Lawyers at odds over meaning of Brexit deal

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Dec 18, 2017
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There are concerns about how much protection a transition period before Britain leaves the EU would really afford

Steffan Rousseau/PA

City of London lawyers were at odds over whether last week’s agreement to progress to stage two of the Brexit negations would avert a cliff-edge, “no deal” departure for the UK.

Milagros Miranda Rojas, an international trade law expert at the London office of the transatlantic law firm Norton Rose Fulbright, argued that it “remains unclear whether a fully fledged trade partnership can be negotiated before the transitional period ends”.

She added that “if a complete and developed trade deal is not formally concluded at the end of the transition, the risk of a cliff-edge might not be avoided”.

However, Alexi Dimitriou, a competition specialist at the City firm Ashurst, said the second phase guidelines at least postponed a cliff-edge departure for a transition period.

“During the post-Brexit transition phase,” he said, “the UK will continue to participate in the customs union and the single market, and therefore continue to apply EU rules and be subject to the European Court of Justice.”

Frustrated Brexiteers

Dimitriou acknowledged that such a transition deal was likely to “frustrate those who want a clean break. However, it provides businesses with further clarity on the immediate trading environment post March 2019, something which they have been starved of so far.”

And, he claimed, “it should come as no surprise that the longer term trade agreement could only be concluded after the UK left the EU”.

Lawyers at another transatlantic firm, DLA Piper, also emphasised that the political truce on the UK’s side of the Channel was likely to be short lived.
“Much will depend on whether the prime minister can sell the upside of remaining in the single market and customs union for two further years after March 2019, to pro-Brexit MPs in her party,” said Paul Hardy, a partner at the firm. “Staying in the single market and the customs union is tantamount to staying in the EU — all EU powers apply.” 

Hardy also argued that the government’s defeat in the House of Commons last week on an amendment to the withdrawal bill that gave MPs the right to a “meaningful” vote on the final deal was potentially not as important as its backers contended.

The amendment, said Hardy, “does not change the fact that it is still a take-it-or-leave it vote. When parliament vote on the deal after the negotiations are concluded, it is unlikely to vote against a deal which allows for a two-year status quo transition.

“To do so would be to risk a cliff-edge Brexit. Realistically, it will only vote against a worse outcome than, in other words, the no-deal scenario. That’s the main significance of the vote: to stop the UK leaving the EU without a deal in place.”
 
Between Brexit and the deep blue sea

Hardy raised the prospect of politically difficult situation if the negotiations between London and Brussels were ultimately unsuccessful — and yet MPs voted against leaving the EU without a deal.

That position, he said, “would weigh direct democracy and parliamentary democracy in the balance. Options for the prime minister include going to the European Council to seek an extension of the negotiating period, or to seek a withdrawal of the Article 50 notification.”

He added: “The former is more likely than the latter, but may not be accepted. The prime minister could also ignore the vote and let Brexit unfold, as the deadline is set by EU law, not national law. However, to do so would be at a huge personal political cost.”

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