Paterson scandal 'increases risk' of trade war with EU over Northern Ireland Protocol

Owen Paterson during the Standards Co,mission Vote, which caused outrage. © Provided by The Telegraph Owen Paterson during the Standards Co,mission Vote, which caused outrage.

The Owen Paterson lobbying scandal has increased the risk of Britain starting a trade war with Brussels by triggering Article 16 of the Northern Ireland Protocol, EU diplomats have said. 

There is building expectation the Government will unilaterally override parts of the protocol by invoking the clause, despite ongoing negotiations with the EU over cutting checks at the Irish Sea border. 

“The risk of triggering Art 16 appears to be very substantial and increased by a need to distract from the embarrassment of the Paterson affair,” a senior EU diplomat said, ahead of a debate on parliamentary standards on Monday.

The Government last week voted to overhaul the standards body, which found Mr Paterson guilty of breaking lobbying rules, before executing a humiliating U-Turn. Mr Paterson, a Brexiteer, then resigned.

“The Prime Minister is constantly trying to pick a fight on things like this so he hopes people don’t look elsewhere in the forest, which are things like the Owen Paterson affair,” Sir Keir Starmer, the Labour leader, told the BBC on Sunday.

UK ministers are already working on legal changes to British law to prepare the ground for a possible triggering of the clause, which Brussels says would break international law, before Christmas.

Article 16 allows either side to unilaterally override parts of the protocol if it is causing serious “economic, societal or environmental difficulties”. The UK argues those conditions have already been met but wants to see how negotiations with the EU progress. 

Senior figures in Dublin and Brussels have started planning for Britain to trigger Article 16 at some point after the COP climate change conference in Glasgow.

Irish and Belgian ministers have warned that the EU could terminate its trade deal with the UK if the nuclear option of Article 16 was used.

It could serve year long notice of its intention to cancel the deal, as well as trigger legal action and dispute clauses in the Brexit treaties.

“The EU will respond in a very serious way to that,” Simon Coveney, Ireland’s foreign minister, told RTE, insisting the trade deal was dependent on the implementation of the divorce deal.

“One is contingent on the other. So if one is being set aside, there is a danger that the other will also be set aside by the EU,” he added.

Simon Coveney, Ireland's foreign minister. - Reuters © Reuters/ Lorraine O’Sullivan Simon Coveney, Ireland’s foreign minister. – Reuters

A senior EU diplomat said. “If it comes, what will matter is what Frost revokes. If it is substantial so will be the EU response. If it is cosmetic the same will apply.”

The diplomat added, “We are not going to suddenly suspend the trade deal unless the action is so egregious it cannot be ignored such as unilaterally stripping out the European Court of Justice.”

An EU source said, “If Article 16 is triggered there will be the initial statements from the European Commission and capitals, but we’ll still be here talking, the same people around the same tables, Northern Ireland will still be on the island of Ireland and part of the United Kingdom.”

Under the protocol, Northern Ireland continues to follow some EU laws to prevent a hard Irish border with EU member Ireland.

The UK has demanded an end to the role of European judges overseeing the implementation of EU law in Northern Ireland. Brussels insists the Luxembourg court must be the final arbiter of any questions of EU law.

Loyalists claim the imposition of economic barriers on trade between Great Britain and Northern Ireland has changed the region’s constitutional position within the UK.

The Progressive Unionist Party, which is politically aligned to the paramilitary Ulster Volunteer Force, said there is “no basis” for unionists to continue to support Northern Ireland’s Good Friday peace agreement because it had been undermined by the protocol.  

A bus was hijacked by four masked men and set on fire on the outskirts of Belfast on Sunday, amid discontent over the protocol. It was the fourth attack this year, Infrastructure Minister Nichola Mallon said.

Sign up to the Front Page newsletter for free: Your essential guide to the day’s agenda from The Telegraph – direct to your inbox seven days a week.