Neither the agreement nor the political declaration gives any indication of the future relationship in terms of choice of law, freedom of decision and recognition and enforcement of judgments. The UK has already hinted that it hopes to agree on a large-scale agreement, broadly in line with the current position. The withdrawal agreement provides for a transitional period until 31 December 2020, during which time the UK will remain in the internal market, to ensure the smooth flow of trade until a long-term relationship is concluded. If no agreement is reached by then, the UK will leave the single market without a trade deal on 1 January 2021. The withdrawal agreement is closely linked to a non-binding political declaration on future relations between the EU and the UK. The revised agreement has fewer tax obligations than in its previous version. It states that the parties adhere to the principles of good fiscal governance and the fight against harmful tax practices. However, there is no reference to the Code of Conduct for Corporate Taxation (which was published in the previous version). The political declaration specifies that the contracting parties envisage mutual recognition of the programmes of trusted economic operators, administrative cooperation in customs and VAT and mutual assistance, including the collection of tax and tax debts, and the exchange of information to combat customs fraud and VAT fraud and other illegal activities.
The provisions in the Policy Declaration on the Fair Competition, under which future relations must ensure open and fair competition, include the obligation for the parties to comply, at the end of the transition period, with the high common standards in place in the EU and the United Kingdom in areas covered by `relevant tax issues`. There is a specific protocol on Gibraltar, which provides for an agreement between the UK and Spain to cooperate in full transparency of tax issues in order to combat fraud, smuggling and money laundering and to resolve disputes between tax residences.