100 Days Until the End of the Brexit Transition

Brexit has occurred. The UK is no longer part of the EU. But the effect of Brexit was softened with a year-long transition period during which the UK and EU were supposed to negotiate their future relationship.

The last day of the current transition period is scheduled to be December 31, 2020. That leave little time for the UK and EU to complete their negotiations; negotiations that have been hampered as each deals with the issues surrounding Covid-19.

Unfortunately, the precise future for aircraft parts manufactured under UK CAA production approval or maintained under UK CAA maintenance approval remains a little unclear.

State of Negotiations

Last year, the UK and EU signed a Withdrawal Agreement that included a one year transition period. During this transition period, the EU treated the United Kingdom as if it were a Member State, with the exception of participation in the EU institutions and governance structures. This notably meant that the UK continued to enjoy the privileges of the EASA bilateral agreements and the world treated certificates in the UK as if they were still issued under EASA processes. Thus, an EASA Form One issued by a UK CAA repair station on January 2, 2020 had the same legal effect as one issued on December 30, 2019.

The Withdrawal Agreement also included an Irish Protocol that guaranteed no hard border between Ireland and Northern Ireland, but in return required a customs border to be established between Northern Ireland and the rest of the UK. Recently, Prime Minister Boris Johnson has pledged to renege on the Irish Protocol; which would mean that there would be no customs border between Northern Ireland and the rest of the UK; but that implies that there would be a customs border between Northern Ireland and Ireland. This pledge has been criticized as a potential violation of international law. Subsequent British efforts to provide a legislative support for the pledge have been called “lamentable” by prominent figures like UK Government Special Envoy (and human rights activist) Amal Clooney.

A clause that permitted extension of the Withdrawal Agreement had a deadline of July 1, 2020 and that deadline seems to have passed without the extension being invoked. This doesn’t really prevent the parties from agreeing to an extension – but it makes it a little less likely.

It is also worth noting that under the EU’s Brexit Regulation, certain certificates, like UK type certificates become invalid for EU purposes nine months after the Withdrawal Date (January 31, 2020), which means that they could become invalid. Contrast this with a provision in Article 10 of the same regulation that invalidates that Regulation if a Withdrawal Agreement is reached pursuant to Article 50(2) (the EU provision that permits a withdrawal agreement with a withdrawing member of the EU). The current EU-UK Withdrawal Agreement cites Article 50(2) as part of its basis, but it does not actually address how aviation will be covered. Instead, the EU and UK agreed to “explore the possibility of cooperation” with respect to EASA-UK CAA relations, but nothing has been passed in Europe to address certificates from the UK. The current EU-UK Withdrawal Agreement appears to render the EU Brexit Regulation moot, but if that is true then it means that there is no clear guidance on what happens after the transition period, particularly if the EU withdraws its offer to exetend US aviation regulations to the UK.

While the UK CAA is quite competent to support its own airworthiness needs, if the EU will not recognize UK CAA certificates after December 31, 2020 then this becomes a problem in terms of being able to support the EU-registered fleet. It potentially devalues aircraft components or complicates the compliance path in uncertain ways.

During the 2020 transition period, EASA continues to process applications from existing UK CAA approval holder within the context of the early application process; EASA expects to issue EASA certificates to many businesses who currently hold UK CAA certificates. 

What Comes Next?

A “Hard Brexit” scenario is still a very real possibility. This is because the UK is setting early deadlines for concluding a long-term agreement (October 15) and the UK Prime Minister has indicated that he’s prepared to walk away from trade talks rather than compromise on what he regards as core principles of Brexit. The “Irish Backstop” concerns reflect a very delicate point because of the competing concerns between fully withdrawing from the EU Common Market and retaining a “soft border” between Ireland and Northern Ireland.

Because of the lack of clarity on “what happens next,” anything is possible but it is highly likely that the EU will simply reissue the EU Brexit Regulation, or possibly rule that it became once again “live” upon the expiration of the transitional Withdrawal Agreement. If this happens then it would create a new transition during which UK parties could decide whether they needed EU recognition or whether UK recognition was sufficient (the UK already has a number of bilateral agreements ready-to-go in order to facilitate international recognition of UK certifications).  This means that it is likely that (1) the EU would recognize the validity of components already on EU aircraft [components would not have to be removed from aircraft], and (2) components with a EASA Form 1 certificates of release issued by UK-registered businesses prior to the end of the transition period would very likely be recognized as airworthy after the transition period.

For the UK CAA, it has already announced that anything certified under EASA’s authority that was considered preemptively airworthy before the end of the transition period would continue to be recognized in the UK for at least two years after the transition period ends..

An ‘even harder Brexit‘ is also a possibility, in which the EU simply stops recognizing all UK-CAA certificates (including EASA Form 1) after December 31, 2020. While possible, this is unlikely because of the adverse effect it would have on maintaining the technical airworthiness of EU-registered aircraft. If this happened, then In such a case, distributors holding parts with UK CAA Certificates might not be able to sell them for installation on EU-registered aircraft, but they could still be installed on UK-registered aircraft and on the aircraft registered in the nations with which the UK CAA has appropriate bilateral agreements (like Canada, Japan and the United States).

But there are about four weeks remaining before the current UK negotiation deadline, so a “soft Brexit” – in which UK CAA either participates as a third-country member of EASA or otherwise enters into a deal with EASA for mutual recognition – still remains a real possibility. In such a case, distributors holding parts with UK CAA Certificates would enjoy a “status-quo” situation.

EASA still is restrained from publicly commenting on Brexit; they are waiting for the high-level political negotiations to conclude before they can start to expending resources and take an official position.  Nonetheless, EASA contacts have privately assured us that EASA is ready for any direction in which Brexit may go, and EASA hopes to be able to to implement some form of mutual reliance with the UK CAA.

About Jason Dickstein
Mr. Dickstein is the President of the Washington Aviation Group, a Washington, DC-based aviation law firm. Since 1992, he has represented aviation trade associations and businesses that include aircraft and aircraft parts manufacturers, distributors, and repair stations, as well as both commercial and private operators. Blog content published by Mr. Dickstein is not legal advice; and may not reflect all possible fact patterns. Readers should exercise care when applying information from blog articles to their own fact patterns.

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