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EEA and UK agree on trade after December

23.11.2020 - 15:17
epa06896641 Anti Brexit campaigners fly EU flags outside the British Houses of Parliament in London, Britain, 18 July 2018. Reports state that British Prime Minister Theresa May said that Brexit 'must be workable' during a meeting with the Liason Committee. The Prime Minister is under pressure from both her Tory Party members and Labour Party MP's over Brexit.  EPA-EFE/ANDY RAIN
 Mynd: EPA-EFE - EPA
A temporary trade agreement has been signed between Iceland, Norway, Liechtenstein, and the UK. The deal lasts from 1st January, when the Brexit transition period ends, until a formal free trade agreement is signed between the countries.

The contract ensures the British will have the same access to the three EEA countries as they do today. No new tariffs will be applied to goods traded between the countries from 31st December.

According to Iselin Nybø, Norway’s trade and industry minister, the contract is an important step towards ensuring free trade between the countries continues while negotiations for a free-trade agreement are ongoing. The Norwegian authorities’ goal is to maintain ties so that companies that deal with the UK will face as little disruption from Brexit as possible.  

It is expected that the contract will be signed by ministers in mid-December. It was signed by officials from the countries’ governments last week. It is mostly based on the previous contract signed between the UK and Norway last April, which was set to go into effect in the event of a no-deal Brexit following the controversial referendum in 2016. 

Trade between the four countries still falls under the rules of the EEA and the new deal will be similar. The three European Economic Area states of Iceland, Norway, and Liechtenstein are not members of the European Union but do have almost equal membership of its Single Market and subscribe to its Four Freedoms. 

Nybø hopes for the best from the new contract and the trade deal that will follow, but is still preparing her country for disruption. A free-trade agreement will never fully be able to replicate the EEA’s trade status with the UK as an EU member state, no matter how comprehensive it is, a statement from the Norwegian government says. Companies therefore need to prepare for at least some taxes and tariffs on goods and services. 

The contract is seen as a stopgap and work proceeds on a full free-trade agreement between the EEA and the UK. Nybø says the final deal will be as advantageous to EEA companies as possible. The main EEA negotiator with the UK is Norwegian. The UK is Norway’s biggest trading partner after the EU. 

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Alexander Elliott
Project manager