Prolonging the acquis: a blueprint for the Brexit transition

In a report published this week Piet Eeckhout and Oliver Patel assess the options for a Brexit transitional arrangement. They argue that the most realistic option is for the full body of EU law to continue to apply in the UK, while the UK simultaneously ceases to be an EU member state. The report’s conclusions are summarised here.

They may not see eye to eye on the big issues such as trade and migration, but Theresa May and EU leaders may be closer than you think to agreeing the terms and scope for a transition period. If the latest reports are correct, the prime minister may be about to double her offer on the financial settlement to £38bn in order to unblock the talks before the European Council summit on 14 December.

If she does, she has a realistic route to a deal on the transition. Indeed, the blueprint for a transition period that we advocate as the most viable – where the UK gives up its membership but accepts EU laws lock, stock and barrel – is the one that they are actually edging towards.

You just have to look at May’s Florence speech, in which she made clear that the UK seeks a transition where ‘access to one another’s markets should continue on current terms’, i.e. nothing changes. She even accepted that the framework for this period would be ‘the existing structure of EU rules and regulations’, with David Davis confirming in his speech last Thursday to German business leaders that the UK wants to remain in all EU regulatory agencies during the transition. Similarly, the EU has also indicated that it would accept a status quo transition, but this would require ‘existing union regulatory, budgetary, supervisory, judiciary and enforcement instruments and structures to apply’.

An extension of the EU acquis communautaire (the full body of EU law) to the UK, while the UK simultaneously ceases to be an EU member state, is the obvious choice for the post-Brexit transition. This is for three reasons. First, it’s comprehensive, meaning that very little changes on Brexit day, and a cliff-edge is avoided. Second, it’s relatively straightforward from a legal perspective, at least compared with the other options. The Article 50 withdrawal agreement could be the legal basis, meaning it would require approval only from a qualified majority of the European Council and the European Parliament, but not member state parliaments. It’s simpler than the UK re-joining the EEA Agreement via EFTA or crafting an EEA copycat agreement. The former would require treaty amendment and the approval of member state parliaments, while the latter would require bespoke institutional mechanisms for dispute settlement and enforcement to be set up. Third – and perhaps most importantly – it’s politically feasible.

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Now that Article 50 has been triggered, reality will start to bite

Following the triggering of Article 50, the honeymoon period is over for Theresa May. Oliver Patel outlines the main challenges which the UK faces in the upcoming negotiations. He argues that securing a deal within the two period will be hard enough. Securing a deal which pleases everyone – or anyone at all – will be virtually impossible.

Theresa May has had an easy ride so far. Up until now, she has only had to worry about pleasing her core domestic audiences. Now that Article 50 has been triggered, however, reality will start to bite. The two-year road to Brexit is fraught with uncertainty, obstacles and challenges. Two stand out above all else. First, given the complexity of the task, two years is an extremely short length of time in which to negotiate and finalise the UK’s withdrawal. Second, getting a deal which satisfies everyone – the British public, the EU and its 27 member states – will be virtually impossible. Theresa May needs to negotiate with 27 other countries, each with their own interests and priorities, who arguably have the upper hand in the talks. Her task is an unenviable one.

Is two years enough?

The triggering of Article 50 marks the beginning of a two-year process in which the UK and the EU must negotiate and conclude a withdrawal agreement. From May onwards, after the European Council have agreed upon official negotiating guidelines, the negotiations can begin in earnest. If no deal is reached within two years, the UK leaves without an agreement (unless the EU unanimously decides to extend the negotiations). Two years is a remarkably short length of time in which to complete what is routinely described as the most complex task undertaken by the British government since World War II. EU leaders have made it clear that they want the negotiations to end in October 2018, to allow time for any withdrawal agreement to be reviewed and ratified. This means that the UK could have no more than 18 months to negotiate its exit.

This short timeframe makes the entire process particularly challenging. Sorting out the practical aspects of the divorce will be complex in the extreme. Resolving thorny issues such as the Irish border, the status of EU nationals in the UK and UK nationals in the EU, the future participation of the UK in EU regulatory bodies, and the financial liabilities which the UK owes the EU, will be highly time-consuming, not least due to the complexity and contestability of the issues involved.

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Experts take centre stage at UCL EU referendum debate

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On Thursday 16 June the Constitution Unit hosted the last in a series of events relating to the referendum on the UK’s EU membership. The murder of Jo Cox and subsequent suspension of referendum campaigning meant that the planned format had to be changed, with an expert panel rather than politicians taking centre stage. Despite this around 600 people attended and contributed greatly to a lively discussion that covered a very wide range of topics relating to the referendum. Oliver Patel reports.

Over the past few months, the Constitution Unit has hosted a series of seminars and published a number of briefing papers on the constitutional consequences of Brexit. We have organised these jointly with the UCL European Institute and UCL School of Public Policy, with funding from the UK in a Changing Europe initiative based at King’s College London.  As part of the series, we gathered a range of experts to discuss the potential impact of Brexit on Whitehall and Westminster, the devolved nations and the rest of the EU. All of our videos and briefing papers can be found here. Thursday 16 June marked the end of this series as we held our largest event to date: The UCL EU Referendum Debate.

Following the tragic murder of Jo Cox and the subsequent suspension of activity by both the Leave and the Remain campaigns, we changed the event’s format. We had planned a debate among politicians, with a panel of academic experts ‘fact-checking’ their claims. This changed on the night to a ‘Meet the Experts Q&A’, with the academics taking centre stage. Around 600 people attended, and many had the chance to put referendum-related questions to the panel.

The panellists were Dr Swati Dhingra (Lecturer in Economics at LSE), Professor Anand Menon (Director of the UK in a Changing Europe initiative), Dr Alan Renwick (Deputy Director of the Constitution Unit), and Dr Simon Usherwood (Senior Lecturer in Politics at the University of Surrey). The event was chaired by the Director of the Constitution Unit, Professor Meg Russell.

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Post-Brexit trade negotiations would pose significant practical challenges for Whitehall

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The implications of Brexit for the UK’s trade arrangements, a subject on which Leave and Remain campaigners have sharply disagreed, were addressed in the first two seminars of a series on Brexit hosted by the Constitution Unit and the UCL European Institute. Drawing on the comments of the seminar speakers, Oliver Patel discusses the impact that post-Brexit trade negotiations would have on Whitehall and the EU. Whitehall, in particular, would face a number of practical difficulties. Though not insurmountable, these mean that the process of negotiating new trade deals would be far from straightforward.

All of a sudden, everyone is talking about trade deals. The EU referendum Leave campaign argue that outside the EU the UK will prosper as it will be able to negotiate favourable trade deals with growing economies like India and Australia. Remain campaigners argue that this will not be easy and that being in the EU gives us more clout. Their cause was boosted by Barack Obama’s claim that the UK would have to join the back of queue if it wanted its own trade deal with the US.

Our first Brexit seminar and associated briefing paper assessed the impact of Brexit on Whitehall and Westminster. The panel agreed that the process of withdrawing from the EU would cause major headaches for Whitehall. This is primarily because of the various international negotiations which the UK would subsequently have to engage in, such as a withdrawal agreement with the EU and new free trade agreements with non-EU countries.

Sir Simon Fraser, former Permanent Under-Secretary at the Foreign and Commonwealth Office (FCO), noted that the UK government currently employs very few (if any) trade negotiators, as the function has long been outsourced to Brussels. He concluded that the practical challenge of negotiating multiple international agreements in the event of Brexit – whilst also managing the ongoing business of government – would be huge. However, he does not view the challenge as insurmountable, so long as Whitehall increases capacity and expertise in key areas and co-ordinates the process effectively.

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