What happens if UK takes legal action over post-Brexit fishing row with France?

Published

3 years ago

November 2, 2021

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The French government has stepped back from a threat to impose disruptive port checks on lorries and boats after the UK threatened to take legal action in a row over post-Brexit fishing licences.

Key talks between the two sides will take place later this week aimed at resolving the disagreement, but the risk of further escalation remains.

Sky News examines what is behind the row between the UK and France and what measures London could take if the impasse rumbles on.

What is the dispute about?

Under the terms of the Brexit trade deal, which came into force on 1 January, EU access to UK waters and UK access to EU waters is now managed through a licensing system for fishing vessels.

The current row erupted after the UK authorities refused to give licences to some French fishing vessels to operate in UK waters because they believed they did not meet the requirements.

According to the French government, the UK has only issued half the fishing licences that Paris believes it is entitled to.

Environment Secretary George Eustice told Sky News last week that the UK has issued post-Brexit licences to 1,700 vessels, including 750 French fishing boats, which amounts to 98% of applicants.

But the row deepened when the Cornelis Gert Jan scallop trawler was detained by French authorities last Thursday near the port of Le Havre.

The owners of the British vessel denied French claims that it did not have the correct licence to fish in French waters and said the Cornelis was being used as a “pawn” in the wider UK-France fishing dispute.

France initially said that if the UK did not grant more licences for its fishing vessels it would, from Tuesday, block its ports, carry out security checks on British vessels, reinforce controls of lorries to and from the UK, reinforce customs and hygiene controls, and raise tariffs.

However, Paris has stepped back from introducing these measures.

Downing Street says talks will take place with France on Wednesday about the situation, as well as other “issues important to the UK-EU relationship, including the Northern Ireland Protocol”.

What are dispute resolution measures?

It is against this backdrop that the UK has threatened to take legal action.

The prospect was raised by Prime Minister Boris Johnson last week and repeated by the Foreign Secretary Liz Truss in a Sky News interview on Monday.

The foreign secretary set a 48-hour deadline for the fishing dispute to be resolved, although it’s not clear if that deadline still stands in light of recent moves from Paris.

If legal action were to be taken, this would involve the UK triggering the dispute resolution measures contained in the Brexit trade deal, officially known as the Trade and Cooperation Agreement (TCA).

The measures are designed to be used when one side feels that the other is in breach of the TCA.

Initially, this would mean a 30-day period of consultation between the two sides which can be extended if both parties agree.

The aim of this first step is to resolve any disagreement through dialogue.

But if a solution cannot be found, the complainant can progress things further and ask for an independent arbitration tribunal to be set up.

This would be made up of three members: one nominated by the UK, one put forward by the EU and a jointly-agreed chair.

The tribunal would then rule within 130 days of being set up, although an interim report would be issued earlier.

One side can ask for this timeline to be sped up, which would see it cut in half.

Tribunal rulings are legally binding and if a side is found to have breached the agreement they have 30 days to set out how they will comply.

Sam Lowe, a senior research fellow at the Centre for European Reform think-tank, said of the process: “In terms of the legal mechanisms we are very much talking about a process here that could drag on for a while.”

What happens if one side does not comply?

The other party can ask for compensation or suspend certain obligations contained in the agreement in areas like trade, aviation, road transport and fisheries.

The tribunal can be asked to rule on whether the suspension is appropriate, while the suspension should be rescinded if the other side then decides to follow its ruling.

There are also specific steps that one side can take in relation to fishing.

What measures can be taken on fishing?

One side could decide to entirely suspend access to its waters and scrap the preferential tariff agreement that applies to fishery products.

Again, an arbitration tribunal could end up getting involved, with it ruling if the measure is a proportionate response.

The UK, or indeed France, could choose to go further and apply tariffs on fisheries and non-fisheries products or even suspend elements of the TCA relating to trade and road transport.

Either side can also decide to bin the agreement on fisheries with a notice period of nine months.

What would the impact be on UK-EU relations long-term?

According to Sam Lowe: “If the UK feels the diplomatic route has been exhausted, proceeding with dispute resolution within the confines of the TCA is the proper way to go about things.

“At least in the TCA there are rules, processes to be followed; much better than spilling out into an unconstrained trade war with both the EU and UK free to do whatever they want.”

However, he warned that a simmering dispute could have a wider impact, adding: “These disputes do have political ramifications: they chip away at the good will necessary to reach a compromise on other outstanding issues such as Northern Ireland.”

Are the dispute resolution mechanisms different when it comes to Northern Ireland?

Yes.

The UK and EU are currently locked in talks over potential changes to the protocol, which is designed to avoid a hard border on the island of Ireland.

The protocol is part of the withdrawal agreement between the two sides and is separate from the TCA.

If these talks break down or do not prove fruitful, either side has the option of activating Article 16 of the protocol.

This states that if the protocol is causing “serious economic, societal or environmental difficulties that are liable to persist”, or leading to a “diversion of trade” then either the UK or EU can introduce “appropriate safeguard measures” to tackle the problems.

Brussels at one stage proposed using Article 16 to stop COVID vaccine exports from the EU moving to Great Britain from Northern Ireland, but stepped back from this after a backlash.

Opponents of the protocol in Northern Ireland have been calling on the UK government to invoke Article 16 to stop checks and controls on goods.

Politics

SEC drops investigation into PayPal’s stablecoin

Published

4 hours ago

April 30, 2025

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SEC drops investigation into PayPal’s stablecoin

PayPal says the US Securities and Exchange Commission has abandoned its investigation into the payment giant’s US-dollar stablecoin.

PayPal said in an April 29 regulatory filing that the SEC concluded its investigation into PayPal USD (PYUSD) and wouldn’t be taking any action.

The company said it received a subpoena from the SEC’s Division of Enforcement over its stablecoin in November 2023.

“The subpoena requests the production of documents. We are cooperating with the SEC in connection with this request,” PayPal stated at the time.

In its latest filing, the firm said the SEC notified it in February that the agency “was closing this inquiry without enforcement action.”

PayPal has said its stablecoin is 100% redeemable for US dollars and “fully backed” by dollar deposits, including short-term treasuries and cash equivalents.

However, the stablecoin has struggled to gain momentum in a crowded market dominated by rivals Tether and Circle. PYUSD has a market capitalization of just $880 million, less than 1% of Tether’s (USDT) $148.5 billion.

PayPal’s stablecoin has seen better growth this year with a 75% increase in PYUSD circulating supply since the beginning of 2025, according to CoinGecko. It remains down 14% from its peak supply of just over $1 billion in August 2024.

Earnings on PYUSD, Coinbase partnership

That growth could be bolstered by a company announcement on April 23 introducing rewards for PYUSD in a new loyalty offering that will enable US users to earn 3.7% annually for holding the asset on the platform.

Meanwhile, on April 24, PayPal announced a partnership with Coinbase to increase the adoption of PYUSD.

“We are excited to drive new, exciting, and innovative use cases together with Coinbase and the entire cryptocurrency community, putting PYUSD at the center,” said Alex Chriss, PayPal President and CEO.

The payments giant also reported robust first-quarter earnings and the completion of significant share repurchase activities.

The firm beat Wall Street estimates, earning $1.33 per share in the first quarter, topping analyst expectations of $1.16. Revenue rose 1% from a year before to $7.8 billion.

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BlackRock files to create digital shares tracking one of its money market funds

Published

5 hours ago

April 30, 2025

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BlackRock files to create digital shares tracking one of its money market funds

Asset manager BlackRock has filed to create digital ledger technology shares from one of the firm’s money market funds, which will leverage blockchain technology to maintain a mirror record of share ownership for investors.

The DLT shares will track BlackRock’s BLF Treasury Trust Fund (TTTXX), which may only be purchased from BlackRock Advisors and The Bank of New York Mellon (BNY), the firm said in its April 29 Form N-1A filing with the Securities and Exchange Commission.

The money market fund holds over $150 million worth of assets, invested almost entirely in US Treasury bills and cash.

BlackRock said that the shares “are expected to be purchased and held through BNY, which intends to use blockchain technology to maintain a mirror record of share ownership for its customers.”

Unlike the BlackRock USD Institutional Digital Liquidity Fund (BUIDL), DLT shares won’t be tokenized but will instead be used as a transparency tool to verify ownership.

BlackRock will continue to maintain traditional book-entry records as the official ownership ledger.

BlackRock didn’t propose a ticker or set a management fee for the DLT shares in its filing.

A minimum initial investment of $3 million worth of DLT is required for institutions seeking to purchase the digital shares.

BlackRock follows Fidelity’s March 21 filing to list an Ethereum-based OnChain share class, which seeks to track the Fidelity Treasury Digital Fund (FYHXX) — an $80 million fund consisting almost entirely of US Treasury bills.

While the OnChain share class filing is pending regulatory approval, Fidelity expects it to take effect on May 30.

Wall Street heavyweights continue to explore blockchain use cases

Asset managers have increasingly turned to blockchain to tokenize Treasury bills, bonds and private credit over the past few years.

The treasury tokenization market is currently valued at $6.16 billion, led by BlackRock’s BUIDL at $2.55 billion, while the Franklin Templeton-issued Franklin OnChain US Government Money Fund (BENJI) secures over $700 million worth of real-world assets, according to rwa.xyz.

Ethereum remains the chain of choice for tokenizing treasury assets, and currently houses over $4.55 billion worth, while the Stellar network and Solana round out the top three at $474.9 million and $274.5 million, respectively.

The potential of RWA tokenization has also been championed by BlackRock’s CEO, Larry Fink, who believes the technology could revolutionize investing.

Magazine: Ethereum is destroying the competition in the $16.1T TradFi tokenization race

Politics

US Treasury’s OFAC can’t restore Tornado Cash sanctions, judge rules

Published

6 hours ago

April 30, 2025

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US Treasury’s OFAC can’t restore Tornado Cash sanctions, judge rules

The US Treasury Department’s Office of Foreign Assets Control can’t restore or reimpose sanctions against the crypto mixing service Tornado Cash, a US federal court has ruled.

Austin federal court judge Robert Pitman said in an April 28 judgment that OFAC’s sanctions on Tornado Cash were unlawful and that the agency was “permanently enjoined from enforcing” sanctions.

Tornado Cash users led by Joseph Van Loon had sued the Treasury, arguing that OFAC’s addition of the platform’s smart contract addresses to its Specially Designated Nationals and Blocked Persons (SDN) list was “not in accordance with law.”

OFAC had sanctioned Tornado Cash in August 2022, accusing the protocol of helping launder crypto stolen by the North Korean hacking collective, the Lazarus Group.

The agency dropped the platform from the sanctions list on March 21 and argued that the matter was “moot” after a court ruled in favor of Tornado Cash in January.

This latest amended ruling prevents OFAC from re-sanctioning Tornado Cash or putting it back on the blacklist.

Initially, the court denied a motion for partial summary judgment and granted in favour of the Treasury. However, the Fifth Circuit reversed the decision and instructed the lower court to grant partial summary judgment to the plaintiffs, which led to the sanctions being revoked.

In March, the Treasury argued there was no need for a final court judgment in the lawsuit.

Crypto body petitions White House over Tornado Cash

On April 28, the DeFi Education Fund petitioned White House crypto czar David Sacks to have prosecutors drop charges against Tornado Cash co-founder Roman Storm.

Storm was charged in August 2023 with helping launder over $1 billion in crypto through the protocol, and his trial is still set for July.

The group said that the Department of Justice was attempting to hold software developers criminally liable for how others use their code, which they argued was “not only absurd in principle, but it sets a precedent that potentially chills all crypto development in the United States.”

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