EU, UK Negotiators Agree On Text Outlining post-Brexit Relations

by Samuel Abasi Posted on November 22nd, 2018

Brussels, Belgium : The political declaration on the relationship between the UK and EU after Brexit “agreed in principle”, the European Council says. British and EU negotiators have agreed on a joint text outlining their goals for the future relationship after Brexit, European Council President Donald Tusk announced on Thursday.

The document now needs the political approval of the British government and the remaining 27 EU member states, who are holding a special Brexit summit in Brussels on Sunday.

“I have just sent to EU27 a draft political declaration on the future relationship between EU and UK. The commission president has informed me that it has been agreed at negotiators’ level and agreed in principle at political level, subject to the endorsement of the leaders,” Tusk wrote on Twitter.

The joint political declaration goes hand in hand with the withdrawal agreement, detailing Britain’s divorce terms. It covers joint future ambitions in areas covering trade, security and political cooperation, laying the groundwork for negotiations that can begin as soon as Britain has left the EU.

Officials described the future partnership as “ambitious, broad, deep and flexible.”

German Chancellor Angela Merkel cautioned, however, that there was still a lot of discussion to be had before the final withdrawal agreement was settled.

“I will do anything to support reaching an agreement,” Merkel said at a business summit in Berlin, with the caveat that “a disorderly exit would be the worst possible way both for the economy and the mental basis of our future relationship.”

“We have come a long way, but it will certainly still require a lot of discussion, especially within Britain,” she added.

Many observers have said it is unlikely the British Parliament will vote in favor of the Brexit 585-page deal British Prime Minister Theresa May presented last week leaving open the question of how a no-deal Brexit would affect both the UK and the EU. May will make a speech to Parliament later on Thursday.

May is also set to be with Austrian Chancellor Sebastian Kurz in London. Austria currently holds the rotating EU presidency, and Kurz said that his visit is meant to help the Prime Minister bolster support for her deal and get a realistic idea of how strong support for it is.

Why The Opposition To Brexit Is So Strong

The most important point about the draft Brexit withdrawal agreement is that, once it is ratified, the United Kingdom will have no legal route out of it unless the EU agrees to let the UK out and replace it with another agreement. This makes it unique among trade treaties (including the EU’s), which always contain clauses allowing each party to withdraw on notice. Politicians who claim that this is just a bad treaty — one we can get out of later — are being ignorant or disingenuous.

Halfway through the 585-page document,  Art. 185 states a Northern Ireland Protocol ‘shall apply as from the end of the transition period’. Once the Protocol is in force, the UK cannot leave it except by ‘joint’ decision of the UK and the EU. This gives the EU a right of veto over the UK’s exit. In agreeing to this clause, the government has caved in over seeking a right to leave.

Indeed, the Protocol — which has become known as the ‘backstop’ — locks the whole UK into a customs union with the EU with no decision-making power. Annex 2 Art. 3(4) states that the UK shall be ‘informed’ of any decision by the EU to amend the Common Customs Tariff ‘in sufficient time for it to align itself with that decision’.

The EU has a huge (£95 billion) surplus in goods trade with the UK. This customs union gives the EU tariff-free access for its export goods into the UK market. It also forces the UK to maintain the EU’s high tariffs against competing goods from other countries. As one might expect, this is more advantageous to EU exporters than the UK. It prevents the UK from lowering tariffs if it wants to in order to benefit it’s consumers. More importantly, it reduces the possibility of the UK forging trade deals with fast-growing economies around the world. They are not going to give the UK free trade in it’s services exports if it can’t offer concessions in return on their goods exports to the UK.

And since the EU can just sit back and force the UK into these terms by default, why on earth should it give the UK a better offer — namely the long-term trade deal that the government is banking on?

The government has negotiated a ‘political’ (i.e. not legally binding) declaration about the future relationship. This has the barest outline of possible terms. Only three pages deal with trade. These talk of zero tariffs between the EU and UK, but notably omit any commitment by the EU that the deal would allow the UK to set its own external tariffs, as in a Canada-style Free Trade Agreement, or even under the Prime Minister’s Chequers dual tariff customs plan — which she has repeatedly claimed would allow the UK to conduct an independent trade policy.

On the contrary, the declaration states that there will be ‘customs arrangements that build on the single customs territory provided for in the Withdrawal Agreement’. This means that the EU will not be under a legal obligation to agree a trade deal which allows the UK to conduct its own future independent trade policy.

Art. 184 says that the EU and the UK shall use their ‘best endeavours’ to negotiate a trade agreement in time for the end of the transition. The Conservative party chairman claims that this is ‘a high legal bar’ for the EU. But an obligation to try to agree is completely non-justiciable: you cannot pin the blame on either party if each pursues its own interests and a deal is not reached.

So the EU can easily slow down the negotiations — or just not agree to the kind of deal the UK wants. The UK will then be forced into the so-called backstop. Not only would this mean a customs union and onerous ‘level-playing-field’ obligations binding the whole UK, but also the annexation of Northern Ireland into the EU for laws relating to goods, customs procedures and taxes. The list of EU laws which will continue to apply runs to 68 pages alone — and that’s just the titles. Neither the UK Parliament nor the Northern Ireland Assembly would have any say over these laws or over changes to them by the EU in future.

The ‘transition’ period would see most EU laws continuing to apply in the UK, enforced as now by the Commission and adjudicated by the ECJ. The difference will be that under Art. 7 the UK is excluded from ‘the nomination, appointment or election of members of the institutions, bodies, offices and agencies of the Union, as well as the participation in the decision-making and the attendance in the meetings of the institutions’. The UK we will be required to abide by laws which it has no vote in shaping. There are no legally effective safeguards in the Agreement against the EU making changes to its laws which actively damage vital UK industries such as financial services.

The transition period was supposed to end in 2020, but the Prime Minister now envisages extending it to 2022. Art. 132 actually says that it can be extended up to ‘31 December 20XX’. The likely extension of the transition coupled with the very thin political declaration means that it could run indefinitely, prolonging the turmoil of the past 18 months and uncertainty about the future. During all this time the UK would be bound by EU law; it’s fishing industry subject to EU boats in our waters and quotas and rules imposed by Brussels.

The second big legal point about this draft treaty is that the European Court of Justice, whose influence Brexit was supposed to end, is given wide-ranging jurisdiction over the UK, not just during the ‘transition’ but afterwards as well. Once the UK leaves the EU, the ECJ will cease to be a multi-national court in which the UK is a participating member and will become an entirely foreign court. So why should the ECJ’s writ still run? Sovereign states generally never agree to be bound by the courts of the other treaty party. This is dictated by legal protocol and common sense. Even the agreements between the EU and the tiny landlocked states of Andorra and San Marino contain conventional bilateral arbitration clauses.

But not this agreement. A supposedly neutral ‘arbitration panel’ has been set up to decide general disputes between the UK and EU. But under Art. 175, disputed questions of EU law will be decided not by the panel but by the ECJ — and the panel will be bound by the ECJ’s ruling. So the ‘independent’ panel will simply act as a postbox for sending the dispute to the ECJ. And as a rubber stamp when the answer comes back.

This draft agreement  locks the UK down by throwing away in advance it’s two strongest negotiation cards: EU budget payments of £39 billion and the future access to our market for EU goods.

At present, the EU treaties give the UK the right to withdraw on two years’ notice — a right it is currently exercising. But this new deal would lock the UK in with no right to leave at all, and negate any benefits of the freedom of action which Brexit should bring.

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Samuel Abasi

Samuel Abasi

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