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Title XI: Level playing field for open and fair competition and sustainable
development
81. The Agreement’s provisions in this area, implementing commitments made in
the 2019 Political Declaration, were the subject of considerable controversy
during the negotiations. The EU was forced to drop its ambitious demands for
dynamic alignment and for the UK to be legally required to maintain
equivalent legislative systems to the EU’s in some areas. The system that has
been agreed upon does not compromise the UK’s sovereignty in any area,
does not involve the European Court of Justice in any way, and is reciprocal.
Both sides have the right to set their own laws, subject to the broad
constraints of this Agreement in this area as in any other. And both sides have
the right, in certain constrained ways, and subject to arbitration, to take
countermeasures if they believe they are being damaged by measures taken
by the other Party in subsidy policy, labour and social policy, or climate and
environment policy. If such measures are used too frequently either side can
trigger a review of these provisions and the trade aspects of the Treaty more
broadly, aiming to end with a different balance of rights and obligations.
Chapter 1: General Provisions
82. The Chapter sets out some principles and objectives for this title. It recognises
the right of each Party to set its own policies and priorities and determine the
levels of protection it deems appropriate in its laws.
Chapter 2: Competition
83. The Agreement commits both Parties to maintain their high standards of
competition law, including enforcing these laws, maintaining their independent
competition authorities, and applying competition law on a procedurally fair,
transparent and non-discriminatory basis. The Chapter enables further
cooperation between the UK and EU competition authorities.
Chapter 3: Subsidies
84. The Agreement ensures that each Party will have in place its own
independent system of subsidy control and that neither Party is bound to
follow the rules of the other. It includes some broad principles which shape
the design of both sides’ systems, aiming to ensure that the granting of
subsidy does not have detrimental effects on trade between the Parties. It
also includes some specific principles on subsidies that are particularly
distortive, such as those prohibited by the WTO. The Agreement makes clear
that it is for each Party to determine how these principles will be implemented
in its domestic law. There is a separate joint declaration that provides non-
binding guidance on additional sectors which either side may take into
consideration in their respective systems of subsidy control.
85. The Agreement requires both sides to be transparent about the subsidies they
grant and to establish or maintain an independent body with an appropriate
role in their respective subsidy systems, while retaining full discretion over any
functions that body may have. The Agreement includes provisions on the role
of domestic courts in reviewing domestic subsidy decisions. For the UK, this