Minister Donohoe welcome agreement reached on Brexit Adjustment Reserve

17th June, 2021

The Minister for Finance, Paschal Donohoe, T.D., has welcomed the preliminary agreement reached today by the Council of the EU and the European Parliament for the Brexit Adjustment Reserve.

Agreement on the draft regulation came after a single round of trilogue negotiations between the Council of the EU and the European Parliament and European Commission.

  • Speaking in Luxembourg, the Minister for Finance, Paschal Donohoe said: ‘It is very welcome that agreement on the Brexit Adjustment Reserve was reached so swiftly with the European Parliament. This underlines the importance of the Brexit Adjustment Reserve as an instrument to support Member States in managing the impact of Brexit. The significant allocation of this Special Instrument to Ireland recognises the disproportionate impact of Brexit on key sectors. With today’s agreement we are much closer to funds being disbursed before the end of 2021 and that is most welcome. I want to thank the Portuguese Presidency of the Council for steering the discussions on the BAR to a successful conclusion’.

The next steps in finalising the process requires that the preliminary agreement between the Portuguese presidency of the Council and negotiators from the European Parliament must be endorsed by the two institutions, before they can proceed to adoption of the regulation. This is expected to take place very soon. Under the proposal, Ireland will be allocated over €1 billion of the available €5.34 billion (€5 billion in 2018 prices).





The Brexit Adjustment Reserve is a special one-off emergency instrument. It will be spent on, among other things, compensating businesses for lost trade, preserving jobs, helping fishing communities, and building customs facilities at ports.

The main condition for reimbursing public authorities as well as private companies is that the costs incurred must be directly linked to countering the adverse effects of the UK’s withdrawal.

The co-legislators agreed that the reserve will cover in full or in part measures introduced by member states between 1 January 2020 and 31 December 2023. This time frame takes into account the need for mitigating actions before the expiry of the transition period.



The full €5 billion (in 2018 prices, €5.34 billion in current prices) will be provisionally allocated to Member States in advance.

Of the total amount (€5 billion in 2018 prices):

80% or €4 billion will be disbursed as pre-financing: €1.6 billion in 2021, €1.2 billion in 2022 and €1.2 billion in 2023.
20% or €1 billion will be made available in 2025. It will be shared among Member States depending on how the funding has been spent in the previous years, also taking into account any unused amounts.



Brexit has an uneven impact on member states, regions and sectors. Bearing this in mind, the co-legislators agreed that the allocation method should be based on three main factors:

the value of fish caught in the UK exclusive economic zone
the importance of trade with the UK
the population of maritime border regions with the UK

Overall, €600 million will be allocated on the basis of the factor linked to fishing, €4.150 billion based on trade, and €250 million under the factor linked to maritime border regions.

Ireland is expected to benefit from over €1 billion of the available €5.34 billion (€5 billion in 2018 prices).