Post Brexit UK- European Union: What will change from January 2021?
Why in News?
Now after 4 years of voting, Brexit is finally happening. Know what changes are to be seen after Brexit is implemented, from January 1, 2021.
About Brexit
The UK had voted to leave the EU in 2016 and officially left the trading bloc which was its biggest trading partner on 31 January 2020. But, both sides agreed to keep many things the same until the end of the year to allow enough time for agreeing to the terms of a new trade deal.
This was a complex, sometimes bitter negotiation, but they finally agreed on a deal on 24 December.
Brexit means:
Free trade: Trade between the two countries, where neither side charges taxes or duties on goods crossing borders.
Level playing field: A set of rules to ensure that one country, or group of countries, doesn't have an unfair advantage over another in areas such as workers' rights and environmental standards.
Tariff: A tax or duty to be paid on goods crossing borders would be imposed.
Transition Period: Was provided for 11 months
Countries in the European Union:
The EU countries are namely- Austria, Belgium, Bulgaria, Croatia, Republic of Cyprus, Czech Republic, Denmark, Estonia, Finland, France, Germany, Greece, Hungary, Ireland, Italy, Latvia, Lithuania, Luxembourg, Malta, Netherlands, Poland, Portugal, Romania, Slovakia, Slovenia, Spain and Sweden.
Brexit: Changes after January 1, 2021
- The deal has new rules for UK and EU's work and trade together. Some points are listed below.
- Till the time the UK was a part of the EU, companies were allowed to buy and sell goods across EU borders without paying taxes. There was also no limit on the quantity which could be traded. This won't change on 1 January, but to be sure that neither side has an unfair advantage, both sides had to agree to some shared rules and standards on workers' rights, as well as many social and environmental regulations.
- Freedom to work and live between the UK and the EU would be ended and in 2021, various UK nationals would be needing a visa if they wished to spend more than 90 days in 180 days in EU.
- Northern Ireland shall continue to follow many of the EU's rules. This has been done to avoid hardening of its border with the Republic of Ireland.
- This means new checks would be introduced on goods entering Northern Ireland from around the UK.
- The UK is free to set its trade policy and can negotiate and sign its deals with other countries.
- Also, talks are being held with the US, Australia and New Zealand that didn't have free trade deals with the EU.
- There may not be new taxes to pay at the border, but there will be new paperwork, and the potential for it to cause delays is a serious concern.
Major changes from January 2021 in a box
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Way Forward
Decisions are still pending on data sharing, financial services and agreement on fishing (lasts five years only).
Also, while the UK and EU have agreed to some identical rules, they may not remain the same in the future. It is also said that in case no one side takes exception to the changes, a dispute could be triggered, which could ultimately lead to tariffs on various goods. So this means the topic could never see peace.
