It’s the end of May, we’ve got less than a year before the UK officially starts the transition to leave the EU, and the waters are as muddy as ever. Although a great deal of progress was made over the last couple of months, there are still some sticking points that need to be sorted out before the Brexit Bus can get back on the road.
First off is the key point that UK (and European) businesses will be concerned about – trade agreements. There were rumblings that Parliament would reject the current agreements and would move for the UK to stay in the European Customs Union. However, that now appears to have changed, and David Davis is confident that the House will stand with the Brexit team’s policy of leaving the Customs Union when the final exit strategy is invoked.
There are still MPs who are determined to vote against the exit policy, and despite David Davis’ buoyant mood, it could be a close call. If the vote goes against the government then other trade deals with major non-European partners could be put on hold.
Business hates uncertainty, and the seemingly never-ending Customs Union debate is bound to annoy both small and large firms, who simply want to get on with the day-to-day running of their businesses, and to plan ahead beyond 2020.
The single biggest sticking point to a successful resolution to Brexit lies across the Irish Sea. Northern Ireland is the only part of the UK to share a land border with another EU country (in this case, the Republic of Ireland). Despite offering up solutions to avoid a hard border in Ireland, the EU has so far rejected each suggestion out of hand. The concern is that EU officials do not think free trade or technical options are on the table, and that Northern Ireland will need to adhere to full EU regulatory restrictions, even once the UK has disentangled itself from Brussels.
For the British contingent, this is completely unacceptable, as it effectively ‘breaks up the UK’ and is regarded as the least desirable outcome. The preferred option is a free trade agreement but, as is often the case in Northern Ireland, nothing is ever black and white.
U-turn on Brexit
As in previous months, there have been those who have said that Brexit is not yet a done deal, and that there’s still time to stop the process entirely. And once again, as in recent months, the response from both Number 10 and Brussels is that Brexit is an unstoppable process and is going to happen, regardless of any calls for a second referendum.
The cost of Brexit
The National Audit Office has had a look at the ‘divorce bill’ for Brexit and concluded that the estimates of between £35-39billion is pretty accurate. However, even small fluctuations in the state of the UK economy (most notably interest rate rises) could send that number upwards.
EU national status in the UK
The Windrush Generation affair has made Brussels nervous about the future status of EU nationals in the UK, despite repeated assurances that the mistakes made in that instance will not be repeated. The British team may have some serious work to do to calm jittery nerves over what was one of the biggest sticking points for Brussels from the outset.
Website content note: This is not legal advice; it is intended to provide information of legal interest about current legal issues.