• Natural Gas News

    UK Enacts EU Withdrawal Bill


The terms for trade between the UK and the European Union member states have been agreed hours before the end of the UK transition period.

by: William Powell

Posted in:

Natural Gas & LNG News, Europe, Top Stories, Premium, Corporate, Political, News By Country, EU, United Kingdom

UK Enacts EU Withdrawal Bill

The UK formally ratified the agreement to withdraw from the European Union in the early hours of December 31, less than 24 hours before the transition period ends at 2300 GMT that day. Although a deal between the two trading partners had been expected, there was hard bargaining at the eleventh hour, before both sides claimed provisional victory December 24. The vote was pushed through the two houses of parliament who gave it barely any scrutiny, as the deadline zoomed ever nearer. 

UK prime minister Boris Johnson said the deal had proved his critics wrong: they had said that it was not possible to retain sovereignty and to have a free-trade agreement with the EU without tariffs and quotas. He said it was the first such agreement ever reached with the EU. UK-EU trade is valued at around $900bn/yr.

However there will be more paperwork and other forms of time-consuming administration for businesses. Other aspects of everyday life, such as travel to the EU, will also become more complicated for UK citizens. UK fisheries said they had been betrayed, and the deal does not protect services, prompting Labour Party leader Keir Starmer to label the agreement "thin and flawed". However he conceded that it was nevertheless better than no deal, which was, given the time available, the only other choice. The House of Commons vote was a convincing majority, with 521 for and 73 against. 

Speaking December 24, von der Leyen said: “It was worth fighting for this deal because we now have a fair and balanced agreement with the UK, which will protect our European interests, ensure fair competition, and provide much needed predictability for our fishing communities. Finally, we can leave Brexit behind us and look to the future. Europe is now moving on.”

In its latest ten-year network development plan, published before the agreement was reached, British gas and power transmission system operator National Grid said it would engage with the UK government and energy regulator Ofgem to understand the impact of the UK’s exit from the EU on the implementation of future EU energy market requirements. It engages on "gas policy matters at a European level within the European Network for Transmission System Operators for Gas, Gas Infrastructure Europe and with other EU stakeholders. "We will work closely with the Department of Business, Energy and Industrial Strategy (BEIS) and Ofgem to consider the gas aspects of the new EU legislative package as part of its Green Deal," it said.

Traders, producers welcome deal

The European Federation of Energy Traders (Efet) provisionally welcomed the deal, saying before parliament voted that it was confident that "trading of power and gas between Great Britain and continental Europe will continue smoothly from January 1, notwithstanding the need for customs declarations and changes in day ahead auction procedures. We support the emphasis that the energy chapter of the agreement places on principles for the operation of energy markets."

The UK upstream industry group OGUK has also welcomed the deal, saying it has "consistently stated that a deal would be the best outcome for our industry. We therefore welcome the agreement and thank both the UK and EU for their efforts in securing this trade deal. We continue to work through the details with our members, the government, and the broader business community to ensure that every opportunity is taken to minimise and manage any potential disruption to goods and services in the energy sector, as well as limiting inefficiencies and red tape as changes are implemented."