This new agreement consists of several economic areas, including: 

• The negotiation of a new sanitary & phytosanitary (SPS) agreement 
• Energy & Climate change 
• Security and Defence. 

SPS Agreement 

The new sanitary and phytosanitary agreement is a beacon of hope, aiming to significantly reduce the administrative burden currently experienced by exporters and importers on both sides. The goal is to facilitate the movement of animal and plant products without the need for SPS checks. 

Following the initial uncertainty of Brexit, this area of SPS goods has caused businesses a significant amount of extra administrative work, with additional SPS checks now required for both exports and imports. The removal of these checks for goods moving into and out of the UK to and from the EU will significantly reduce the administrative burden on businesses, potentially leading to smoother trade operations. 

Energy & Climate Change 

The announcement of the retrospective Emissions Trading Schemes being linked is a significant step towards improved security for the energy sector. This will be particularly welcome news to UK businesses grappling with the EU CBAM, which comes into full effect in January 2026. The cooperation means not only improved security but also relieves the burden of the EU's Carbon Border Adjustment Mechanism (CBAM) on UK exporters, and subsequently, when it is implemented, the UK's CBAM on EU Exporters. 

Security & Defence 

A new Security and Defence Partnership was also announced, which will enable the defence industry to participate in the EU’s proposed new £150 billion Security Action for Europe (SAFE) defence fund. The UK, despite its exit from the EU, will be permitted to join in common procurements alongside Member States, ensuring interoperability with allies and contributing to cost reductions, thereby demonstrating the UK's commitment to European security. 

At a time of increasing global uncertainty and volatility, this will formalise UK-EU co-operation on defence to ensure Europe’s safety and security. 

Further details on how the agreement will work on a practical level are yet to be announced. Still, with the announcement that bilateral summits will be held annually at the Leaders' level, and the EU High Representative, as well as the UK Foreign and Defence Secretaries, meeting every six months, this is a much more pragmatic and fluid approach than has been sought previously. 

https://www.gov.uk/government/news/pm-secures-new-agreement-with-eu-to-benefit-british-people?utm_medium=email&utm_campaign=govuk-notifications-topic&utm_source=a6d00dda-138b-4403-af12-ce7ff1aaa38e&utm_content=immediately 

https://ec.europa.eu/commission/presscorner/detail/en/ac_25_1280