UK Agrees Deal on Gibraltar’s Post-Brexit Future Amid Sovereignty Debate

The new agreement with the European Union aims to remove border checks and secure trade, but critics warn of Chagos precedent.

The Rock of Gibraltar stands behind La Linea de la Concepcion city in La Linea de la Concepcion, Spain on April 4, 2017. Pablo Blazquez Dominguez/Getty Images

A new UK–EU political agreement on Gibraltar has introduced a “fluid border” and a bespoke customs arrangement, ending four years of negotiations over the post-Brexit future of the British overseas territory.

At the core of the agreement, announced on Wednesday, is the removal of passport or customs checks at the Gibraltar–Spain border, maintaining the flow of around 15,000 cross-border workers daily.

Dual controls at the airport and seaport will allow for Schengen-compliant entry checks by Spanish officials, while Gibraltar retains its own immigration and policing authority.

The deal also introduces a bespoke customs arrangement. Goods will move freely between Gibraltar and the EU, while Gibraltar aligns its regulations with European rules on tobacco duties and indirect taxation.

Sovereignty Concerns

The agreement was jointly announced by Foreign Secretary David Lammy, Gibraltar’s Chief Minister Fabian Picardo, Spanish Foreign Minister José Manuel Albares, and EU Commissioner Maros Sefcovic.

The parties have agreed to a sovereignty clause confirming that the UK’s authority over Gibraltar remains unchanged.

Speaking in the House of Commons on Thursday, Lammy said the clause ensures there are “no questions” about Gibraltar’s sovereignty and its relationship with the UK.

The reassurance comes amid criticism following the UK’s recent decision to surrender sovereignty of the Chagos Islands to Mauritius.

Shadow foreign secretary Priti Patel said, “Gibraltar is British, and given Labour’s record of surrendering our territory and paying for the privilege, we will be reviewing carefully all the details of any agreement that is reached.”

Former Home Secretary Suella Braverman described the new deal as “another surrender and a handover in all but name.”

She warned that it could set a precedent, expressing concern that the Falkland Islands—another long-disputed British overseas territory—might be the next to come under pressure.

Long Road to Agreement

Negotiations over Gibraltar had been stalled since 2021, leaving it excluded from UK–EU Trade and Cooperation Agreement and exposed to the risk of a hard border under new EU entry rules.

The talks built on the New Year’s Eve Framework Agreement of 2020, which outlined a shared commitment to maintaining border fluidity and cooperation while respecting sovereignty.

The new deal now lays the political groundwork for a full treaty between the UK and the EU, which Lammy said the government will finalise “as quickly as possible.”

Picardo said the deal aligns “exactly” with what had been envisaged in the 2020 framework and backed by the people of Gibraltar.

“Now the deal is done, it’s time to finalise the Treaty,” he added.

The final treaty will be subject to full parliamentary scrutiny, with both UK and Gibraltar MPs given the opportunity to debate and examine its terms in detail.

Fiscal Control and Defence Safeguards

Under the terms of the deal, Gibraltar will continue to operate outside the UK’s and EU’s VAT systems and will retain its fiscal autonomy.

Lammy confirmed that the agreement does not compromise Gibraltar’s low-tax status.

On defence, the UK has reaffirmed its full operational control over all military assets in the territory.

The Strategic Defence Review identifies Gibraltar as a vital location at the western entrance to the Mediterranean. British forces, including the Royal Navy Gibraltar Squadron, the Royal Gibraltar Regiment, and RAF facilities, will remain fully under UK command.

Part of a Wider EU Reset

The government views the deal as another chance to “deepen” its ties with Spain and the European bloc as a whole.

It aligns with Labour’s broader push to reset relations with the EU, enhancing cooperation in trade, defence, and mobility, without reversing Brexit.

The agreement follows the UK–EU defence and trade deal, which proposed easing restrictions on food exports, improving travel access for young people, and allowing UK citizens to use eGates at EU airports again.

Lammy said that the Gibraltar deal would benefit both the economy and people on both sides of the border.

“It will be much more seamless on both sides,” he told MPs.

EU leaders called the agreement a “new chapter” in the EU–UK relationship, that will ensure “stability, legal certainty and prosperity for the region.”

PA Media contributed to this report.