Chapter 5: Conclusions
111.The Crown Dependencies are neither part of the EU nor of the UK, and their citizens did not as of right participate in the June 2016 UK referendum. Nevertheless, they have a unique constitutional relationship both with the UK and, as encapsulated in Protocol 3 to the UK’s Treaty of Accession, with the EU. The consequences of Brexit for the Crown Dependencies are therefore significant.
112.The evidence we have received has drawn attention to three intertwined, and potentially conflicting, priorities for the Crown Dependencies in the context of the Brexit negotiations, namely:
- Maintenance of their centuries-old constitutional relationship with the UK;
- Notwithstanding the loss of Protocol 3 upon UK withdrawal, retention so far as possible of the benefits of the existing relationship between the Crown Dependencies and the EU;
- The evolution of the Crown Dependencies’ international identities, while respecting the UK’s constitutional obligation to represent them in matters of defence and international relations.
Seeking to keep these priorities in balance during the negotiation process will not be easy.
113.We note in particular the implications of Brexit for:
- The Crown Dependencies’ continued ability in trade freely in goods, including fisheries, agriculture and manufacturing, both with the UK and the EU;
- The financial services sectors in the Crown Dependencies, and in particular the Crown Dependencies’ continued ability to secure regulatory equivalence where appropriate;
- The ability to continue to attract EU citizens to live and work in the Crown Dependencies, in particular in sectors such as agriculture, health, financial services and tourism, while at the same time retaining the Common Travel Area between the Crown Dependencies and the UK;
- Existing data protection cooperation, transport and communication links, and energy cooperation between the Crown Dependencies and the EU.
114.The UK Government has a constitutional responsibility to represent the interests of the Crown Dependencies in the Brexit negotiations. The Chief Ministers of the Crown Dependencies expressed their satisfaction at the Government’s engagement thus far in relation to Brexit. The real test of this engagement will come as negotiations begin. We call on the Government to ensure that the Crown Dependencies remain fully involved as negotiations proceed, and that their concerns and priorities are properly taken into account by the UK negotiators.
115.We acknowledge the evidence we have received that the Crown Dependencies’ close constitutional, economic and cultural relationships with the UK remain paramount. It is therefore important that the terms of the future relationship between the Crown Dependencies and the EU do not undermine the Crown Dependencies’ relationship with the UK, whether in terms of the free movement of goods and people to and from the UK, or the symbiotic link between the Crown Dependencies’ financial services sectors and the City of London.
116.We urge the Government to reflect on the implications for the Crown Dependencies of the UK’s post-Brexit policy priorities. In particular, the Government must ensure that the Crown Dependencies are kept fully apprised of, and are given the opportunity where appropriate to participate in, future free trade agreements with countries beyond the EU. We also call on the Government to support Guernsey and Jersey in their efforts to ensure that the UK’s WTO membership is extended to cover them, as it already does the Isle of Man.
117.We have heard evidence that Brexit could prove a further impetus in the development of the Crown Dependencies’ international identities. This remains to be seen. The evolution of these identities is a matter for bilateral discussion and agreement between the Crown Dependencies and the UK Government. While taking into account any future developments, the UK Government must continue to fulfil its constitutional obligations to represent the interests of the Crown Dependencies in international relations, even where these differ from those of the UK, both during the Brexit negotiations and beyond.