The time left to strike a deal is limited
Despite the charm offensive initiated by the recent visit to Europe by British Prince William and Princess Kate, reports have indicated that Michel Barnier, a former French foreign minister, after his talks with his British counterpart David Davis, has reflected that the two sides were still at odds over Britain’s divorce bill.
This includes the rights of European citizens living in Britain, and whether Britain would acknowledge jurisdiction of EU’s top court with regards to the rights of the 3 million European citizens living in Britain.
It was hoped that the meeting scheduled for August 28 would focus specifically on removing existing differences, and that a “solution” might be found on the basis of “flexibility from both sides.” This does not appear to have happened.
The EU is stressing on quick removal of differences by October 2018, so that the European and British parliaments can approve the deal in time for Brexit day, which is scheduled for March 29, 2019.
It is in this context that one needs to understand the nuances that are being taken into consideration within this exercise. The salient points are as follows.
References in this regard need to be understood within the context of Article 50, and is now in the hands of the lawyers. The EU appears to be aware of the apparent contradiction between, on the one hand, wanting to treat the UK like a third country, and on the other, insisting on permanent, continued direct jurisdiction of the European Court of Justice (ECJ). They are realising that extra-territorial jurisdiction of the ECJ cannot simply be presumed.
The British Home Office, for its part, also knows that if its acclaimed goal of reciprocity of treatment is to be achieved, British citizens resident in the EU cannot lay claim to more rights under EU law than EU citizens who stay on in Britain enjoy under British law.
This question has arisen within Phase I of the sequence of the Article 50 negotiations concerning the EU’s new frontier with Northern Ireland. The ultimate solution with regard to this intractable question will require a political solution if the UK chooses to stay in the EU customs union. A flexible interpretation of Article 50 could then enable the emergence of a provisional solution.
This issue has difficult connotations. On May 24, the commission published its proposals for the criteria to determine what it calls a “single financial settlement.”
However, as yet there has been no official response from London. Without a bankable promise from the UK on the budget, the European Council will have difficulty in judging whether “sufficient progress” is being made on Phase I to allow it to trigger Phase II.
It also needs to be remembered at this point that unless Phase II starts, there will be no political discussions on defining the framework for the future relationship between the UK and the EU.
Consequently, without agreement on Britain’s final landing zone, clearly defined and mapped out, it will be impossible to proceed towards a negotiation of the transitional arrangements. Therein lies the rub, because the transition period can only be designed once it has been decided how long the UK will continue to honour its current budgetary obligations under the EU’s multi-annual financial framework.
The importance of this exercise arises from the fact that Brexit is likely to create a 10 billion euro hole in the EU’s annual revenue.
Brexit is likely to create a 10 billion euro hole in the EU’s annual revenue
The lack of a concrete decision on the transition arrangements is likely to seriously impact business in Britain, whose opportunities for investment are already declining. In any case, the longer it takes to put the transitional apparatus in place, the less valuable the transition period will become. Economists have indicated that investors will not hang around the City of London waiting for clarity and purpose to emerge from Whitehall.
A British response will also be required with regard to the proposal of the European Commission made on June 28 that a Joint Committee be set up to manage the actual Brexit process. This envisages a joint transition authority that will ensure suitable execution of various facets of the Article 50 secession treaty; adjust the secession treaty to reflect the evolution of EU law; ensure an agreed process aiming to find a settlement to political and technical disputes before they get to litigation and also “perform any other task conferred on it by the Withdrawal Agreement.”
Only close coordination between London and Brussels will avoid any possible legal vacuum in this respect.
5. The court
British Prime Minister Theresa May in all likelihood will need to prepare herself and her coalition to agree to make a major concession on the future role of the ECJ.
This will be insisted upon, because as long as any transitional period lasts, the ECJ will retain its current powers to ensure that relevant EU law is applied appropriately in the UK. As a result, they will have to accept the legal obligations that flow from those rights.
At this time, the British government and its parliament appears to be recovering slowly from the double hangover of the 2016 referendum and the 2017 general election. This is affecting its ability in being able to agree on strategic decisions.
Nevertheless, the EU 27 also needs to have patience with regard to potential joint initiatives. They also need to reflect on the future, not just of the smaller European Union, but of the wider Europe after the forthcoming German elections in September.
I shall conclude with Fabian Zuleeg. He has pointed out: “Back in Britain, the turmoil is obvious, with different members of government taking diverging views, suggesting, at times, that a soft Brexit or a transition arrangement might be possible, even if it means concessions on the role of the European Court of Justice (ECJ), the exit payment, the rights of EU citizens and even (temporarily) continued freedom of movement of EU citizens.
Adding to this is a chorus of voices outside government demanding that the UK reconsider its position, following the indecisive general election.”
As former permanent representative of Bangladesh to the European Union, I feel that Zuleeg has correctly warned that “the assumption that the EU27 are willing to accept any deal to avoid Brexit is misguided.
“Not only are there red lines that they will not cross, but the clock is ticking as well. The time left to strike a deal is limited.
“Otherwise the UK will end up with no deal at all.
“The reason that the EU27 are willing to accept this negative outcome is that greater goods are at stake: The unity of the EU27, the integrity of the single market, and the future of European integration.”
Brexit has become more complex, but a constructive approach on both sides, based on reason, will create a better framework for the rest of the world, particularly developing countries like Bangladesh which rely on both parties for support in their quest for socio-economic development.
Muhammad Zamir, a former Ambassador and Chief Information Commissioner of the Information Commission, is an analyst specialised in foreign affairs, right to information, and good governance. He can be reached at [email protected]