Guernsey and Jersey are not part of the EU or the European Economic Area (EEA), but they are currently part of the EU Customs Union in accordance with Protocol 3 to the Act of Accession to the European Economic Community of 1972. Therefore, other than in relation to the free movement of goods and the requirement to treat all natural and legal persons from the EU in the same way as natural and legal persons from the UK, Guernsey and Jersey are already treated as jurisdictions outside of the EU and the EEA. In the event that the UK leaves the EU Customs Union as a result of Brexit, Guernsey and Jersey would also no longer be part of the EU Customs Union.

Guernsey and Jersey fall within the scope of the Withdrawal Agreement that has been agreed in principle by the UK and the EU. It is also expected that Guernsey and Jersey will fall within the scope of the Political Declaration on the framework for the future relationship with the European Union, which includes arrangements for market access for financial services under equivalence decisions under existing EU regulatory frameworks.

Irrespective of whether a deal is agreed between the UK and the EU on the terms of Brexit, the Common Travel Area arrangement that already exists between the UK, Ireland, Guernsey, Jersey and the Isle of Man will continue. The Common Travel Area is an open borders area that enables free movement of people within its borders with no, or minimal, identity documentation.

If a deal is not agreed between the UK and the EU on the terms of Brexit, it is intended that Guernsey and Jersey would seek for the UK's membership of the World Trade Organisation to be extended to them to enable certainty in the trade of goods for imports and exports with the EU and the rest of the world. Guernsey and Jersey are also committed to securing the rights of EU citizens already resident in the islands pursuant to arrangements that are similar to the EU Settlement Scheme that has been agreed by the UK.

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