Richard North, 25/08/2017  
 


I've written two recent posts which touch on data protection and Brexit - here and here - enough to tell us that the issue is extremely complex. And, as HMG seems to indicate in its latest partnership paper, this one on "The exchange and protection of personal data", there is a lot more to it than simple regulatory conformity.

For there to be a free flow of data with the EU and its Member States, a "third country" must approach the European Commission and get from it formal recognition that it provides an "adequate" level of data protection, equivalent to that provided by Member States under EU law.

Granting "adequacy" status is not automatic and, if it wishes, the Commission can make a series of assessments to determine whether the nature of that country's data protection rules and the means for ensuring their effective supervision and enforcement, are sufficient.

Also, as the partnership paper informs us, there is no set timeframe for the adequacy decision process. Even with everything in order, it could take several years, post Brexit, for the Commission to make a decision, which then needs to be confirmed by a panel of representatives from EU Member States.

Furthermore, as Politico points out, there are potential areas of conflict which may mean that the EU is reluctant to afford the UK full privileges on data sharing.

Nonetheless, HMG seems to think it will get an easy ride and, so confident is it on this issue that it is even asking for a high level of regulatory cooperation, with the UK's Information Commissioner's Office continuing to have an input in the framing and implementation of EU law. Once again, therefore, we see our government it is back in "having its cake and eating it" territory.

Most of all though, the government is assuming that that the EU will agree a new "deep and special partnership", without in any way having set out the detail of what that would entail, or even having got to the point where it is on the agenda and the EU is prepared to discuss it.

But, with the government having singularly failed to address the phase one issues, the current batch of "position papers" looks increasingly like a distraction, precisely to keep attention away from that failure.

It doesn't need Politico, therefore, to remind us that top EU officials are "increasingly doubtful" that Brexit talks will move on to their second phase of discussing trade in October. We could work that one out for ourselves.

To get the talks back on track, however, we have the entertaining prospect of the Commission delivering what might be termed a "short, sharp shock". That, according to Andrew Duff, may be what is needed to make UK negotiators focus on the issues at hand, instead of launching increasingly esoteric lists of aspirations into the stratosphere.

That, of course, assumes that the UK is actually prepared to entertain sensible negotiations and isn't simply looking for excuses to pull out of the talks, or that it thinks the "colleagues" will cave in at the eleventh hour and give us everything we want.

However, if Tom Newton Dunn of The Sun is to be believed, Davis is playing a more devious game. He is expected to go on the attack next week in an attempt to demonstrate that Barnier is being "stubborn and unreasonable", in a bid to peel away his support in the Member States.

The thing about Newton Dunn is that he has never been ill-disposed to inventing the occasional news story when it suited him. Nevertheless, the idea here is that Davis, in producing his flood of position papers, can claim to have been "very reasonable and offered up a huge amount of potential solutions to bridge the gaps". On that basis, by engineering a "public showdown", the Member States can be prevailed upon to issue Barnier with a fresh negotiating mandate.

Such a tale might even challenge Newton Dunn's inventive capabilities and it is just mad enough to be true. But I suspect that, if Davis thinks he can undermine Barnier and appeal directly to the Member States, then he has once again misread the situation. There is every indication that the EU side is rock solid.

Thus, if that is what passes for a UK negotiating strategy, we are riding for a fall and must expect our negotiators to come back from Brussels empty-handed. One wonders how long it will take for the majority to realise how desperately inept Mr Davis is, and how many will actually care.

Certainly, we should expect those businesses which depend on trade with EU Member States to be the first to raise the alarm. So far, though, the CBI, which should be in the forefront, has been noticeably quiescent.

Responding to the fantasy proposals on trade continuity, it issued a press release saying that, "The UK Government's position on goods is a significant improvement upon the EU's current proposal, whose narrow definition would create a severe cliff-edge hitting consumers on both sides of the Channel".

Illustrating a total lack of grasp of the issues, it then went on to say: "… the only way to provide companies with the reassurance they need is through the urgent agreement of interim arrangements. This would ensure that goods and services can still flow freely giving companies the certainty they need to invest".

To the CBI, the "simplest way" to achieve an interim agreement was "to stay in the single market and a customs union until a comprehensive new deal is in force". Both sides, it said, "should agree to move talks on to interim arrangements as soon as possible to stem the loss of investment".

Interestingly, the CBI uses the vehicle construction industry as its example for the impact of the EU not recognising existing product approvals. At present, it says, every new model of car, motorbike, bus and lorry made in the UK has to go through stringent testing by the Bristol-based Vehicle Certification Agency before it can be sold.

Vehicles must undergo type approval under Directive 2007/46/EC and, if a manufacturer elected for EC type approval, vehicles may be sold throughout the EU.

But the CBI then tells us that, "under the EU's proposals, a UK-made car put on the market for sale on 29th March 2019 would still be able to be sold in the EU the next day as its approval would still be valid. However, a car from the same production line, which had gone through the exact same process and secured the exact same approval, but was put in the market for sale on 30th March 2019 would not legally be allowed to be sold in the EU".

There are several troubling aspects to this assertion. Firstly, any scenario arising from the UK's departure from the EU will not arise as a result of an EU "proposal" but as a result of the change of status of the UK from Member State to "third country". The EU is not making any proposals, as such, that approvals will necessarily cease to be valid. The fate of such approvals depends entirely on the wording of specific legislation.

In the case of medicines, the approvals come in the form of "market authorisations" and the law states that the holders of authorisations have to be "established" in the Union. Thus, on Brexit, approvals held by UK manufacturers will no longer be valid, as their holders will not be established in the Union.

In the case of vehicle type approval, though, there is no requirement for a manufacturer to be established in the Union. Foreign (i.e., third country) manufacturers can and do apply for approval under EU law, which they can do in any one of the Member States.

And, as far as I can ascertain, once the approvals are issued, they remain valid until or unless there is a material change to the specification or such a nature that re-testing is required for the approval to remain valid. UK car companies will not, as the CBI asserts, have to secure "licenses" from EU approval agencies for all models currently in production.

Either way, the status of any approvals will not rest on any "proposal" made by the UK government but will depend on the exact meaning of the relevant EU law, in force at the time the UK leaves the EU.

The biggest change for the UK will be that the UK will no longer be able to issue EU type approvals, and UK manufacturers will have to seek now approvals from a country still in the EU. To that effect, they will be required to appoint representatives established in the Union to represent them before the approval authority.

If bodies such as the CBI are getting things so fundamentally wrong, though, it is not surprising that they are not pressing the panic buttons. But if our premier industry representative body can't get it right (and its manufacturing members are not correcting it), what hope can there be that the activities of Mr Davis are being properly monitored and the implications understood?

This is not so much the blind leading the blind and leading a blind man down a hole. In the picture, The "dog" is the CBI, the "man" is industry and the "hole" is Brexit. They will never know what hit them until they fall.






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