SCOTTISH ministers are reportedly considering the possibility of adopting the Norwegian model for post-Brexit Scotland, allowing free trade and free movement of people with the rest of Europe while remaining in the UK.

It would, however, require the UK Government to devolve powers over finance and immigration to the Scottish Parliament, something Theresa May will likely resist.

The Scottish Government says it will publish proposals that would allow Scotland to remain a member of the single market in the coming weeks.

But according to reports on the BBC, one of the options St Andrew’s House is looking at is for Scotland to become part of the European Economic Area (EEA), which includes the existing EU states, plus Iceland, Liechtenstein and Norway.Norway has full access to the single market but has to contribute to the budget in Brussels and accept most EU laws.

In return, Norwegians have free movement across the EU. And while they are exempt from EU rules on agriculture, fisheries, justice and home affairs, they have no say over how the rules of the single market are created.

Last month in the Financial Times, the economist, writer and founder of Norwegian think tank Liberalt Laboratorium, Martin Sandbu, said Scotland in the EEA and the European Free Trade Area (Efta) could be the solution that meets the demands of both May and Nicola Sturgeon.

“It would involve Scotland complying with all present and future EU legislation on single market rules [except for fish and farming], maintaining the free movement of EU citizens to Scotland, and vice versa, and probably a membership fee. It would also require submitting to adjudication by the Efta court,” he wrote.

Such a position would mean no need for a customs border between Scotland and England when the UK itself leaves the customs union, he argues.

He goes on to say: “Scottish EEA membership would pose no obstacle to UK border controls as at present, nor any threat to passport-free travel between Scotland and England.”

The only challenges would be “practical, constitutional and political” as it requires the UK to devolve immigration policy over EU citizens to Scotland.

“It would mean Scotland could give Europeans the right to live and work in Scotland, without this giving any right to live and work elsewhere in the UK. Of course, those Europeans could then physically cross into the rest of the UK without controls — but that is no different from the common travel area with Ireland,” he writes.

It would also mean Scotland complying with EU financial regulation, requiring a devolved regulatory regime, creating a different playing field for banks north of the border and the rest of the UK. This, he claims, could see the financial industry move from London to Edinburgh, and retain its “passports” into the single market, but argues this would be better for the UK than “if financiers decamp to Dublin or Frankfurt”.

The biggest obstacle would be “constitutional,” he concludes, “but if there is a will there is a way. If politicians across the UK and Europe would only recognise a sorely needed constellation of aligned interests when they see one, they could put the lawyers to work without delay.”

Scottish Conservative finance spokesman Murdo Fraser said the SNP “know full well the EU would not allow Scotland to have a separate deal in the first place when the precedent that would set would go directly against the interests of some member states.”

“If the SNP’s plan is to back a ‘Norway-style’ deal for Scotland, that would erect a hard border between us and England, our largest market.”


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