On December 24, 2020, the UK and the EU signed a trade and cooperation agreement (TCA) that would govern trading relationships between the two entities after the UK`s exit from the EU. This agreement has been the result of months of negotiations after Brexit, and it sets out the terms of trade for goods and services, investment, and other areas of cooperation that the UK and the EU will follow in the future.
One of the primary objectives of the TCA is to establish a level playing field for trade between the UK and the EU. This means that both parties will have to adhere to certain rules and regulations to ensure fair competition, such as environmental and labor standards. Additionally, the TCA has provisions to avoid the imposition of tariffs and quotas on goods traded between the two entities, which would have been detrimental to businesses and consumers on both sides.
Under the agreement, the UK has retained its sovereignty in terms of regulatory decisions, which allows it to set its own rules for goods traded within the country. However, the UK has agreed to maintain certain standards to ensure that it does not gain a competitive advantage through lower regulatory standards.
For services, the TCA allows for the provision of cross-border services between the UK and the EU, but it also recognizes that each party has the right to regulate its own service sector. This means that businesses providing services will need to comply with the rules and regulations of the country they are operating in.
One of the key benefits of the TCA is the mutual recognition of professional qualifications between the UK and the EU. This means that professionals such as doctors, lawyers, and architects can have their qualifications recognized in either jurisdiction, making it easier for them to work across borders.
In terms of fishing, the TCA has provisions for EU boats to continue fishing in UK waters, but with reduced access compared to what they had under the EU`s Common Fisheries Policy. The UK will also have the ability to manage its own fisheries, which was a key issue for many Brexit supporters.
Overall, the TCA between the UK and the EU is a significant achievement that provides a framework for trading relationships between the two entities for years to come. While it does not completely eliminate the regulatory divergence between the UK and the EU, it does provide a platform for cooperation and will hopefully lead to a prosperous future for both parties.