The government is dropping controversial plans to break international law in relation to Brexit, following a behind-the-scenes deal between the UK and the EU, it has announced.
In what could be seen as another olive branch to the EU, it said it would abandon all the Brexit clauses relating to Northern Ireland in the internal market and finance legislative bills.
The government U-turn comes in exchange for promises by the EU to minimise checks on controls imposed on food and medicines going into Northern Ireland from Great Britain after Brexit.
Details on the checks have yet to be disclosed, but in a joint statement from cabinet minister Michael Gove and the European commission vice-president, Maroš Šefčovič, they said they had sealed an agreement “specifically for checks on animals, plants and derived products, export declarations, the supply of medicines, the supply of chilled meats, and other food products to supermarkets”.
They have also agreed on which goods will be exempt from state aid rules, what goods are “not at risk” of being smuggled across the border into the Republic of Ireland and the final make-up of an arbitration panel to adjudicate on any future Brexit disputes.
“In view of these mutually agreed solutions, the UK will withdraw clauses 44, 45 and 47 of the UK internal market bill, and not introduce any similar provisions in the taxation bill,” said the joint statement.
Ireland’s foreign affairs minister, Simon Coveney, described it as a “positive development” that came after “significant and productive engagement between the EU and the UK”.
The news was greeted with relief by business leaders in Northern Ireland, who were told on Monday there would be “no grace period” on the implementation of the protocol.
Aodhán Connolly, director of the Northern Ireland Retail Consortium, described the move as “very welcome” and “hugely positive”.
He is one of several business and farming leaders who have called for the Northern Ireland protocol to be delayed because businesses have not enough notice to prepare for the remaining customs and regulatory checks that will still apply from 1 January.
“We still need the conclusion of a free trade agreement to remove customs frictions and with three weeks left to go we still will need an implementation period to allow us to comply with the new requirements. While this is a positive step there is still much to do in little time,” he said.
The deal comes after the Food and Drink Federation chief, Ian Wright, told MPs that the Northern Ireland protocol was “a shambles” with the threat of checks prompting four out of 10 food suppliers to pause or reduce the supply of produce to the region after Brexit.
The deal was finalised in Brussels on Monday during a meeting between Gove and Šefčovič, who jointly chair the UK-EU committee charged with implementing the Brexit deal signed in January.
A government source said: “Maroš Šefčovič and his team were constructive and pragmatic. We are pleased that we have reached agreement in principle on a package to apply in all circumstances that will protect Northern Ireland’s place in the UK’s customs territory, uphold the peace process and give certainty to people and businesses in Northern Ireland.”
Under the deal the two sides have also agreed “the exemption of agricultural and fish subsidies from state aid rules” along with the finalisation of the list of chairpersons of the arbitration panel for the dispute settlement mechanism in the event of errors and omissions under the protocol, which becomes operational on 1 January.
And completing their work, have finalised the “practical arrangements” on determining which goods were considered “not at risk” of crossing the border into the Republic of Ireland and therefore potentially liable to tariffs.
This had created much political tension over the summer with the UK fearing the EU wanted to impose potential tariffs and checks on all goods entering Northern Ireland.
That culminated in Boris Johnson’w claim in September the EU was threatening a “food blockade” down the Irish sea and therefore the Brexit clauses in the internal market bill were a necessary “safety net” against the risk of Northern Ireland being cut off from British food supplies.
The removal of the Brexit clauses clears the path of any further domestic legislative threats to a trade deal.
Serious differences remain, with Boris Johnson warning securing a deal at an imminent summit with European commission president Ursula von der Leyen would be “very difficult”.
The introduction of the Brexit clauses initially poisoned relations between the UK and the EU and led to infringement proceedings being launched by Brussels on the grounds they would break the terms of the international treaty.
Katy Hayward, professor of political sociology at Queen’s University, welcomed the move but added that the deal needed to be signed off by all member states.