Image: Andrew Parsons/ i-Images Image: Andrew Parsons/ i-Images

Boris Johnson has warned that the UK is in danger of becoming a vassal state, recently Andrew Marr suggested that this is precisely what Labour’s plans would entail. Others call such suggestions ideas from the school of cakeism.

The Foreign Secretary, Boris Johnson said:

“What we need to do is something new and ambitious, which allows zero tariffs and frictionless trade but still gives us that important freedom to decide our own regulatory framework, our own laws and do things in a distinctive way in the future.”

Writing in The Sunday Times, he said of government plans to mirror EU rules: “What is the point of what you have achieved?’ because we would have gone from a member state to a vassal state”.

Meanwhile, Sir Keir Starmer, The Shadow Secretary of State for Exiting the European Union appeared on the Andrew Marr show, where the genial host, who seems to give Brexit supporting politicians a much softer ride, described plans advanced by Labour and indeed the soft Brexit brigade as “copying and pasting” EU rules, with the UK becoming a “vassal state.”

So is that it? Is the UK in danger of becoming a vassal state to the EU?

Or are critics cakeists?

Admission time, there is no such word - at the moment. But when a made-up word keeps getting used, it can become a real word.

Cakeism dates back to the time of Henry VIII, from Thomas, Duke of Norfolk, who said in a letter to Thomas Cromwell, "a man can not have his cake and eat his cake".

But when a government document was found - ‘unintentionally leaked’ saying that the British plan, post-Brexit was to have our cake and eat it, cakeism took on a fresh perspective. Maybe Thomas Duke of Norfolk was wrong - you can have both.

The greatest barriers to trade are not tariffs or excise duties, they are regulations. Take as an example regulations scheduled for 2018. We set to see three very important regulations introduced into the EU: GDPR, which concerns protecting individual privacy, MiFID II, which relates to financial transparency and PSD2, which relates to open banking.

But, MiFID II regulations are not compatible with US financial regulations. Under MiFID II, banks and brokers cannot give away research reports for free as an inducement to trade with that organisation. As a result, we are likely to see the end of free research reports. In the US, companies that charge for research are subjected to much tighter regulation. Since MiFID II rules apply to all companies that trade in the EU, including US companies, it is almost impossible to be compliant with regulations on both sides of the Atlantic. As a result, US authorities are looking at changing rules to make them consistent with MiFID II. But no sensible person says that the US is becoming a vassal state.

For there to be international trade, there have to be rules that cross borders. There have to be common regulations to promote free trade.

Boris Johnson calls for free trade but different regulations, he is preaching the philosophy of cakeism.

To find out more about GDPR check out the next GDPR Summit London