On Monday 23rd June, the Chief Minister of Gibraltar, Fabian Picardo, issued a press release outlining the content of the statement presented to the Government of Gibraltar, regarding the agreement for a treaty between the United Kingdom and the European Union in relation to Gibraltar.
Here is a brief summary of that agreement which now clears the way for the completion of the drafting of the legal text of the treaty.
The treaty between Gibraltar and the EU includes three main pillars:
Circulation of Persons
- Establishes a common travel area between Gibraltar and the Schengen Area, eliminating border checks at the Gibraltar-Spain border.
- Joint immigration checkpoints will be set up at Gibraltar’s airport and port, allowing seamless access to Schengen once cleared.
- Gibraltar retains sole authority over granting ID cards and residence permits but will consult Schengen states to ensure applicants pose no security threat.
- Enhanced security cooperation is included, ensuring Gibraltar becomes safer than ever.
Circulation of Goods
- Goods will flow freely between Gibraltar and the EU Customs Union, clearing EU customs points in La Línea and Algeciras.
- Gibraltar replaces its import duty with a new transaction tax (TT), distinct from EU VAT rules, with minimum rates aligned gradually to the lowest EU VAT (currently 17% in Luxembourg).
- Certain goods, like food, medicines, and children’s clothing, benefit from reduced or zero TT rates.
- Special customs procedures will protect key sectors like shipping and bunkering.
- Traders buying EU goods pay no VAT but incur Gibraltar TT upon importation, avoiding double taxation.
- Goods from the UK remain exempt from tariffs due to the UK-EU trade agreement.
Other Provisions
- The treaty also addresses environmental protection, climate change, labor standards, frontier workers, and transport.
- Gibraltar Airport will now host direct commercial flights to and from the EU, surpassing previous arrangements without affecting Gibraltar’s sovereignty or control.
- Overall, the treaty secures economic stability, enhances living conditions, and increases safety and mobility for Gibraltar.
You can read the full statement here: https://www.gibraltar.gov.gi/press-releases/cm-statement-to-parliament-on-the-treaty-4652025-10995
Announcement
