Frequently Asked Questions
What is Brexit?
It is a word which has come to be used to describe the process of the UK withdrawing from its membership of the European Union.
What is the European Union?
It is an economic and political partnership which comprises, currently, 28 Member States. It pools decision-making powers in certain areas, in order to make common rules to allow for the creation of and functioning of a single market. There are no duties imposed on goods which are exported from one Member State to another and common standards mean that food, agricultural products and manufactured goods can pass freely throughout the EU.
Hasn’t the UK left the European Union already?
Yes the UK withdrew from the EU on 31 January 2020. The UK and the EU have now entered into a transition period.
What is the transition period and how long will it last?
The transition period will last from 31 January 2020 until 31 December 2020 while the EU and UK negotiate new arrangements. During the transition period existing rules and arrangements will remain in place for people and business in the UK, EU and the Isle of Man.
What do I need to do to prepare for the end of the transition period?
The Isle of Man’s relationship with the EU after the transition period will be dependent on the agreement on the future relationship reached between the UK and the EU. However there are a few things that you can do now to prepare for 1 January 2021 such as checking your passport validity and registering your business for an EORI number. Visit this page to find out more.
What is the European Economic Area?
The European Economic Area (EEA) consists of all EU countries as well as Iceland, Norway and Liechtenstein. It allows them to be part of the EU’s single market. Switzerland is neither an EU nor EEA member but is part of the single market - this means Swiss nationals have the same rights to live and work in the UK as other EEA nationals.
What is the Isle of Man’s current relationship with the EU?
The Isle of Man is not part of the European Union (EU) in its own right, and is not included within the scope of the UK's membership of the EU. The Isle of Man makes no financial contribution to the European Union nor does it receive any funding from the EU. It is not represented in the European Parliament but the Island does have a limited relationship with the EU under what is known as 'Protocol 3.' This relationship is maintained during the transition period. The Isle of Man’s relationship with the EU after the transition period will be dependent on the agreement on the future relationship reached between the UK and the EU.
What is Protocol 3?
The relationship between the Isle of Man and the EU is set out in Protocol 3 to the UK's Act of Accession by which the UK became a member of the EU. The Protocol allows the Island to be part of the EU customs area which permits the free movement of manufactured goods and agricultural products in trade between the Island and the Union, as well as free movement of people between the Isle of Man and the European Union.
Apart from the requirements of the Protocol - in particular that the Isle of Man must apply the same treatment to all natural and legal persons of the EU - other Union rules do not apply. The Island's relationship with the EU allows it to trade with countries in the European Economic Area (EEA) similarly to its trade with the Union itself.
Will Brexit affect the Isle of Man's relationship with the United Kingdom?
The Isle of Man is a British Crown Dependency with Her Majesty The Queen as Sovereign. The Isle of Man is not part of the United Kingdom and is internally autonomous and self-governing with its own independent legal, administrative and fiscal systems. The Island's parliament, Tynwald, legislates for the Island. There is nothing to suggest Brexit will have an impact on the underlying constitutional relationship between the Isle of Man and the United Kingdom.
Irrespective of the UK's future relationship with the EU, the UK is the Island's most important trading partner and the Isle of Man is in a currency union with the UK. The free movement of goods and people between the two is of utmost importance.
The Customs and Excise Agreement between the Isle of Man and the UK will continue, though has been modified to provide for the UK's withdrawal from the EU. The new version was officially signed by Treasury Minister Alfred Cannan MHK and UK Financial Secretary to the Treasury and Paymaster General Mel Stride on 26 November 2018.
Why is the UK leaving?
The UK Government proposed that a referendum be held to ask British voters whether they would wish the UK to remain an EU Member State, or to leave. The vote determined that the UK should leave.
What is Article 50?
The process by which a Member State may leave the EU is set out in Article 50 of the Treaty on the Functioning of the European Union. Acting on the result of the referendum, the UK Government signalled its intention to leave, on 29 March 2017. This activated the process, and set the date on which the UK is due to cease to be an EU Member State as 29 March 2019. Due to the fact that the House of Commons has ratified any Withdrawal Agreement the Article 50 period has been extended on a number of occasions. The UK is now due to leave the EU at 11pm on 31 January 2020.
What did the Isle of Man do to prepare for the outcome of the referendum vote?
The Council of Ministers issued two reports in the run-up to the UK referendum on the potential effects of the vote on the Island: the first assessed the impact on the Island if the UK were to leave the EU, and the second looked in more detail at the possible alternatives to membership which the UK and the Isle of Man may choose to pursue. These reports were published and can be accessed online.
What is the Isle of Man Government doing now?
Following the result of the referendum in June 2016 the Council of Ministers published a further two reports. The third report provided updated information on the withdrawal process and analysis of the potential impact of Brexit for the Isle of Man. The fourth report provided an update on the Isle of Man Government’s ongoing work in preparation for the UK’s withdrawal from the European Union. These reports were published and can be accessed online.
The Council of Ministers has established the European Union Advisory Group to assess the implications of the UK’s withdrawal from the EU in more detail, and to provide policy advice on future options and opportunities for the Island, The Group is chaired by the Chief Secretary and includes senior officers from the Cabinet Office, the Treasury, HM Attorney General’s Chambers and the Departments for Enterprise, and for Environment, Food and Agriculture.
The Chief Minister has led an extensive programme of engagement to raise awareness of the Island's position including quarterly meetings with the, Parliamentary Under-Secretary of State at the Department for Exiting the European Union, proactive engagement with various UK parliamentary committees, with the other Crown Dependencies, our neighbouring jurisdictions and also engagement at the heart of the EU in Brussels.
Officers from the Isle of Man Government continue to work with relevant officials from across the UK Government to set out the Isle of Man's priorities and discuss the implications of withdrawal for the Island. This work will help to inform the UK's position but is also essential in building contacts with the people who will be involved in the negotiations on the future relationship between the UK and the EU so that they are clear about the Island's issues and priorities.
What is ‘the deal’?
‘The deal’ refers to the Withdrawal Agreement and the Political Declaration agreed between the UK Government and the European Union. The Withdrawal Agreement sets out the terms on which the UK will leave the EU. The Political Declaration sets out a framework for the UK and the EU’s future trading relationship.
‘The deal’ was first agreed between Theresa May’s Government and the EU on 25 November 2018, this deal however was never ratified by the UK parliament. Upon taking office Prime Minister Boris Johnson renegotiated changes to the Withdrawal Agreement and Political Declaration. This revised version of the deal was agreed by the European Council on 17 October 2019.
Does the Withdrawal Agreement apply to the Isle of Man?
The Withdrawal Agreement applies to the Isle of Man to the extent of the Island’s current relationship with the EU. In other words, it would retain the status quo for the implementation period.
What is the Isle of Man Government doing to ensure the UK Government understands our priorities for Brexit?
The Isle of Man Government and its counterparts in Jersey and Guernsey wrote to the UK Prime Minister following the UK referendum to emphasise that the Crown Dependencies had a direct interest in the terms of the UK’s withdrawal from the EU and in the negotiation of a future relationship. Continuing, as far as possible, the substance of the current arrangements with the EU, in particular the provisions of the Protocol 3 relating to trade in goods between the Islands and the EU was called for. The letter also explained that decisions taken on the grandfathering of rights for EU nationals were of particular relevance to the Crown Dependencies as the Islands are home to a significant number of non-British nationals and residents that have EU rights through their connection to the UK.
The UK Prime Minister Theresa May responded to confirm that the Crown Dependencies would be kept informed and offered the opportunity to contribute to negotiations where relevant and appropriate. In March 2017 the UK Prime Minister wrote to the Chief Minister in advance of the triggering of Article 50 to update the Isle of Man on the UK Government’s plan for engagement with the Crown Dependencies during the UK’s forthcoming negotiations with the EU. The UK Prime Minister advised that the constitutional relationship between the United Kingdom and the Crown Dependencies is a 'valued, historical and special one.'
The Chief Minister welcomed the assurances provided and the confirmation that Isle of Man’s constitutional relationship with the United Kingdom would not be impacted by the UK’s withdrawal from the EU. The Isle of Man Government continues to strengthen political and official level contacts, particularly with the UK Cabinet Office, the Department for Exiting the EU, and Department for International Trade, to ensure that the Isle of Man’s priorities are understood on as many fronts as possible. In addition, the Isle of Man will continue to talk to its partners across the Devolved Administrations and Crown Dependencies and Overseas Territories.
Our ongoing programme of engagement includes:
- Quarterly meetings with James Duddridge MP, Parliamentary Under-Secretary of State for the Department for Exiting the European Union (DExEU)
- Regular senior officer meetings with DExEU
- Regular meetings with the Home Office on border and Common Travel Area issues
- Regular meetings with HMRC and HM Treasury on customs & excise arrangements
- Meetings with the World Trade Organisation (WTO) Unit at the Department for International Trade on potential trading relations once Protocol 3 falls away
- Ongoing contact with the Crown Dependencies Team at the Ministry of Justice
- Regular meetings with the Department for Environment, Food and Rural Affairs (DEFRA) on agriculture and fisheries
- Submissions to three UK Parliament Committee enquiries on the effects of Brexit
- Regular engagement with the British-Manx All Party Parliamentary Group – a cross party group of MPs with an interest in the Isle of Man
- An ongoing targeted programme of 1-2-1 meetings with various MPs and peers, including delegations at both the Conservative and Labour Party conferences.
Is this the time for the Isle of Man to become independent?
It is Isle of Man Government policy, supported by a resolution of Tynwald, to remain a British Crown Dependency.
The Isle of Man Government does not envisage seeking a separate relationship with the EU from that which is negotiated by the UK for itself. If the Isle of Man were to become independent, Government would need to negotiate with the UK to guarantee free trade and free movement of people, as well as negotiating agreements with the EU and other countries. Investors, who we rely on to help grow the Island’s economy, prefer stability and certainty.
Could the Isle of Man seek a different relationship with the EU from that of the UK?
This would not be in our interests as it would likely prevent us from continuing to benefit from the free movement of people and goods between the Island and the UK, our closest neighbour and principal trading partner.
Most potential options for the Isle of Man to have an alternative relationship with the EU, for example becoming a member of the European Free Trade Association (EFTA), would first require us to be an independent state. As outlined above, now is the wrong time for the Island to consider independence.
Could some sort of closer relationship with Ireland allow us access to EU markets on better terms than the UK?
No. Firstly, Ireland is a part of the EU Common Market and therefore no nation can have a trading relationship with Ireland without negotiating that relationship with the whole EU. In this respect, our geographical and cultural proximity to Ireland and our positive working relationship with the Irish Government is not relevant, we would still have to negotiate a trade agreement with the European Commission for the EU as a whole.
Secondly, negotiating a trade agreement between the Isle of Man and the EU would likely undermine our Customs Union with the UK and mean that we would no longer have access to free movement of goods and services to and from the UK market. As over 80% of our trade is with the UK market, it would go significantly against the Island’s economic interests to take such an approach.
What opportunities may there be for the Isle of Man after the UK leaves the EU?
The Isle of Man Government is identifying and analysing opportunities associated with the UK’s withdrawal from the EU.
As has been set out in the Fourth Interim Report, the main opportunities for the Island lie in the extent to which the Isle of Man can participate alongside the UK in new trading arrangements with third countries and, indeed, examining the relationship with the UK and assess opportunities to increase mutual competitiveness. The focus at this stage is ensuring that the Isle of Man is positioned effectively to take advantage of opportunities as they arise. Because the Island is in Customs Union with the UK under the 1979 Customs and Excise Agreement there is free movement of goods between the UK and IOM.
As a result, it is highly likely that the Island will have to be included in the UK’s new free trade agreements, at least as far as they relate to trade in goods. However, the nature of the individual agreements may not always be in the best interests of the Manx economy so the Island will give every opportunity careful consideration.
Why were residents of the Isle of Man not eligible to vote in the 2016 referendum?
The Isle of Man has its own political system, with its own system of elections, separate from that of the United Kingdom. Isle of Man residents are never eligible to cast a vote in any UK election or referendum, irrespective of whether the result may have an impact for the Island. In the same way, only Island residents are eligible to participate in Manx elections.
In some cases people resident on the Island may have been eligible to vote in the referendum by virtue of having recently lived in the UK and thus still having been registered to vote there by proxy or postal vote.
The residents of Gibraltar, while not residents of the UK and not ordinarily able to vote in UK elections and referenda, were able to vote in the 2016 referendum as the UK’s membership of the EU extends to include Gibraltar. This is not the case for the Isle of Man.