Members' Research Service By / May 19, 2021

Brexit adjustment reserve [EU Legislation in Progress]

The European Commission adopted a proposal for a regulation on the Brexit adjustment reserve on 25 December 2020.

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Written by Christiaan van Lierop (2nd edition, updated on 15.7.2021),

© ktsdesign / Adobe Stock
© ktsdesign / Adobe Stock

As part of the preparations for the United Kingdom’s withdrawal from the European Union, the European Council agreed in July 2020 to create a Brexit adjustment reserve within the special instruments outside the budget ceilings of the European Union’s multiannual financial framework, with a budget of €5 billion to counter unforeseen and adverse consequences in Member States and sectors that are most affected. The Commission adopted a proposal for a regulation on the Brexit adjustment reserve on 25 December 2020. The reserve will support public expenditure incurred by Member States from 1 January 2020 to 31 December 2023 for eligible measures, which include support for affected sectors, training, and new border facilities. Funding will be available for all Member States, distributed in several allocation tranches, with 80 % of the resources due to be allocated to Member States in the form of pre-financing, to be disbursed in 2021, 2022 and 2023, and the remainder to be made available in 2025, where applicable. Each country’s allocation is calculated based on the importance of its trade with the UK and, where applicable, its dependence on fisheries in UK waters and the size of the population of maritime border regions with the UK. In the European Parliament, the file was assigned to the Committee on Regional Development, which adopted its report on 25 May 2021. A final political trilogue meeting took place on 17 June 2021, confirming the political agreement reached between the Council and Parliament. That agreement now needs to be formally adopted in plenary, expected in September 2021, and then by the Council


Proposal for a regulation of the European Parliament and of the Council establishing the Brexit adjustment reserve
Committee responsible: Regional Development (REGI) COM(2020) 854 final 25.12.2020

Pascal Arimont (EPP, Belgium)

2020/0380 (COD)
Shadow rapporteurs: Tsvetelina Penkova (S&D, Bulgaria) Irène Tolleret (Renew, France) François Alfonsi (Greens/EFA, France) Raffaele Fitto (ECR, italy) Martina Michels (The Left, Germany) Ordinary legislative procedure (COD) (Parliament and Council on equal footing – formerly ‘co-decision’)
Next steps expected: Final first-reading vote in plenary

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