The European Union and the United Kingdom managed to avoid a "hard divorce" with severe consequences for the economy and everyday life
As RFI notes, the UK officially left the EU on January 31, 2020. An 11-month transition period followed, during which London adhered to the rules of the single market and customs union. In his New Year's address to Britons, Prime Minister Boris Johnson called the event an "incredible moment" of gaining freedom, promising his compatriots a "year of change and hope."
The 1,246-page agreement preserved the free trade zone between the EU and the UK—without customs duties or quotas—provided the UK complies with EU social and environmental standards, as well as rules on state aid, labor market, and taxation. While the foundations of economic and trade relations remain, citizens and businesses—both in the UK and EU countries—will face numerous changes from January 1.
Customs and Border Control
Customs controls on goods, abolished in 1993, have been reinstated at EU-UK borders. Businesses must once again fill out declarations for imports and exports. The additional administrative burden risks increasing costs and slowing trade. Alongside customs controls, sanitary and veterinary checks on goods entering the EU have been restored.
End of Free Movement: Visas and Residence Permits
From January 1, free movement of citizens between the UK and EU countries is restricted. Visa-free travel remains for stays of up to 90 days within any 180-day period. For now, border crossings are still allowed with identity cards (national ID cards). From October 1, 2021, Britons and EU citizens will need passports for short trips to each other's countries.
The UK's exit from the European health insurance system will require Britons traveling to the EU to purchase special travel insurance. Restrictions also affect Britons who bought holiday homes in France or Italy: they can live freely and without visas on their villas for no more than three months in any six-month period.
Both sides are introducing visa regimes for permanent residence. Britons wishing to move to one of the 27 EU countries to live and work must now obtain long-term visas or residence permits on the same basis as all other foreigners.
From January 1, Europeans deciding to move across the Channel will also face new requirements. To obtain a UK work visa (valid for five years), they need a job offer from an employer, a guaranteed annual income of at least £25,600 (nearly €29,000), mandatory English language proficiency, and a certain level of professional qualification.
Residents' Fate: Six Months to Register
London and Brussels have agreed on guarantees for those citizens who were permanently residing in the UK or EU countries as of December 31, 2020. They will retain their social rights (health insurance, pension guarantees, unemployment insurance). However, Europeans must register their UK resident status by June 30; otherwise, their permanent stay on the island will become illegal.
French newspaper Le Monde recently noted that for Europeans working in the UK for more than five years, registration is not a problem—they receive indefinite "permanent resident" status. However, a number of categories of EU citizens face difficulties with registration. The press estimates that 3-4 million people from the 27 EU states live on British territory. More than a million Britons live and work in EU countries.
Education and Student Exchange
Having finally left the EU, the UK also exited the European student exchange program Erasmus. Each year, 32,000 students from EU countries participated in short-term studies at British universities under this program. London declined to participate in Erasmus, calling it "too expensive" for the UK budget. From September 2021, British students are promised a new international university exchange program.
150,000 young EU citizens studying in UK higher education institutions must now obtain student visas. They will also face significantly higher tuition fees, notes France 24.
Air Travel and Other Transport
The agreement between the UK and EU guarantees uninterrupted air, road, rail, and sea connections, but on less favorable terms than before.
The UK's exit from the EU has created additional problems in the air transport market. British airlines have lost the right to carry passengers between two destinations within the EU (without obtaining a special operating license in an EU country). For example, from January 1, a British carrier can continue flights on the London-Paris route but loses the formal right to operate connecting flights (e.g., London-Paris-Rome or London-Paris-Sydney) or cabotage flights (Berlin-Amsterdam).
British airline EasyJet (Europe's second-largest low-cost carrier) established its subsidiary EasyJet Europe in Austria back in 2017, obtaining a European operating certificate to retain the right to operate within the EU market and between the EU and other countries.
On the eve of the new year, urgent measures had to be taken by some airlines from EU countries – Ireland's Ryanair (Europe's largest low-cost carrier) and Hungary's Wizz Air. As reported by The Financial Times, they restricted the voting rights of their British shareholders at the general meeting of shareholders. The purpose of this measure is to maintain a license for intra-EU flights, where an operating certificate is available only to companies in which more than 50% of capital is controlled by citizens of the EU (as well as Switzerland, Norway, Iceland, and Liechtenstein).
Finance – in waiting mode
The agreement on new rules for the partnership between the UK and the EU preserves free trade in goods but does not cover finance and services. These sectors, which account for almost 80% of British GDP, made up the lion's share of UK exports to EU countries. Access for British businesses to the European market for banking, financial, insurance, consulting, legal, and other services became the subject of separate negotiations, which will continue in 2021.
From January 1, financial organizations in the UK lost the right to directly sell their services in EU countries. Banks, investment funds, and companies of Europe's largest financial center – the City of London – will either have to open full-fledged branches in EU countries or wait for the European Commission to allow them to operate in an "equivalence regime" (in case of full compliance of national regulation with European).
Some large financial structures have preemptively moved part of their operations from London to Frankfurt, Dublin, Paris, or Luxembourg.
Return of paid roaming
In 2017, the European Union abolished additional charges for roaming for mobile subscribers. The cost of calls, SMS messages, and mobile internet remained unchanged for citizens of any EU country when traveling to the 28 union countries, as well as Norway, Liechtenstein, and Iceland.
From now on, free roaming for EU citizens is not guaranteed when traveling to British territory, where local mobile operators have received the right to charge additional fees from foreign mobile subscribers. Additional expenses also await holders of British mobile phones in the EU.
Among the affected – alcohol and animals
This is far from a complete list of changes related to the consequences of the UK's final exit from the EU. Many seemingly minor innovations may create additional difficulties for ordinary citizens on both sides of the English Channel. For example, ordinary Britons will face customs restrictions when exporting goods from EU countries: duty-free now allows no more than one carton of cigarettes, up to 18 liters of wine, no more than 4 liters of strong alcohol, as well as purchases not exceeding 390 pounds (440 euros).
Pet owners will face new formalities when traveling with their animals across the EU-UK border. Problems may also increase for holders of driving licenses issued in the UK who permanently reside in the EU. For instance, the French Interior Ministry requires the replacement of British licenses with French ones during 2021.