Gibraltar Enters EU Customs Union and Schengen Area Following Brexit Negotiations
Historic agreement facilitates border crossings between Gibraltar and Spain as part of new EU relations post-Brexit.
On June 11, 2025, negotiators from the United Kingdom, Spain, and the European Union reached a significant agreement concerning Gibraltar's status following Brexit, marking a pivotal moment in the territory's relationship with the EU. This new arrangement, designed to enhance cross-border movement and streamline processes, will see Gibraltar join the EU's customs union and effectively become part of the Schengen area, eliminating passport controls at its borders with Spain.
The deal is set to benefit the approximately 15,000 people who commute between Gibraltar and Spain daily, as it abolishes the physical barriers and checks that have complicated travel since the UK's departure from the EU. EU Trade Commissioner Maroš Šefčovič, who announced the agreement, characterized it as a 'truly historic milestone' that will create a seamless transition for individuals and goods moving across the border.
The government of Gibraltar has long sought such an agreement, expressing concerns about the increasing difficulties at border crossings since Brexit, which have negatively impacted the lives of residents and daily commuters in the territory.
Spanish Foreign Minister José Manuel Albares commented on the deal, stating that it signifies the removal of 'the last wall on continental Europe,' fostering free movement for individuals.
As part of the agreement, Gibraltar will implement dual border controls at its airport alongside Spanish authorities, akin to existing arrangements at London’s Eurostar terminal.
This measure aims to uphold the integrity of the Schengen area while allowing Gibraltar to maintain control over its immigration policies.
The EU's oversight will involve Spanish law enforcement ensuring compliance with Schengen regulations.
The agreement includes provisions for Gibraltar to address taxation concerns, specifically related to its historically low tobacco taxes, as Spanish authorities stressed the need for 'tax convergence' to ensure fairness between local and cross-border businesses.
Despite establishing dual checks at border points, the accord contains clauses reinforcing Gibraltar's British sovereignty, a concern among UK Eurosceptics wary of perceived concessions.
UK Foreign Secretary David Lammy indicated that the prior administration's handling of negotiations had endangered Gibraltar's economic stability and way of life.
He emphasized that this new agreement presents a practical resolution after prolonged uncertainty.
Gibraltar’s Chief Minister, Fabian Picardo, expressed satisfaction with the deal, highlighting its importance for future generations of British Gibraltarians.
Officials from both parties will now work to finalize the legal framework for the agreement, with Šefčovič expressing confidence in its smooth ratification process.
The negotiations have drawn from earlier agreements, including the 2020 New Year’s Eve Pact, aimed at establishing new post-Brexit relations regarding Gibraltar.
The political consensus announced in Brussels resolves many long-standing issues related to Gibraltar’s legal status, allowing for a more stable and economically viable region.
This new framework includes commitments to mutual recognition of the legal jurisdiction over Gibraltar and involves cooperation among Spanish, British, and Gibraltar authorities in various sectors, including law enforcement, environmental policies, and economic development initiatives.
The elimination of the divisive border, often referred to as 'La Verja,' represents a transformative step for the region, promising improved connections not only for commerce but also for social integration between Gibraltar and neighboring Spain.
Economic concerns stemming from the absence of free movement across the border have been paramount, given Gibraltar's economic significance to the surrounding Campo de Gibraltar region, where a substantial portion of the local workforce is dependent on cross-border employment.
The negotiation of this agreement marks an important milestone in the evolving dynamic among the UK, Spain, and the EU, highlighting the continuing complexities surrounding sovereignty disputes and territorial governance that remain a legacy of Gibraltar’s historical context.
The deal is set to benefit the approximately 15,000 people who commute between Gibraltar and Spain daily, as it abolishes the physical barriers and checks that have complicated travel since the UK's departure from the EU. EU Trade Commissioner Maroš Šefčovič, who announced the agreement, characterized it as a 'truly historic milestone' that will create a seamless transition for individuals and goods moving across the border.
The government of Gibraltar has long sought such an agreement, expressing concerns about the increasing difficulties at border crossings since Brexit, which have negatively impacted the lives of residents and daily commuters in the territory.
Spanish Foreign Minister José Manuel Albares commented on the deal, stating that it signifies the removal of 'the last wall on continental Europe,' fostering free movement for individuals.
As part of the agreement, Gibraltar will implement dual border controls at its airport alongside Spanish authorities, akin to existing arrangements at London’s Eurostar terminal.
This measure aims to uphold the integrity of the Schengen area while allowing Gibraltar to maintain control over its immigration policies.
The EU's oversight will involve Spanish law enforcement ensuring compliance with Schengen regulations.
The agreement includes provisions for Gibraltar to address taxation concerns, specifically related to its historically low tobacco taxes, as Spanish authorities stressed the need for 'tax convergence' to ensure fairness between local and cross-border businesses.
Despite establishing dual checks at border points, the accord contains clauses reinforcing Gibraltar's British sovereignty, a concern among UK Eurosceptics wary of perceived concessions.
UK Foreign Secretary David Lammy indicated that the prior administration's handling of negotiations had endangered Gibraltar's economic stability and way of life.
He emphasized that this new agreement presents a practical resolution after prolonged uncertainty.
Gibraltar’s Chief Minister, Fabian Picardo, expressed satisfaction with the deal, highlighting its importance for future generations of British Gibraltarians.
Officials from both parties will now work to finalize the legal framework for the agreement, with Šefčovič expressing confidence in its smooth ratification process.
The negotiations have drawn from earlier agreements, including the 2020 New Year’s Eve Pact, aimed at establishing new post-Brexit relations regarding Gibraltar.
The political consensus announced in Brussels resolves many long-standing issues related to Gibraltar’s legal status, allowing for a more stable and economically viable region.
This new framework includes commitments to mutual recognition of the legal jurisdiction over Gibraltar and involves cooperation among Spanish, British, and Gibraltar authorities in various sectors, including law enforcement, environmental policies, and economic development initiatives.
The elimination of the divisive border, often referred to as 'La Verja,' represents a transformative step for the region, promising improved connections not only for commerce but also for social integration between Gibraltar and neighboring Spain.
Economic concerns stemming from the absence of free movement across the border have been paramount, given Gibraltar's economic significance to the surrounding Campo de Gibraltar region, where a substantial portion of the local workforce is dependent on cross-border employment.
The negotiation of this agreement marks an important milestone in the evolving dynamic among the UK, Spain, and the EU, highlighting the continuing complexities surrounding sovereignty disputes and territorial governance that remain a legacy of Gibraltar’s historical context.
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