloc. We’ve now lost almost all of that.

And bear in mind a lot of these EU trade deals weren’t forced on us, we played a leading role in negotiating those deals ourselves. Now we’ve lost the benefit of a lot of that hard work.

Fortunately we have negotiated maintaining trade access with some countries, including Canada and Japan under our former EU arrangements. On many other cases though I believe including India, no such luck so far.

Agree that's the situation in the short term, but there's no avoiding that. We can go on to negotiate and agree our own deals with those countries ourselves in the long term.

They will be different agreements, obviously - while they may be lesser overall they can at least be more targeted to our specific interests rather than a whole bloc, which may yield some advantages for the UK.

Again, not trying to say this is necessarily better than staying in, but it does have its own advantages as well as compromises.

It has severe disadvantages right now and for the near future, but might possibly lead to some benefits if we’re lucky eventually if you squint right.

You’re not selling me on it.

Not trying to, just rationalizing why the deals been set. I think it's actually a pretty fair compromise from both sides - doesn't necessarily mean it's better than being in though!

Which countries? What major untapped markets are in need of what the UK exports but don't already have it? About 60% of our exports are services, particularly financial and insurance and we just lost passporting rights to the EU on those. The EU is not perfect but we've fucked off out of it without planning or preparing what to do next. I mean the deal that we'll be trading under in 7 days time has only just been agreed and isn't even ratified.

Again, it's not that we don't have access to those other markets in the EU, it's that the terms are set by the EU as a bloc.

Now, it'll be up to the UK to negotiate the specific terms with those markets, while being able to access free trade with the single market.

Absolutely agree it's absurd that the deal comes so late with basically 0 time to really prepare, but negotiations between blocs, countries and even small domestic businesses always go right down to the wire, just a human thing.

None of which answers the question - which significant new markets exist for UK goods and services?

Unless you count tax evasion and money laundering - something the UK was doing okay at already - there simply aren't any.

There is no promised land here, no sunlit uplands, no glorious future as an independent trading nation. In reality the UK has just pulled the rug out from under its most productive service sector and cut out the heart of its tax base.

And it doesn't have the skills or the culture to develop new service markets, because it's thinking like a 19th century imperial power running a 19th century economy, not like an interconnected smaller power with significant unique skills and talents in a mixed 21st century economy.

When you sell a plane or a computer or a tractor to a foreign country you don't just sell an item that needs to be shipped. You also sell training, spares, continuing support, consultancy. and business development.

These were relatively friction-free when freedom of movement was a thing. Now they're much harder, because they rely on employees visiting customers and possibly staying with them for long periods - which can't be done with paperwork and restrictions.

This "deal" makes all of this much harder for EU trade, and does nothing at all to make it easier in Rest of World.

And all of this held up for weeks by arguments about fish, which are barely a rounding error in GDP terms.

There’s a long list of major economies that don’t have free trade deals with the EU, such as the United States, China, India and Australia.

Why would the US sign a free trade deal with the UK, when it wouldn't sign one with the much larger EU? I fully expect my government to insist on conditions favorable towards the much larger and much richer party in UK-US trade relations.

Because before the EU can sign off on a trade agreement, it needs to be unanimously accepted by every member state, which takes an absolute ton of time. The CETA deal with Canada was held up solely by a region of Belgium at one point.

It's a lot easier to get a trade deal with the UK, where you're only dealing with one government with a much more specific set of interests.

Source: https://www.bbc.co.uk/news/world-europe-37749236

They were right imo, ceta was a big mistake.

Unfortunately this kind of resistance always caves to internal pressure. Similar to the resistance to software patents by Poland.

Because a free trade deal between the US and UK would be mutually beneficial.

Talks have been ongoing for some time now, and I would expect a deal to materialize in the coming years.

Free Trade agreement with China sounds like a potentially ruinous idea for British industry?

We’ve always just struck trade agreements with these countries until now. E.g. we export petrol and medicines to China and import electrical gizmos.

An FTA with the EU and the US (in that order) could make sense though.

Australia’s a perfect trading partner in a lot of ways but it’s just too far away in a world that cares about reducing carbon footprints.

> Australia’s a perfect trading partner in a lot of ways but it’s just too far away in a world that cares about reducing carbon footprints.

On one hand, yeah. But on the other hand, an article floating around in the last few weeks pointed out that modern container shipping is really cost effective these days.

Apparently container ships have also been looking at modern/environment friendly approaches for a while now too (including big wind kites(?) I think). So, that's somewhat likely to further improve over time as well.

Whatever the technology it’s going to be even more effective if you can find a cluster of 27 relativey rich countries nearer to sell to.

Yeah, good point. :)

Except now we're a small economy and one that's shown itself willing to break international laws we'd only just signed up to. Not something most trading partners are looking for.

There was never an ambition to diverge on day one. But as the COVID vaccine authorisation and rollout has shown, the UK is (somewhat) free to choose to do things which will influence the EU (in this example via the German press) to the mutual benefit of everyone. Sometimes 'solidarity' can prevent anyone from setting a good example.

Agreed.

What the deal does provide is a different relationship. It's absolutely not just 'being defacto in the EU'.

How you take that depends on your own political opinion, but it's certainly not the same as before!

We always had the right under EU law to make emergency authorisations for medicines. How is that related to Brexit?

There is a right to ask permission for emergency authorisation in the EU. It was not given, and still probably wouldn't have been given if the UK hadn't rolled out the vaccine.

Section 174 of the Human Medicines Regulations disagrees with you https://www.legislation.gov.uk/uksi/2012/1916/regulation/174...

This is simply untrue, and spreading such misinformation has been the hallmark of lying right-wing politicians in the UK - Farage, Rees-Mogg, François etc.

A direct quote from The Financial Times [1]:

"Was the UK able to do this [provide emergency authorisation for the Pfizer vaccine] because of Brexit?

No."

Sources:

[1]: The Financial Times - https://www.ft.com/content/021720c2-157e-40b4-b2f9-33515032f...

[2]: UK legislation - https://www.legislation.gov.uk/uksi/2012/1916/contents/made

Nope customs Union would have been fine, as it would have compromised between those that want the best for the economy and those that are more concerned about immigration.

Those talking about “sovereignty” as if there is such a thing as sovereign vs non-sovereign nations are a minority of Brexit voters and did not need to be pandered to. Unfortunately they made up a good proportion of the ruling class.

Importantly though the UK does not need to apply those rules and standards to domestic trade (which is over 90% of it).

Yeah, plenty of UK businesses whose only customers are UK residents may see benefit.

Only time will tell, depends hugely on how the UK decides to differ in it's regulations.

Brits will soom be able to eat imported chlorinated chicken!

The only reason to do that is price, which importing (from the USA, presumably) would surely negate. When chlorinated chicken has been brought up as a debate point it's as an example of a standard that might slip, that cheaper UK chicken might be chlorinated for a UK market.

I doubt it would be popular, personally.

I’ve never been able to get a straight answer to the obvious question - which rules?

I always wanted a good solid answer to that so i could ask what stopped us changing them from within the EU but i never got past the first hurdle.

Usually means labels, safety, privacy, worker rights, quotas, etc. The EU has a vast amount of regulations that protect consummers but make business harder/more expensive. The UK should retain most of those independently, will probably fudge some of them.

Vat directive, bio fuels directive and directives concerning tendering.

>> VAT Directive

The EU rule is minimum 15%, the UK choses 20% of its own accord.

But that's not the interesting bit, the interesting bit is the follow-up question: "what stops the UK changing this from within the EU?"

The answer for this one is nothing - in fact, EU states have already agreed that all states will have full VAT setting powers from 2022.

>> biofuels directive

You'd need to give more context here - Boris Johnson has committed £12 billion partly in support of going beyond the requirements of this directive as part of the so called "new green revolution".

What exactly is the conflict with the biofuels directive? If anything it's weaker than the current UK Gov's expressed desires in this space?

>> directives concerning tendering

Yep - this is a bona fide one.

Thank you for the information on the VAT directive changing in 2022. Is that the definitive VAT system? I've not really been following EU legislation for the last few years.

The thing that concerns me with the biofuels directive is it's requirement for 5% of petrol to be made up of biofuel. As the cheapest source of this is palm oil, we then end up contributing to the destruction of habitats in Indonesia in order to grow palm oil to burn in our cars. The EU does recognise this and I'm sure I read that come 2030, that will be disallowed, but then they will likely need to use Soy or some other oil that will cause even more destruction.

I don't have any sources for this to hand and I may well have some of this information incorrect. It's been about five years since I researched much of this.

Is that true? When the UK was part of the EU, goods manufactured in the UK would have to comply with UK laws, which would have to be equivalent to or stronger than the EU laws.

Only if they were being sold in the UK, because the UK had trading standards which complied with EU trading standards.

So if you’re lowering the bar, you’re doing it for the UK primarily. But our trading standards were higher then the EU base ones. So, not sure what we gain.

But yes, if you produce goods not destined for the UK market, it was completely fine for you not to meet EU standards.

You're missing the point. It's not just the standards with internationals, its the terms of trade. That's what you win back.

You can directly negotiate and agree terms with any other country freely without consulting the EU, where before the terms were set by the EU.

Yes. And the EU negotiated with other countries on our behalf - with unbelievable bargaining power as the world’s premier trading block.

Now we’re a country of 70 million in a world of 7 billion trying to negotiate within a world dominated by bigger and more powerful nations and trading blocks.

We went from a big player in the biggest block to a medium player all alone.

True.

But as a huge player, the EU also had to make more generic deals, for lack of a better term. It had to be beneficial for all EU countries.

As a smaller player, the UK can be more specialized and agile in its trade deals. Is that better than being in the EU? Only time will tell.

Well in this generic deal the UK has lost Financial Passporting rights to the EU. RIP London as an economic hub of European trade.

Sure, you get more freedom to negotiate your own terms, at the cost of being a significantly smaller player. So you lose some leverage and gain some elsewhere.

It's really to early to tell how this will shake out, but it's obviously as silly to assume either that in general UK will be able negotiate better deals on its own than as part of the EU, or that it won't be able to negotiate any good deals.

And that's the real stuff.

You gain some you lose some, on both sides.

We have no idea really how it will play out, depends hugely on how the UK govt acts in the next few years.

One thing I think that is telling is that I heard the UK government has characterized this as a "Canada like" agreement (e.g. NAFTA).

I think there is some deeper truth in this. UK is setting itself up to be in a very similar role, i.e. Canada::USA -> UK::EU.

When you are the junior partner in a tightly coupled trade partnership, you have a lot of nominal freedom in practice you are going to steered by the larger player, both intentionally and not.

Who was it that said, "When America sneezes, Canada gets a cold"? I think that was originally a european saying, so we've come full circle.

I'm not sure people in the UK have really come to terms with this, yet. There is no plausible return path to, say, pre-war UK on the world stage. There might be room for another Canada though.

When people refer to a “Canada” style trade deal in the context of Brexit, they are referring to the free trade deal between Canada and the EU.

https://en.m.wikipedia.org/wiki/Comprehensive_Economic_and_T...

Ah, thanks obviously I missed that context.

I think my general point stands.

That's an entirely different point, not any point missed by the comment you're replying to.

What connects the two points is that they hold similar appeal in theory, and are entirely meaningless in practice. The UK has signed a number of trade agreements already, and none of them contain meaningful differences to the EU agreements the UK was previously part of.

“It essentially makes compliance to EU law optional for companies operating in the UK.”

As long as they do not export to the EU or do not sell half-products to firms that export to the EU.

Most exports from UK companies go to the EU, and will have to comply with EU regulations.

For those firms also exporting to non-EU countries, chances are it won’t be worth the hassle to make both EU-compliant and non-compliant products (as an example, look how the RoHS (https://en.wikipedia.org/wiki/Restriction_of_Hazardous_Subst...) drove the world to ban lead in soldering)

Playing devils advocate it's very easy for a company to set up two shells or 'partner' organizations where the products are targeted to different markets.

Easy (you don’t even need multiple companies), but it would double your overhead and means you’ll have to keep more supplies (if you run out of EU-regulation foobars, you can’t grab a few non-EU-regulation ones) or order them in smaller quantities (⇒ quite possibly at higher prices), have larger stores of stuff to be sold, etc.

That wasn’t even worth it for global electronics companies to keep producing non-RoHS-compliant electronics, and quite a few of them produce at scales that few others do.

It's about production lines, the cost to manufacture the same thing to different standards is more costly (generally) than just producing one thing to the highest standard and selling it to both markets.

Get that, but means companies can operate different 'arms' for different operations. Products can be totally different, they don't have to be 'variants' of the same item.

If they are different products for different markets they could already do that.

Putting the self-sacrificial, better without us bullshit aside (the sheer arrogance of which in itself is nonsense because the UK had a huge influence in making the EU what is today), the view is europe centric because we are geologically and historically European, and the UK has just given away the incredible influence it had in the world's largest trading bloc, the one that has brought about the longest period of peace within the continent.

Whatever you and others might believe, don't try and spin Brexit as an act of nobility designed to protect the EU from the all-powerful, magnanimous British empire of yore. This agreement, and the past four years, has been an incredible loss and have set the UK back by a good 40 years. We have been in the throes of populism for half a decade and are only digging deeper into it.

I'm not trying to explain my beliefs or spin anything, I'm just highlighting what are clearly the aims of the deal.

Thanks for doing this. You’re taking the time to write thoughtful explanatory answers and people are taking out their understandable bitterness on you

The aim of the deal was to get something better than what was previously had, at any cost. Any.

While I can appreciate an attempt at objective analysis of the deal, that's not what has been discussed so far. And, in all honesty, the occasion itself is momentous enough that it's a dis-service to discount any emotions around the affair.

This isn't a cause for celebration for a calculable majority of the UK, after all.

All over this thread you seem to mention potential trade benefits for the UK based on being separate from the EU. Can you name some benefits (perhaps let's say 3) that you expect will be negotiated more favourably for the UK within a year that the UK was unable to get as part of the EU.

Also ... being part of a a trade bloc always has benefits and positives, but the two key negatives touted as 'deal-breakers' in the Brexit negotiations have been related to (1) sovereignty and (2) concessions. A few weeks ago Peter Verovšek wrote a short but pretty good article on effectively the illusion of sovereignty (https://www.socialeurope.eu/brexit-and-the-misunderstanding-...) for the UK, and in terms of concessions it seems that a small nation with limited resources hardly makes a net loss by being part of a larger trade bloc: access to a huge market while exposing a small market of your own.

> We've always just complained and delayed their desire for further deep integration between countries.

Exactly that - we have as a country, never really embraced the whole EU direction and dare say that short stretch of water between Mainland Europe and the UK - has historically set a different cultural mindset. Equally the whole WW1+2 experiences would of also had some rippling legacy impact I dare say.

However you look at it, if you have a disruptive employee and they want to leave, wish them the best and both will be better of.

But certainly be interesting what reforms the EU will do in the comming years, certainly that whole area of reform was conceded by many including Donald Tusk right after the 2016 vote and as last stood, was being driven by Macron - though only once the UK has left. So be interesting how that progresses and how that manifests.

I think the "not a bad deal, just a different set of terms" is key. This isn't or shouldn't be about trying to get one over on the other side, the UK and the EU are not in a zero sum game, clearly levels of trade integration require harmonization of regulation, some countries are going to be happy with that in particular areas, some aren't, and to decline to integrate has economic consequences within that local context. And similarly just because the UK doesn't want to be part of the EU political union, that's not some calculated insult, it's just something we aren't happy to do. Not every partner of the EU needs to be part of the EU.

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