Northern Ireland Protocol: What does the “Windsor Framework” mean for business?

What is the “Windsor Framework”?

The “Windsor Framework” set out the new arrangements for the Northern Ireland Protocol, designed to:

• restore the smooth flow of trade within the UK internal market,
• safeguard Northern Ireland’s place in the UK, and
• address the democratic deficit.

The three main changes are

1. New simplified arrangements for GB-NI trade:

• The introduction of a Green Lane for goods deemed “not at risk” of passing into the EU Single Market. Goods passing through this lane will not be subject to full EU Customs Code rules and instead a simplified set of commercial information can be used to move goods.
• Under the Windsor Framework it has been agreed that certain categories of parcel movements will automatically not be considered at risk of moving into the EU and therefore can use the green lane. These are consumer to consumer parcels and business to consumer parcels.

2. Rules changes that safeguard Northern Ireland’s place in the Union

The Framework provides solutions to a wide range of practical issues including:

• removing the ban on certain products including seed potatoes and sausages;
• removing the requirements on pet travel;
• the ability for VAT changes to be applied UK wide; and
• ensuring that medicines are available at the same time and basis right across the UK.

3. A new mechanism to give NI politicians more power over future changes impacting NI  

• The deal creates a new “Stormont brake” that would give the Northern Ireland assembly the power to decide whether changes to EU rules in the scope of the protocol apply.
• The brake can be triggered by the same threshold as a petition of concern – 30 MLAs from two political parties. This is to be used as a last resort and there will have to be a demonstration that all other engagement processes have been exhausted.

What does this mean for Members?

Businesses are currently working through the full details of the agreement, but broadly welcome the framework, as it is seen to said in reducing barriers for GB-NI goods movements and simplifying regulatory environments.

There were significant changes in the following areas:

• Customs
• Agri-food
• VAT & excise
• Human and veterinary medicines
• Subsidies

CBI is currently working through the changes with its members and will be producing full and further analysis soon.

What is the wider impact on the UK economy?

Now that the Northern Ireland Protocol has been agreed, the UK and EU can begin to normalise their relationship and kick-start many matters that have been on hold:

• The UK-EU Trade & Cooperation Agreement set out a pathway for UK accession to Horizon Europe. The UK being part of EU research programmes has always been a 'win-win' situation for both the UK and the EU. Collaboration on research and innovation is key to UK and EU competitiveness, driving long term sustainable growth and tackling global challenges such as climate change (of which this is a key focus for Horizon Europe programme)
• Financial Services dialogue. Though the TCA did not include provisions on financial services, it did introduce the scope for continued talks, and in March 2021 both sides concluded technical negotiations for a Memorandum of Understanding (MoU) on financial services. However, this never progressed. If finalised, the MoU will pave the way for greater regulatory cooperation on financial services, leading to better services for customers on both sides.
• Future cooperation on global issues. From reaching Net Zero to close collaboration on international security, the UK and EU have shared core values that can be more impactful by working together to achieve common aims.
• Restoration of power-sharing in NI. It is hoped that this deal will facilitate the return of the NI Executive.  This is key to driving economic growth and prosperity in the region. There is currently no agreed Programme for Government (PfG) and NI Civil Servants are operating on 1 year budget. A restored NI Executive is key to the delivery of key strategies in areas including infrastructure, skills and green growth.

What is CBI doing?

The CBI is reading the Windsor Framework closely and working with members to tease out the full scale of the impacts for business. Claire Sullivan, Head of NI Policy and Nicola Hetherington, Head of European Trade are working closely with businesses to understand the details for both NI and GB members and to work with government on successfully implementing it.

Opportunities to get involved:

• Join the CBI Northern Ireland Protocol Working Group
• 121 meetings with Nicola and Claire