Brexit: Brussels turmoil

30/01/2021

Within hours of it having been published, the draft implementing regulation was taken down. The action leaves an orphaned press release, a speech by Valdis Dombrovskis and forlorn questions and answers sheet, explaining a measure that no-one can see, because it has since been withdrawn.

Technically, we're talking about a "transparency and authorisation mechanism for exports of COVID-19 vaccines", which one pundit is describing as "a self-harming game in potentially restricting vaccine exports to the UK as a tit for tat for the inability of AstraZeneca to supply the 80 million doses it ordered by the end of March".

No one has come out – so far – and called it an outright export ban, but "potentially" is a loaded word. Under certain, very limited conditions, the implementing regulation (as was) could have empowered the Commission to "authorise" exports to third countries of vaccines covered by an Advance Purchase Agreement (APA) with the EU. By withholding authorisation, it could effectively ban exports, on a case-by-case basis.

The measure actually relies on Regulation (EU) 2015/479, and in particular Article 5, which allows the Commission to take "protective measures" to prevent "a critical situation from arising on account of a shortage of essential products, or to remedy such a situation".

Giving the measure extra teeth is Article 5(3), which allows measures to be limited to exports to certain countries, and there is little doubt as to which particular country the Commission has in mind. Hence, the measure is not a blanket export ban – it would be specifically targeted.

But what has hit the "outrage" button is the EU's decision to invoke Article 16 of the Irish Protocol. This allows either the EU or the UK - in the event that the application of the instrument leads to "serious economic, societal or environmental difficulties that are liable to persist, or to diversion of trade" – unilaterally to take "appropriate safeguard measures".

Pete has already given this the once over on the blog: the Commission is proposing to use the Article to restrict vaccine exports to Northern Ireland, thus preventing the province from becoming a back door into Great Britain, in the event that vaccine supplies were to be limited.

On the face of it, this was a logical measure, although politically controversial, giving Brexiteers a free "hit", reinforcing long-standing prejudices and allowing the Commission to be painted as a blood-sucking killer of babies and destroyer of worlds – or something not very far from that.

With it not even in place, though, DUP leader Arlene Foster was quick off the mark, condemned the move as an "incredible act of hostility" that places a "hard border" between Northern Ireland and the Irish Republic.

"By triggering Article 16 in this manner", she said, "the European Union has once again shown it is prepared to use Northern Ireland when it suits their interests but in the most despicable manner - over the provision of a vaccine which is designed to save lives".

Playing the victim card for all it was worth, Foster went on to condemn the Commission for behaving in "the most despicable manner - over the provision of a vaccine which is designed to save lives". This was despite the fact that Northern Ireland is being supplied with vaccine from England, and no deliveries from EU sources were expected.

Even the Irish government was lacking in enthusiasm, with a senior adviser suggesting that the move looked like a diplomatic misstep, especially when Ireland did not manufacture and export COVID-19 vaccines.

"We understand the theory behind the decision, but we're struggling to see the practical need for this step," the advisor said. "The EU seems to be bolting the barn door when there’s no horse to bolt".

As of now, the Commission is said by the Irish Times to be redrafting the measure and a new version is expected this morning. But the Commission will have to move very fast indeed, as the regulation is expected to come into force on 31 January.

If it had still intended to invoke Article 16 of the Irish Protocol, the Commission would have needed to take special care as it would allow the UK to take "proportionate rebalancing measures", which are "strictly necessary" to remedy any imbalance – although there is an inbuilt delay of one month – unless "exceptional circumstances" apply - and the Commission is only applying its measures for six weeks – the period permitted by the regulation.

However, it has now been conformed that the EU is not intending to invoke the Protocol safeguards, in what is being described as a humiliating U-turn. "Should transits of vaccines and active substances towards third countries be abused to circumvent the effects of the authorisation system", the Commission says, "the EU will consider using all the instruments at its disposal".

Behind the scenes, there have been "constructive talks" between von der Leyen and prime minister Johnson, when it was agreed in principle "that there should not be restrictions on the export of vaccines by companies where they are fulfilling contractual responsibilities".

Upon that, of course, rests the interpretation of what "contractual responsibilities" have been incurred by the players, and in particular AstraZeneca.

Relations have been soured by an as-yet unresolved dispute after the Commission contracted to buy up to 400 million doses of the AstraZeneca vaccine. Now the firm has experienced problems at one of its EU factories, it is reducing supplies to EU member states by about 60 percent in the first quarter of 2021.

Yet the EU has failed to make a breakthrough in crisis talks with AstraZeneca and is looking flat-footed and inflexible, with even Barnier wanting Brussels to step back.

After its relatively sure-footed performance during the Brexit and trade negotiations, the Commission seems determined to snatch a humiliating defeat from the jaws of its previous – albeit modest – victory. By common accord, Brussels seems to be in turmoil on this issue and even its friends seem to recognise that it is losing the public relations war.

By contrast, with the UK significantly ahead in the vaccination stakes, Johnson for once is having a "good war", while many former "remainers" are being driven reluctantly into the Brexit camp. One can only admire the skill with which the Commission has managed to convert a winning position into a train-wreck in such short a space of time.

Also published on Turbulent Times.