Brexit - the Withdrawal Agreement

On 23rd June 2016, the "will of the people" in the UK, as decided in the Referendum, was that the United Kingdom should leave the European Union.  David Cameron resigned as Prime Minister on 24th June 2016, and after the ensuing Conservative Party leadership election campaign, Theresa May was appointed party leader on 11th July 2016, and Prime Minister on 13th July.  It would be her responsibility to implement the withdrawal of the UK from the EU.  She had been a supporter of Remain, and in her new cabinet, she gave two key posts to high profile Leave supporters: Boris Johnson was made Secretary of State for Foreign and Commonwealth Affairs (Foreign Secretary), and David Davis Secretary of State for Exiting the European Union.  

It took some time to initiate the process to withdraw the UK from the EU.  There was a question over whether the Government could just go ahead and notify the EU that the UK was leaving, or whether that needed to be approved by Parliament.  The withdrawal clause (article 50) in the Treaty on European Union had been introduced in the 2009 Treaty of Lisbon and did not help as it said "Any Member State may decide to withdraw from the Union in accordance with its own constitutional requirements".  A legal case went to the UK courts (R.Miller versus Secretary of State for Exiting the European Union) eventually making it to the Supreme Court which decided on 24th January 2017 that the Government could not initiate the process to leave the EU without an Act of Parliament approving this.  So on 26th January 2017, the Government put forward the European Union (Notification of Withdrawal) Bill, which just said "The Prime Minister may notify, under Article 50(2) of the Treaty on European Union, the United Kingdom’s intention to withdraw from the EU."  This was approved and given Royal Assent on 16th March 2017, becoming the European Union (Notification of Withdrawal) Act 2017.  Prime Minister Theresa May signed a letter which was handed to the President of the European Council Donald Tusk on 29th March 2017 which invoked Article 50 of the Treaty on European Union and started the withdrawal process.  This meant that the UK was due to leave the EU before midnight on 29 March 2019, UK time, when the two-year period for Brexit negotiations expired.

On 2nd February 2017, the Government published the White Paper "The United Kingdom’s exit from and new partnership with the European Union" which set out the basis for the following 12 principles to guide the negotiations for the withdrawal from the EU:

1. Providing certainty and clarity - We will provide certainty wherever we can as we approach the negotiations.
2. Taking control of our own laws - We will take control of our own statute book and bring an end to the jurisdiction of the Court of Justice of the European Union in the UK.
3. Strengthening the Union - We will secure a deal that works for the entire UK - for Scotland, Wales, Northern Ireland and all parts of England. We remain fully committed to the Belfast Agreement and its successors.
4. Protecting our strong and historic ties with Ireland and maintaining the Common Travel Area - We will work to deliver a practical solution that allows for the maintenance of the Common Travel Area, whilst protecting the integrity of our immigration system and which protects our strong ties with Ireland.
5. Controlling immigration - We will have control over the number of EU nationals coming to the UK.
6. Securing rights for EU nationals in the UK, and UK nationals in the EU - We want to secure the status of EU citizens who are already living in the UK, and that of UK nationals in other Member States, as early as we can.
7. Protecting workers’ rights - We will protect and enhance existing workers’ rights.
8. Ensuring free trade with European markets - We will forge a new strategic partnership with the EU, including a wide reaching, bold and ambitious free trade agreement, and will seek a mutually beneficial new customs agreement with the EU.
9. Securing new trade agreements with other countries - We will forge ambitious free trade relationships across the world.
10. Ensuring the UK remains the best place for science and innovation - We will remain at the vanguard of science and innovation and will seek continued close collaboration with our European partners.
11. Cooperating in the fight against crime and terrorism - We will continue to work with the EU to preserve European security, to fight terrorism, and to uphold justice across Europe.
12. Delivering a smooth, orderly exit from the EU - We will seek a phased process of implementation, in which both the UK and the EU institutions and the remaining EU Member States prepare for the new arrangements that will exist between us.

Section 8 quite clearly stated that the Government would not be seeking to remain in the Single Market: "The Government will prioritise securing the freest and most frictionless trade possible in goods and services between the UK and the EU. We will not be seeking membership of the Single Market, but will pursue instead a new strategic partnership with the EU, including an ambitious and comprehensive Free Trade Agreement and a new customs agreement."  The White Paper ended with a conclusions section, which opened with the following paragraph: "The Government has made clear that we will honour the choice that the people of the UK made on 23 June 2016; the UK will leave the EU. We will seek an ambitious future relationship with the EU which works for all the people of the UK and which allows the UK to fulfill its aspirations for a truly global UK."

On the 18th April 2017, Prime Minister Theresa May announced that she would be seeking a General Election on 8th June 2017, one of the reasons being that she needed a majority for the Brexit negotiations.  She did have an existing small majority, but was hoping to be returned to power with a larger one.  Under the Fixed-term Parliaments Act 2011, she needed a two-thirds majority vote in Parliament to allow this, and a House of Commons motion was passed on 19th April with a massive majority (522 for, 13 against).  Parliament was dissolved on the 3rd May so that the campaigning could take place.  Despite regular predictions that the Conservatives would win with an increased majority, the result was that, although they were still the largest single party, the Conservatives were short of a majority.  Theresa May continued as leader and formed a minority government with the support of the Democratic Unionist Party (DUP) giving them a "majority" on votes in the House of Commons.

Withdrawal negotiations with the EU formally started on 19th June 2017 when David Davis went to Brussels to meet with Michel Barnier, the Chief Negotiator appointed by the European Commission.  They began the process of developing and agreeing the Withdrawal Agreement, including the terms for a transitional period, and the Political Declaration setting out the framework for the future relationship between the UK and the EU.  This would continue until November 2018.

In order to leave the EU, the UK would have to repeal the European Communities Act 1972, so the Government published the European Union (Withdrawal) Bill on 13th July 2017.  This was given Royal Assent on 26th June 2018 becoming the European Union (Withdrawal) Act 2018.  It is worth looking at some of the main points in the Act:

• The European Communities Act 1972 will be repealed on exit day, removing the supremacy of EU law over UK law.
• Existing EU laws will be carried over into UK law on exit day (Retained EU laws), corrected where necessary to be consistent with the UK not being in the EU.
• The EU Charter of Fundamental Rights is an exception to this and will not be carried over into UK law.
• EU laws passed on or after exit day will not apply in the UK.
• UK courts will not be bound by principles laid down or decisions made by the European Court on or after exit day.
• Ministers must act in a way compatible with the terms of the Northern Ireland Act 1998.
• This does not authorise regulations which (i) diminish North-South cooperation provided for by the Belfast Agreement 1998, or (ii) create a hard border between Northern Ireland and the Republic of Ireland.
• The Withdrawal Agreement negotiated with the EU must be approved by the UK Parliament.
• Further Acts of Parliament will then be required to implement the approved Withdrawal Agreement.

So to avoid having holes in its laws, the UK is carrying over all relevant EU laws into UK law on exit day, and then will execute future legislation to modify those laws as required.  However, it is not carrying over the EU Charter of Fundamental Rights into UK law.  I can see no reasonable argument for why this would be excluded?  I have suspicions that the Conservative Government might think it better for businesses if the UK does not have such a charter enshrined in law as there are sections on rights of workers.  This would actually contradict with principle 7 in the Government's White Paper "The United Kingdom’s exit from and new partnership with the European Union", but they would probably argue its omission is part of the exercise to "get rid of red tape".

It is also worth noting that further legislation would be needed to implement an approved Withdrawal Agreement. This is significant to the current situation where the UK Parliament has passed an Act to try and avoid a no-deal exit.  It would be possible for Prime Minister Boris Johnson to get a Withdrawal Agreement approved by Parliament by 19th October 2019, so avoiding having to write to the EU asking for an extension, but then not enact the subsequent legislation needed to implement the Withdrawal Agreement, which would result in us crashing out of the EU without a deal on 31st October 2019.  If he was to do this, and it would require some underhand voting in Parliament to achieve it, then it would surely prove that he never really had any intention of negotiating a new deal and has always been trying to achieve the no-deal exit.  Later, we will look further at why anyone would want this.

For the previous two sessions of Parliament, there had been a Commons Select Committee "Exiting the European Union Committee".  Its membership for the 2017 Parliament was confirmed on 12th September 2017.  It was chaired by Hilary Benn MP, its role was "to examine the expenditure, administration and policy of the Department for Exiting the European Union and matters falling within the responsibilities of associated public bodies", and it published regular reports on the progress of the withdrawal negotiations.  If interested, these can be reviewed to follow in detail how the negotiations progressed but we will only look at a few key points here.  

Negotiations continued through 2018.  On 29th January 2018, the European Council adopted and published further negotiating directives, stating that the rights and obligations binding EU member states would continue to apply to the UK during the proposed transition period, and that the UK would remain in the customs union and single market for that period, while no longer participating in EU decision-making.  Since the transition period was believed to be at least two years, this did not go down well with the Leave supporters.  During March 2018, despite issues with respect to the Irish border, the Withdrawal Agreement was believed to be about "75% agreed".

The Government published the Chequers Plan on 12th July 2018, which laid out the type of future relationship between UK and EU that the UK sought to achieve.  Brexit Secretary, David Davis, and Foreign Secretary, Boris Johnson, resigned in opposition to the plan.  Dominic Raab was appointed as the new Secretary for Exiting the European Union, replacing David Davis.  The Chequers Plan was rejected by the EU in September 2018 because the UK wanted to have the benefits of the Single Market without actually being in it with the ensuing obligations - free movement of people, etc.

From July to October 2018, further discussions took place trying to resolve the UK-EU trade deal and the issue with the Irish border.  The two key Irish border requirements, to avoid a hard border between Northern Ireland and Ireland, and to protect the EU Single Market from the UK once it had left, were incapable of both being met by any known solution.  As an interim solution, which would only come into play if there was no satisfactory border solution in place by the end of the transition period (so called the Backstop), it was proposed that Northern Ireland would stay in the Single Market and Customs Union,  However, the DUP were not happy with this as it would mean Northern Ireland being treated differently from the rest of the UK, with a customs border between Northern Ireland and the rest of the UK, and they saw that as the first step towards a united Ireland.  So the solution was modified to be the whole of the UK would stay in the EU Customs Union, and Northern Ireland would stay in some aspects of the Single Market until the solution was found to prevent a hard border. This later became a major sticking point that would prevent approval of the Withdrawal Agreement by the UK Parliament.

On 14th November 2018, Prime Minister Theresa May announced that her cabinet had approved a draft Withdrawal Agreement with the EU.  They also had a draft Political Declaration setting out the framework for the future relationship between the EU and the UK, and the Withdrawal Agreement would not be signed without an agreed Political Declaration (the principle that nothing is agreed until everything is agreed).  This was endorsed by the leaders of the other 27 EU countries on 25th November 2018. Let us now look at the key points in the Withdrawal Agreement and the Political Declaration. There is an “Explainer” document for each, published by the Government, which attempts to give an easily-understandable explanation of each document: the "Explainer for the agreement on the withdrawal of the UK from the EU" and the "Explainer for the Political Declaration setting out the framework for the future relationship between the United Kingdom and the European Union" are both worth reading and can be found here along with the documents they explain.

To give it its full title, the "Agreement on the withdrawal of the United Kingdom of Great Britain and Northern Ireland from the European Union and the European Atomic Energy Community, as endorsed by leaders at a special meeting of the European Council on 25 November 2018" provides for the following:

• a deal on citizens’ rights that protects the rights of EU citizens in the UK and UK nationals in the EU, ensuring they can continue to live their lives broadly as now;
• separation provisions that wind down certain arrangements (for example cooperation on civil court cases still ongoing at the end of the implementation period) under the current EU legal order to ensure an orderly withdrawal and smooth transition to the future relationship, noting that the majority of these provisions could be superseded by the agreement on the future relationship;
• a time-limited implementation period (ending on 31st December 2020) during which nothing changes with respect to trade and laws, providing certainty to businesses and individuals and ensuring they only have to adjust to one set of changes in line with the future relationship with the EU;
• arrangements on the financial settlement that represent a fair settlement of the UK’s rights and obligations as a departing Member State, in accordance with its legal commitments and in the spirit of the UK’s continuing partnership with the EU;
• governance arrangements that provide legal certainty and clarity to citizens, businesses and organisations and respect the autonomy and integrity of both the UK’s and the EU’s laws;
• the unique circumstances in Northern Ireland, including the continuation of the Common Travel Area arrangements, the ongoing protection of rights of individuals in Northern Ireland, and guarantees that, even in the unlikely event that our future relationship with the EU is not in place by the end of the implementation period, there will be no hard border between Northern Ireland and Ireland or a splitting of the UK customs territory (the "backstop");
• maintaining the UK’s international commitments in respect of the Sovereign Base Areas (SBAs), protecting the interests of Cypriots living and working in the SBAs and ensuring the continued effective operation of the SBAs for military purposes;
• a Protocol on Gibraltar which will form part of a wider package of agreements that address issues of importance to citizens and businesses in Spain and Gibraltar and reflect the parties’ desire to work together in support of the shared prosperity and security of the area.

As previously stated, once approved in Parliament, the Withdrawal Agreement will require further legislation to implement.  In November 2017, the Government announced its intention to introduce the EU (Withdrawal Agreement) Bill. The White Paper published in July 2018 on “Legislating for the Withdrawal Agreement between the UK and the EU” described how legislation would be taken forward.  The Bill will only be introduced once Parliament has approved the final deal under the terms of the EU (Withdrawal) Act 2018.

The "Political Declaration Setting out the Framework for the Future Relationship between the European Union and the United Kingdom" does not actually provide full details of the future relationship - it sets the terms for legal agreements to be finalised by the end of the implementation period, and I list the areas covered here to show the scale of what is still to be achieved:

• The future relationship should be based on the shared values and principles that the UK and the EU project and defend - respecting human rights, democracy, the rule of law, working together globally, and the non-proliferation of nuclear weapons.  This includes the UK’s commitment to the European Convention on Human Rights (ECHR) and the EU’s and its Member States’ continued commitment to the EU’s Charter of Fundamental Rights.
• The UK and the EU share a commitment to high personal data protection standards. They will also agree terms for potential UK participation in EU programmes in areas of shared interest such as science and innovation, youth, culture and education, development, defence capabilities, civil protection and space, as well as provisions for dialogue.
• A free trade area for goods that provides for no tariffs or quotas, and ensures a trading relationship that is as close as possible, combining deep regulatory and customs cooperation. The extent of the UK’s commitments, including alignment of rules, will be taken into account in the application of checks and controls. The UK and the EU will draw on all available technologies and facilitative arrangements as they develop these new customs arrangements, and establish alternative arrangements to permanently ensure no hard border on the island of Ireland and avoid the need for the backstop to ever be used.
• Ambitious arrangements for services and investment that go well beyond World Trade Organization (WTO) commitments and build on recent EU Free Trade Agreements (FTAs), including new arrangements on financial services, alongside timely equivalence decisions under existing frameworks.
• New and specific arrangements on digital, covering a wide-range of areas, including e-commerce, telecoms and emerging technologies, reflecting the growth and prominence of global digital trade.
• Temporary entry arrangements for people travelling for business, as well as visa-free travel for short-term visits, consistent with the UK’s commitment to end the free movement of people.
• A Comprehensive Air Transport Agreement, and arrangements that allow comparable market access for freight and passenger road operators.
• Mechanisms for efficient electricity and gas trade over the infrastructure linking UK and EU markets, along with a wide-ranging Nuclear Cooperation Agreement.
• A new fisheries agreement covering, amongst other things, access to waters and quota shares, which the UK will negotiate as an independent coastal state.
• Commitments to open and fair competition - proportionate to the overall economic relationship - covering state aid, competition, social and employment standards, environmental standards, climate change, and relevant tax matters.
• An ambitious and comprehensive future security relationship covering law enforcement and criminal justice and foreign policy, security and defence in addition to a range of thematic security issues including illegal migration and cyber security, reflecting the breadth and depth of shared interests and values.
• Comprehensive and close reciprocal law enforcement and judicial cooperation in criminal matters, that ensure criminals are brought swiftly to justice. Amongst other things, it will include establishing arrangements for effective and efficient exchanges of Passenger Name Record (PNR) data, of DNA, fingerprints and vehicle registration data, alongside swift and effective extradition arrangements, so that suspected criminals can be quickly extradited back to the requesting country. In addition, it will include data-sharing arrangements for wanted and missing persons, and the exchange of criminal records and cooperation between the UK and Europol and Eurojust.
• Arrangements on foreign policy, security and defence, which provide for close, flexible and scalable cooperation that allow UK and EU efforts to be combined, when it is in both their interests. This includes UK participation in EU missions on a case by case basis, consideration of how best the UK and the EU might cooperate on international development, consultation on sanctions, and the voluntary and timely exchange of intelligence. The deal ensures that cooperation can be scaled up in the event of a crisis.
• Additional thematic cooperation in other areas, including close collaboration on cyber security, illegal migration and health security.
• The future relationship will be based on an overarching institutional framework. This will be underpinned by mechanisms for dialogue, and robust arrangements for setting the direction and implementing the future relationship as well as resolving disputes, based on the dispute resolution mechanism in the Withdrawal Agreement.
• Preparatory organisational work for the formal negotiations on the future relationship will begin as soon as the Withdrawal Agreement is concluded, and before the UK leaves the EU, focusing on key issues such as the development of alternative arrangements for ensuring the absence of a hard border between Northern Ireland and Ireland on a permanent footing. Negotiations to conclude the legal agreements will begin as soon as the UK becomes a third country. Both parties have committed to best endeavours to ensure the future relationship can come into force by the end of the implementation period.

So there are very many details to be negotiated and agreed during the implementation/transition period.  This is why during that time common rules will remain in place with EU law continuing to apply in the UK subject to the terms set out in the Withdrawal Agreement. This will mean that businesses will be able to trade on the same terms as they do now, giving citizens and businesses in both the UK and the EU the time and confidence they need to plan for the UK’s future relationship with the EU.  

If we crash out of the EU without a deal, we will not get such an implementation/transition period, we will just be out with no alternative mechanisms and agreements in place, other than those provided by the World Trade Organisation (WTO - see report "What would trading on WTO terms mean?" by the organisation “UK in a Changing Europe”), and it is this that has led many people to have serious concerns about the no-deal exit.  It is why Parliament has been so keen to prevent a no-deal exit, and we will look further at this in my next blog posting as we review what has happened since the Withdrawal Agreement was endorsed by the leaders of the other 27 EU countries on 25th November 2018. At that stage it seemed to me that we were nearly there and we were on schedule to exit on the 29th March 2019 - I could not have been more wrong!

Gerontios