Extending Brexit may be needed despite EU deal hopes

Subject Final stages of Brexit negotiations. Significance There has been much talk of the possibility of extending the Article 50 process to allow more time for further negotiations, and possibly a second referendum or a general election. With under 150 days to go until the United Kingdom is due to leave the EU, there is much debate about the circumstances under which a delay might be required and, if so, how it could be achieved. Impacts A new government may use an extended transition period to change or prevent Brexit. Calls of a second referendum will deeply polarise UK political opinion. The EU could decide to block an extension to the transition, heightening fears of a no-deal Brexit.

Subject The package of reforms on a new EU-UK relationship. Significance The agreement between the United Kingdom and its EU partners sets the stage for the UK referendum on EU membership, which Prime Minister David Cameron has set for June 23. Cameron said he had negotiated new terms that would allow the United Kingdom to remain in the EU. Impacts The deal bolsters the campaign to remain in the EU, but the referendum outcome is still highly uncertain. The deal will only come into effect if the outcome is for remaining, forestalling a second referendum for better terms. If the outcome is for leaving, a new relationship with the EU would have to be negotiated during a two-year transition period. It would also probably lead to a second Scottish independence referendum and UK break-up.


Significance This followed a landmark speech on January 17 in which she added more clarity and detail to her previous stance on the United Kingdom’s departure from the EU. May indicated a willingness to leave the single market, strongly implied that the United Kingdom would not be part of the customs union in its current form and asserted that she would rather quit the EU with no permanent or transitional deal agreed than accept an arrangement which limited the United Kingdom’s future freedom of action. Impacts The government is likely to meet its preferred timetable for triggering Article 50 even if it has to obtain approval from parliament. The United Kingdom will probably lose its passporting rights, which allow UK-based banks to sell their products across the EEA. Paris and Frankfurt will probably benefit as banks may seek to move some of their staff out of London.


Significance This comes after the Telegraph reported last week that Soros had donated 400,000 pounds to the group. There is an ongoing debate as to whether the United Kingdom will in fact leave the EU. Central to it is the question of whether the UK government can unilaterally revoke its decision to trigger Article 50 in March 2017. Impacts Voters would be less likely to support the revocation of Article 50 if the Council imposed conditions that made membership less attractive. Revoking Article 50 and remaining in the EU would reduce damage to the UK economy. If Article 50 is revocable, Eurosceptic governments could be tempted to use the prospect of triggering it as leverage in EU negotiations.


Significance The process has been plunged into further uncertainty by the outcome of the June 8 UK general election, which has sparked renewed debate about what kind of Brexit the United Kingdom wants and what kind of future economic relationship with the EU it should seek to negotiate. Impacts The UK government’s weakness is a cause for concern elsewhere in the EU, raising fears that it may not be able to compromise on key issues. Many businesses will begin implementing strategies for dealing with Brexit early next year, before knowing the outcome of the negotiations. Pressure for a lengthy transition period will continue to build. The political turmoil and slowing economic growth in the United Kingdom may increase support for EU membership elsewhere in the bloc.


Subject UK-EU trade talks. Significance The United Kingdom will leave the EU on January 31, 2020, but will abide by EU rules as part of the transition period, which runs to December 31, 2020. During this limited period of time, London and Brussels will seek to negotiate a permanent trading relationship. While the transition deadline can be extended, the UK government has committed not to seek an extension. Impacts The impact of no trade deal or a 'thin' one may force the UK government to increase taxes in order to meet spending pledges. UK financial services will rely on an equivalence deal with the EU; London hopes to agree this by mid-2020. The EU’s future trade policy will focus on having stronger sanction powers as well as legal ones for those that unfairly undercut EU firms.


2016 ◽  
Vol 12 (03) ◽  
pp. 409-444 ◽  
Author(s):  
Michael Gordon

The United Kingdom 2016 referendum on membership of the European Union – challenges of pursuing the decision to withdraw – challenges for the UK constitution in commencing, executing, concluding, and legitimising EU withdrawal – domestic constitutional requirements for triggering Article 50 TEU – roles of UK government, UK Parliament, and devolved institutions in Brexit – a second referendum or a national general election on withdrawal terms – exiting the EU as a challenge of the UK’s political constitution – Brexit as exposing limitations of the UK’s current constitutional arrangements and architecture – Brexit as an unprecedented event and the centrality of politics – constitutional factors contributing to the outcome of the referendum – concerns about sovereignty and the (im)possibility of a national response – potential implications of the referendum for the UK and for the EU


Significance European leaders are hoping for the best but preparing for the worst as they await negotiations on the United Kingdom's departure from the EU. A chaotic exit has not been ruled out, although cooler heads are likely to prevail eventually. Impacts The first months after Article 50 is invoked will be dominated by technical aspects; political negotiations may not begin before 2018. UK failure to take sufficient account of domestic politics in other EU member states is likely to be an obstacle in the negotiations. Governments under pressure from populist parties will be keen to ensure that the United Kingdom is not seen as better off after it leaves.


Significance A rejection of the deal would increase momentum for a second referendum, especially if it becomes the only means of avoiding a no-deal Brexit. Impacts If it revoked Article 50, the United Kingdom would be able to re-enter the EU on the same terms they had prior to the referendum. Some businesses may delay or postpone plans for relocation. A second vote would result in parliamentary division over issues such as the date of the referendum and what questions should be asked.


Subject The future of Irish-UK relations. Significance Brexit has deeply unsettled relations between Ireland and the United Kingdom, after a generation in which the two states and peoples grew closer in terms of trust, policy convergence and openness to each other. As London looks to strengthen its global influence, closer to home, historical tensions look set to resurface in some form, especially regarding mutual trust and affairs in Northern Ireland. Impacts MI5 will strengthen its operations in Northern Ireland in the event of a hard border. As one of the few common-law countries in the EU after Brexit, Ireland will attract greater legal investment. Once phase one of the Brexit talks are complete, Ireland’s minority government will be forced to call a general election.


Significance Johnson's cabinet overhaul is the largest in decades, replacing 17 cabinet ministers from the previous government mostly with individuals who support Johnson’s hard-line stance on Brexit. Impacts Brussels could offer London a ‘Northern Ireland only’ backstop, but this will be rejected by the UK government. The government will likely pass legislation to protect EU citizens’ rights in the United Kingdom if there is a no-deal Brexit. The EU will only grant another extension if a deal is almost agreed, or if there is a UK general election or second Brexit referendum.


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