Don’t Shoot the Messenger

Like many people, I have been reading the European Union (Withdrawal) Bill since it was published this week. It is a Bill that faces a formidable task: how to create a body of EU-derived law within domestic law when the UK leaves the European Union and how to create mechanisms to allow that law to be interpreted, implemented and amended in the period following the UK’s departure from the EU. Not surprisingly, the complexity of the task is mirrored in the construction of the Bill itself.

When thinking about how to blog about the Bill, I fully anticipated that I would be approaching the task like a badly-denimed Top Gear presenter. Circling the Bill, peering under its hood and smugly opinioning to the audience, I expected to be dispensing pithy commentary about whether the Bill was a Fiat or a Ferrari.

Instead what I discovered is how out of practice I have become at reading domestic UK legislation. I am much more familiar with the style and syntax of EU legislation than I am the draftsmanship of UK legislation.  And that’s on top of getting to grips with what the Bill is actually trying to do. To signify my own bemusement, I tweeted something:

Screenshot 2017-07-15 17.00.37

The tweet incited responses. Many people saw in this the complexity of the legislative task. Others considered it to be a complaint about bad drafting. Still others linked it to the shambles of the politics of Brexit and the policy choices which are being made not just about Brexit but also within the Bill itself.

The responses have made me reflect on the types of comments and commentary that people like me make.

The first thing to make clear is that the tweet was an honest statement of my own inadequacies. While I understood fully the aim of clause 2, I was perplexed by this particular bit in it. I was rather hoping someone might help. It is one of the upsides of the social media of Brexit that it is possible to tap into a wide range of expertise. And I think that is especially important in the context of the real complexity of Brexit where none of us can lay claim to comprehensive knowledge or expertise. I have no shame in holding my hand up when I don’t understand something and I think it might actually help us all manage Brexit a little better if we could muster some humility.

The second point to make is that we need better to distinguish between the policy choices that ministers make and the technical craft of giving effect to those choices in law and in legislation. Rightly, lawyers, academics and others have things to say about those policy choices: from the decision not to include the EU Charter of Fundamental Rights within the corpus of EU-derived law to the discretion which UK government ministers will be able to exercise to make significant changes to these EU-derived rights and obligations. These are the very legitimate objects of commentary and criticism and the language we use in these contexts is part of the wider contestation of Brexit and its implications. But in the process, let’s not shoot the messenger. Public servants – government lawyers, civil servants and parliamentary counsel – face the difficult task of translating those choices into legal language. But they are not the author of those choices and its unfair to conflate the difficulties of decoding legislative drafting with the conduct of government at the level of ministers and their advisors.

Which leads me back to the tweet itself. It is also right that now that we have the draft of the Bill that it is properly road-tested. Part of that will be to try and respond to legitimate requests – like my own – for clarification. And part of it will be to see whether the Bill as drafted will function in the way it is intended and without creating anomalies or discrepancies. There is even room to ask whether the same outcome might be achieved in a different way. The legislative process and the scrutiny which attends the Bill is certainly a key way to put this Bill through its paces. But there is also space for wider commentary from academics and lawyers about how they see the Bill working in practice. As a simple example, the Bill uses the term “EU tertiary legislation”. It’s not a term I like. If it refers to what I think it refers to – a world of EU delegated and implemented acts – these are not examples of “legislation’ within EU law but are instead non-legislative acts. These are areas where I think there can be reasonable disagreement about the terms used in the Act. And it is right that I and colleagues offer commentary on the design, structure and content of the Bill.

As it happens, I have been offered an explanation of what the previously mysterious Clause 2(2)(c)(ii) means and I now think I understand what it seeks to do (there is, of course, an explanatory memorandum accompanying the Bill but I didn’t find the necessary detailed explanation I was looking for). So I think it’s possible to have a constructive dialogue about the Bill from a technical point of view. But I don’t think we should use that discussion as a proxy or metaphor about the conduct of the government in its handling of Brexit.

As a matter of record I want to say that if my tweet was interpreted as a side-swipe against hard-working government lawyers, counsel and civil servants tasked with the unenviable task of embedding EU law in UK law after Brexit, then I offer an apology. The intention was entirely the opposite: a candid admission that after more than twenty-five years of doing EU law I have probably become de-skilled in the ways of UK legislation. That does not bode well for my post-Brexit professional career.

Branching Histories and the ‘Error’ of Brexit

In the introduction to Brexit Time: Leaving the EU – Why, How and When? published last month, I quote from a blog post written by Dominic Cummings, the campaign director for Vote Leave. In that post, he describes a world in which events happen that change the future, but where those events happen in a ‘non-linear’ way. These are the ‘branching histories’ that take us down one road rather than another. Cummings wants us to make sense of our world by seeing how things might have been, as much as how they turned out to be.

Much of Brexit Time is infused with this sense of time and timing. The easy example is David Cameron’s decision to go for an early referendum rather than to wait. The choice – a choice in time but a choice structured by time – led to a referendum on 23 June 2016 and a vote that will see the UK leave the EU.

But time, and the branching histories of time, did not stop on 23 June. And in a fascinating interchange on Twitter between Cummings and  David Allen Green – lawyer, Financial Times journalist and author of a forthcoming, and much anticipated book on Brexit – Cummings returns to his theme now that we are a year on from the referendum.  Rather helpfully, Green’s own blog sets out the interchange in full. It begins with this:

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The interchange has been reported as an admission on the part of Cummings that the referendum was, and Brexit is, an ‘error’. For many this will chime with their own views, including views that key protagonists were simply playing politics, with history leaving it up to hapless politicians to try and make something of an outcome they didn’t expect and many didn’t want.

But I think it is important to be clear about what Cummings is admitting or asserting. He simply entertains the possibility that ‘in some possible branches of the future’ leaving will be an error. Otherwise – and as he says in a further tweet – ‘there are more possible branches of future in which leaving is good for [EU] as well as for UK’.

In essence, Cummings welcomes the destabilising effects of Brexit. For him it is a way out of a particular path dependence or a particular branch of history that saw the UK inside the EU.  But at the same time, there is no guarantee that this destabilisation will be capitalised upon either by the UK or the EU.

And so I don’t interpret Cummings’ response as a review of the last year and a conclusion that he and others got it wrong. Rather it is a projection forward and a willingness to accept that Brexit may not turn out to be the decisive moment of change for either the UK or the EU.

If one wants to criticise Cummings it is better to take a different approach.

The first is to argue that the EU has itself always been a destabilising force for Member States, requiring them to break out of narrow nationalistic patterns and to engage in structures of transnational cooperation in both economic and political terms. True, not every example will be a success, but the EU has been an evolving experiment in controlled destabilisation.

The second point is that the political destabilisation which has been unleashed by the referendum is anything but controlled. The UK is rapidly becoming an example of what I call ‘un-government’. This the appearance of government but without the operation of the processes and structures capable of stabilising the system sufficiently to provide for orderly decision-making. Brexit isn’t merely shaking up government, it appears to be shredding it. And all the while, the amount of time and energy which is going into Brexit makes it impossible for the government to do anything else, including the sorts of domestic changes which presumably Cummings believes are necessary for the full promise of Brexit to be realised.

Finally, the problem with focusing on time and history in this way is that it doesn’t give much space for politics, political actors and agency. By bracketing off choices and waiting to see what the branching histories of time reveal in the future, no one ever takes responsibility or is held to account for their choices and their ‘errors’. On a daily basis, we are seeing a toxic combination of indecision and poor decision-making. It is these failures which may end up with Brexit – at some point in the future – being evaluated as an ‘error’. But that doesn’t help us now whether you believe that Brexit is, and always was, a mistake, or if you believed it to be the right decision, but worry that it is being bodged by those in charge.

So as much as I travel some way with the branching histories of time, this time – a year after the referendum and a month after a general election which has only highlighted the splits over Brexit – seems like the right time to ask whether we really do want to continue down the path we embarked upon on 23 June 2016.

Has Article 50 Really Been Triggered?

With the Supreme Court handing down its judgment in Miller v Secretary of State for Exiting the EU on 24 January this year, one might have been forgiven for thinking that the issues around the legality of the triggering of Article 50 had been settled. As we all now know, the Supreme Court decided that Parliament had to give legislative authority for UK ministers lawfully to notify the UK of its intention to withdraw from the EU. Legislation was passed and the Prime Minister duly wrote President Tusk her Article 50 letter.

But Brexit is the gift that keeps on giving. At least for lawyers.

The calamitous outcome of the Prime Minister’s decision to call an early general election – in the form of a hung Parliament and a minority Conservative government – has given some quarters pause to revisit Article 50 to look for ways to pause or even halt the Brexit process. More dramatically, as reported in the Telegraph it is also being suggested that the Article 50 letter is actually legally devoid of purpose because no formal ‘decision’ to withdraw has been taken.

The argument that Article 50 has been falsely triggered is made by barrister David Wolchover in a recent issue of Counsel magazine. The argument is simple. Article 50(1) TEU states:

Any member state may decide to withdraw from the Union in accordance with its own constitutional requirements.

For Wolchover, the notification that is made under Article 50(2) which starts the withdrawal process depends upon their being a prior decision to withdraw. Given that the referendum held a year ago was not itself such a decision, it would have to be for some other body to make a formal decision. And given that the Supreme Court in Miller made clear that as the consequence of withdrawal was the loss of a source of rights in UK law which required express statutory authorisation, only Parliament could make such a decision. Wolchover’s claim, then, is that while Parliament may have authorised the notification under Article 50(2) TEU,  the European Union (Notification of Withdrawal) Act 2017 does not expressly enshrine a decision under Article 50(1) to end the UK’s membership of the EU.

It is a clever little argument. It is, however, misguided.

As with Brexit more generally, it is important to have a sense of perspective. More precisely, we need to be clear about what UK law demands and what EU law demands. It is easier to start with the latter.

I have long argued that from an EU law perspective, Article 50(1) is descriptive rather than normative. It describes a state of affairs which EU law presupposes exists, and subsequently lays down procedures for the management of that reality. In normative terms, at the very most, it identifies in EU law a right which exists under international law to withdraw from a treaty. Rather than leaving it up to the Vienna Convention on the Law of Treaties to regulate, Article 50 TEU for the first time sets out the procedures which the EU will follow. But even in these terms, Article 50(1) is describing rather than prescribing something.

Where EU law comes to life is in terms of the procedures laid down in Articles 50 (2)-(5) TEU. In particular, Article 50(2) is quite clear that the Article 50 procedures apply as soon as the European Council is notified of the intention to withdraw. Here, EU law is dealing with the intention to withdraw and not the decision which is – rightly – a matter of domestic law and politics. In this way, all that EU law has to contend with is the Article 50(2) notification and the consequences that then follow in terms of negotiation of a withdrawal agreement and the termination of membership.

As to UK law, what is clear from the Miller judgment is that key exercises of executive power are subject to domestic legal controls. UK law does not need the wording of Article 50(1) TEU to require that such exercises of power are in accordance with domestic constitutional requirements. Indeed, as an aside, when Article 50 was being drafted it was proposed to drop this part of Article 50 as it was suggested that what was or was not in accordance with domestic constitutional requirements was rightly a matter of domestic law. But it would be wrong to read too much into the retention of this language. The Supreme Court in Miller came to the conclusion that it did,not because EU law instructed UK courts to determine the constitutionality of the exercise of executive power, but because that’s just what a UK Supreme Court should do.

In this way, whether or not a formal decision to withdraw has been made (and the lawfulness of that decision) is a question for domestic law. Indeed, it is right to say that the domestic process – the decision, the notification, and acceptance of a future withdrawal agreement – are rightly matters to which ‘constitutional requirements’ attach as a matter of UK constitutional law. If it turns out that there is a legal defect capable of being challenged before a UK court which would suggest that a lawful decision is not in existence then self-evidently that would have domestic political and legal repercussions. But it would have no automatic legal consequences for the processes at EU level which are underway as a consequence of the Article 50(2) notification.

Certainly, it would not be for the European Court of Justice to make a determination of whether a decision had been made in accordance with domestic constitutional requirements. Rightly it would consider that to be a matter of the interpretation of domestic law. If, as a consequence of a UK legal process, it was clear that no such decision existed, then it might be invited to consider the consequences for the exercise of powers by EU institutions. But one might surmise that long before that happened, the politics would have taken over.

So my point is that the relationship between Articles 50(1) and (2) is not that depicted by Wolchover. His mistake is not to see that the provisions operate on different levels and while one has implications for the other, there is no automaticity to their legal articulation.

To further clarify my argument, let’s imagine that prior to the election and when considering the text of the European Union (Notification of Withdrawal) Bill, Parliament had done precisely what Wolchover asked of it, namely, that it made an express statement that a decision had been made to withdraw the UK from the EU and on that basis, the Prime Minister was authorised to give notice under Article 50(2). Imagine further that following the general election, and with a change of heart, it was decided by Parliament that the UK would not withdraw from the EU. A new domestic decision would have been made. And it would make not the slightest difference to the operation of Article 50(2) because – as an EU and not a domestic procedure – some act at EU level would be required: revocation of the notice. Again, as I have argued elsewhere, the UK can revoke its Article 50(2) notification unless and until it is acted upon by the UK finally withdrawing from the EU.

The point to grasp is that while Articles 50(1) and 50(2) clearly relate to one another, they also act independently to one another on different legal levels.

 

Tipping Point

Premature electioneering has once again afflicted a Conservative Prime Minister. Following on from David Cameron’s rush to the polls for his ill-fated EU referendum, Theresa May’s early election decision has back-fired on a colossal scale. Far from returning to power with a predicted landslide, a political tsunami has swept aside Mrs May’s majority in the House of Commons leaving her to lead a minority government with the assistance of the Democratic Unionist Party.

Speculation has been rife that the effect of the election will be to soften Brexit. Yet, speaking in Downing Street following her visit to Buckingham Palace, the Prime Minister seems intent on sticking to her original Brexit plan.

As for the timetable for Brexit, the clock is still ticking and the endpoint of the negotiations remains fixed even if the start date might change. Nothing in the election changes the timeframe for Brexit. At least for now.

Rather Mrs May’s political problems are domestic. The Prime Minister’s first headache will be to get the Queen’s Speech programme of legislation – much of which will be about delivering Brexit at a national level – through the House of Commons. Were she to lose a vote on the Queen’s Speech, tradition would suggest that her government would fall. However, the Fixed-term Parliament’s Act remains on the statute book and a defeat on such a vote would not itself trigger a general election. For an early election to occur we would have to go through the same process by which Mrs May embarked on her misguided 8 June election.

Before that happened, the Labour leader might be asked to form a government. Yet it is not obvious that a Labour Prime Minister would be in any better position to get a Queen’s Speech programme of legislation through the Commons.

Moreover, some might wonder whether the formation of a minority Labour government would really be in Labour’s interest. On the one hand, it may wish to capitalise on the party’s electoral successes and new-found popularity. On the other hand, the Labour leadership might rather that it was a Conservative Party that was forced to pick up the pieces of the 23 June referendum and carry through with Brexit. Rather than suffering from the same electoral dysfunction as the Conservatives, Labour figures might feel that it would be better to bide their time and wait for the Conservative Party to implode.

Meanwhile, standing in the wings like an anxious contestant on Tipping Point, Boris Johnson might also see the virtues of waiting for the right political counter to drop and push Theresa May out of office. For his supporters, it may be about time for Boris Johnson to take over his party’s leadership. For Johnson himself, it’s about timing.

Cometh the hour, cometh the man.

The UK Could Have Been Running the EU Not Leaving It

It’s 1 June and by rights the UK should have been preparing to launch its Presidency of the European Union. Instead of leaving the EU, the UK could have been running the EU. So what if David Cameron had delayed his EU referendum till after the UK’s Presidency?

What if the EU referendum had not taken place on 23 June last year? What if David Cameron had waited? Writing in the Guardian, Steve Richards asserts that if David Cameron had chosen a different date for the referendum, he would have won. He doesn’t explain why, but for the reasons I set out below, I suspect the outcome could have been different.

The timing of the referendum was a matter of political choice. The legislation which made provision for the referendum simply stated that it should take place by 31 December 2017, and even that was a political choice enshrined in law. It could have been changed.

The decision to go for June 2016 was the result of a number of factors.

First, having managed against expectation to secure an election victory in 2015, David Cameron did not want his premiership overshadowed by the issue of Europe. After all, he had also made clear that he would not be seeking to continue as Prime Minister after the scheduled 2020 election. He wanted the issue resolved and resolved quickly rather than having to deal with those in his party ‘banging on about Europe’.

Second, a Spring 2016 plebiscite was not going to work given his plans for EU reform and renegotiation before a referendum. The final deal on his ‘new settlement’ with the EU had been delayed after the December 2015 European Council failed to complete negotiations. Although agreement was reached in February 2016, the statutory ten-week referendum period would have risked a clash between the EU referendum and elections to the devolved parliaments in May.

Third, an Autumn referendum would have been an option following the summer recess and party conferences. But given the harrowing scenes the previous summer of refugees risking – and losing – their lives in the attempt to reach safety in Europe, a repeat over the summer of 2016 would be a difficult backdrop for the Prime Minister to make his pitch for the UK to remain in the EU.

But David Cameron did have other options.

The instinct to seek EU reform and renegotiation prior to a referendum was probably the right one but it wasn’t executed properly. This is not merely to repeat the attacks on David Cameron’s ‘new settlement’ renegotiations which were immediately trounced by his critics including the Eurosceptic press. Actually, as deals go, it wasn’t terrible. There was some substance to it and real concessions were made in relation to respecting the rights of non-Eurozone countries and in laying out a basis for legislative changes that would have restricted somewhat access to in-work benefits for migrant workers.

The mistake was not to see this as Phase I of a three-stage process which would have pushed back the timetable for a referendum. The renegotiation stage was never going to deliver a knock-out punch that would have tipped the result in his favour. If anything it became a rod for the Prime Minister’s back; a distraction from the real task of making the case both for EU membership and for future reform. Moreover, it focused attention on EU constitutional and institutional change more than it did on the delivery of common EU policies that might yield domestic social and economic benefits.

The Prime Minister should have been looking ahead to Phase II of a strategy: the UK’s Presidency of the EU that would start in July 2017. These rotating presidencies are often technical affairs of giving each Member State a turn at running the agenda of the Council for six months, with each presidency seeking to close deals on outstanding legislative dossiers. But they could be an opportunity for a Member State to decide to run with the idea that it is actually shaping the politics and policies of the EU. Summits can be convened. Declarations can be made. Statements of intent can be issued. What would have stopped David Cameron from setting out a policy agenda designed to show the electorate that cooperating with EU countries could be a force for good? Why wouldn’t EU leaders have wanted to offer a UK Prime Minister facing a difficult referendum every opportunity to show how working across borders was in the UK’s interest?

Of course, it would be important to pick out some key priorities. And if we learn something from the 2016 referendum campaign, it is that the ephemera of low-cost air transport, falling roaming charges and access to emergency healthcare while on holiday doesn’t cut it with an electorate that is more concerned with how global markets and porous borders make people feel insecure.

So here are three things a UK government could have run with. There is a degree of hindsight in that the issues chime with themes of the 2016 referendum campaign. But they were themes of the campaign and not products of them. The three examples are illustrations of how a UK Presidency could have been framed to build a case for retaining EU membership in a referendum to follow.

The first focal point would be around trade. As dramatised not just by the 2016 referendum but also the Trump and Le Pen election campaigns, support for ‘free trade’ has weakened on the Right as well as the Left. Instead of dragging its feet on the reform of EU trade defence instruments (‘TDIs’) – with the Commission having produced new proposals back in 2013 – the UK could have got on board with a strategic reform of EU TDIs – with a clear commitment to complete legislative changes under its EU Presidency. Free trade would need to be fair trade.

The second thing it could have done would have been to reframe some of the debate about people and borders by focusing on issues of exploitation. Part of that initiative could have been around trafficking of people, focusing on enhancing cross-border police and judicial cooperation. But another part could have been about steps to prevent the exploitation of migrant labour.  To be sure this wouldn’t deal with the issue of the numbers of people moving to work in the UK (the ‘new settlement’ dealt with some of the access to benefits side of things). And it would need to be complemented by domestic policies around restoring funding to councils facing particular pressures on public services (the Conservative-Liberal coalition having axed the fund that Gordon Brown had established). But it would help reframe some of the discourse to focus on migrants as potentially vulnerable people.

The third thing would be to look at what the EU budget is spent on. One of the problems the EU faces is the disconnect between what the EU does and what Member States do. The fundamental aspects of the welfare, education and health services which people care about and which influences their voting behaviour are provided nationally. The EU’s budget is spent on other things including supporting the income of farmers, regional development, and education and research. With a view to a wider reform of the EU budget, a UK Presidency could have championed an initiative to earmark part of the EU budget to support a major new drive to cut cancer rates across the EU. This would include new research and help to ensure the availability of cancer treatments. Given the domestic political problems around the high costs of cancer drugs and the use of national budgets to support cancer treatments, this could be an opportunity to harness the EU budget to support national healthcare.

It would not be realistic to think that the Prime Minister would have wished to hold a referendum on EU membership during the UK’s Presidency. On that basis, the artificial deadline of the end of 2017 would have needed to be changed. But there is another reason to push back the date.

The final phase of the process would be for the UK to support a wider process of EU reform. The 60th anniversary of the Treaty of Rome would be celebrated in the months leading up to the UK Presidency and with it, a process of reflection would begin on the future of the EU. The UK could have taken the initiative to lead this process of reflection during its Presidency with a view to seeking common ground on the reforms that the EU needs to its budget, to its processes and its institutions. The elections to the French Presidency and the German Chancellorship would have been completed by the end of a UK Presidency. While again we need to be careful about hindsight, would a Cameron, Macron and Merkel show of unity have helped drive a process of European political and treaty reform (aided by the alternative universe of a Trump White House)?

For good reason, David Cameron believed that a referendum on a future reform treaty would not suffice. At its simplest, the risk that ratification problems elsewhere in Europe would render a referendum in the UK redundant and so deny voters the opportunity to express their views was all too apparent.

However, the UK could have made clear in advance that it would immediately hold a referendum on any new treaty and that as this new treaty was about setting the course for the EU’s future, any rejection by the UK electorate would be tantamount to a rejection of membership (but with wiggle room for a further round of negotiations should the treaty be rejected). Other EU states would need to await the outcome in the UK.

It would be folly to claim that the outcome would have been obviously different. But it can be argued that a phased approach to an EU referendum would have given David Cameron more options. The UK’s Presidency of the EU was an opportunity squandered.

Brexit Implications of Opinion 2/15

The Court of Justice has delivered its long-awaited Opinion 2/15 on the scope of the EU’s trade powers under the so-called ‘Common Commercial Policy’ (’CCP’) of the EU (Article 207 TFEU) as well as the EU’s ‘implied’ trade policy powers. It is a ruling of interest to trade lawyers, but it will also be pored over by the UK Government and its lawyers when they consider the scope of the EU’s powers to negotiate and conclude a post-Brexit trade deal with the UK.

Exclusive EU Trade Powers

At the heart of the ruling is the question of the extent to which the EU’s trade powers are exclusive to the EU, and in what respects trade agreements engage powers that are retained by, or shared with, the Member States albeit that the Member States’ powers are exercised in a coordinated fashion and in conjunction with the EU. This issue has been a long-running saga of EU trade law and policy and was dramatized most clearly in the context of the EU’s recent trade deal with Canada. Despite the European Commission’s belief that the deal fell within the scope of the EU’s exclusive powers – and so could be negotiated by the Commission on behalf of the EU and concluded by the EU without the need for national approval – it decided to proceed on the basis that the deal was a ‘mixed agreement’ – involving issues of exclusive and shared competence – and so required domestic approval. When the Walloon parliament held up Belgian approval of the deal, there were fears that the EU’s trade policy was unravelling just at the moment that the UK was preparing to leave the EU and seek a new deal with the EU. As EU Trade Commissioner Malmström quipped at the time, ‘If we cannot make it with Canada, I’m not sure we can make it with the UK. But jokes aside …’ In the end, a solution was found to manage the concerns of the regional parliament but the saga highlighted the role of national – and even sub-national – parliaments as veto players in future Brexit negotiations.

It ought then to be clear that the more that can be done by way of a trade agreement falling within the scope of the exclusive trade powers of the EU then the risks from domestic vetoes or delays might be mitigated. Which is why all eyes were on what the Court of Justice would produce in its opinion on the EU-Singapore trade deal and the scope of the Union’s express trade powers under the CCP as well as any implied trade powers (which could also give rise to exclusive EU competence).

The Importance of the Legal Basis for EU Acts

Before turning to the ruling, there is a simple point worth repeating not least because it is a point that UK ministers continually fail to grasp. The more cavalier Brexiteers in the UK government take the view that everything is possible in the negotiations which lie ahead. Moreover, there is still an apparent difficulty in accepting that the negotiations will be phased not just in terms of the Article 50 withdrawal process itself, but also the negotiations that will continue and follow when the UK leaves the EU and becomes a non-Member State. From the EU’s perspective, what is possible – legally and politically – is framed by the treaties and the powers it confers on EU institutions to negotiate, agree and conclude deals. Different provisions of the treaty – the ‘legal bases’ which give legal authority to EU institutions – apply to different parts of these negotiations and have their own procedural rules. It is the irony of Brexit that the EU is not sovereign but a Union based on attributed competences and the rule of law such that what the EU negotiates and concludes can be legally reviewed before the EU courts.

So the immediate question that the Court’s opinion raises is whether it pushes Brexit negotiators on both sides towards concluding a trade deal within the confines of the EU’s exclusive competence in the hope that this will avoid vetoes from either national governments – much of the CCP can also be agreed by a qualified majority vote rather than unanimity – or their national parliaments. But it also sheds a light more widely on the relationship between, on the one hand, the bundle of agreements that will be needed to manage the Brexit process, and on the other hand, what the treaties substantively allow and procedurally require in order for negotiations to be lawful as a matter of EU law.

Article 207 TFEU

On the first point, the main take away from the Court’s opinion on the EU-Singapore deal is how much can be done within the scope of Article 207 TFEU. The point is of crucial importance to Brexit given that the Singapore deal – like the Canada agreement – is broad and ambitious and goes beyond the usual suspects of international trade agreements, namely the removal of tariff and non-tariff barriers to the market access of goods and services. Indeed, the EU-Singapore agreement contains seventeen chapters extending to issues of intellectual property, procurement, competition, investment, sustainable development and renewable energy generation. In principle, a very ambitious and comprehensive trade agreement can fall within the scope of Article 207 TFEU. Indeed, chapters of an agreement that deal with issues of social and environmental protection – matters where the EU has a limited and shared internal competence – can, nonetheless, fall within the scope of the CCP because they seek to ensure that free trade is also fair trade.

Indeed, the Court finds that ‘sustainable development’ is an integral part of EU trade policy.

Limits to Article 207 TFEU

Some things do not fall within the CCP and the issue arises whether, despite this, the fact that the EU has internal (intra-EU) rules in a field creates a parallel implied and exclusive external EU competence. In terms of international transport services, the express wording of Article 207(5) TFEU excludes this from the scope of the CCP. However, the EU does have an external competence to conclude international agreements under Article 216 TFEU and where the EU has common internal rules on transport services, the conclusion of an international agreement under Article 216 TFEU which would impact upon those rules, also gives the EU exclusive competence.

Foreign ‘direct’ investment is covered by Article 207 TFEU but not other indirect forms of investment. And it is here that the Court’s Opinion finds that the EU does not have exclusive competence to adopt and conclude the chapter on investment insofar as it extends beyond direct investment. Equally the institutional provisions relating to exchanges of information and cooperation relating to non-direct foreign investment cannot be concluded by the EU acting alone. Moreover, the dispute resolution mechanism relating to investor-state disputes also cannot be adopted by the EU alone (although the dispute resolution mechanism applicable to the parties to the agreement itself is within the competence of the Union in the same way as the substantive provisions which the mechanism is designed to enforce).

Implications for Brexit

It is the non-direct investment and the investor-state dispute resolution mechanisms which are the problematic areas of the EU-Singapore deal. But the bulk of this comprehensive agreement does fall within the scope of EU exclusivity and could form the basis for an ambitious Brexit trade deal following the UK’s withdrawal from the EU. While the new generation of bilateral EU trade deals do involve chapters on investment and investor-state dispute resolution, it would not be inconceivable to negotiate a parallel bilateral investment treaty (‘BIT’) between the UK and the EU as well as its more substantive Brexit trade deal. In this way, any difficulties with ratification of the BIT would not produce contagion effects to threaten the agreement and conclusion of a trade deal.

Sequencing and Timing

It is important to keep in mind that the Court’s Opinion is relevant to the agreement that the UK will conclude with the EU when the UK ceases to be a Member State. It’s relevance assumes that the UK Government sticks to its apparent direction of travel, namely, not to conclude an ‘association agreement’ with the EU when it leaves. In terms of Article 217 TFEU, association agreements require the unanimous agreement of all national governments. Moreover, given their wide scope, they are mixed agreements and so require domestic approval. As the EU-Ukraine Association agreement highlighted, domestic approval processes can include a referendum as was the case when voters in the Netherlands voted to oppose approval. While an association agreement would be a softer Brexit, it may be that the Court’s Opinion on the CCP will harden the government’s approach to seek a trade agreement that avoids domestic approval processes in other EU states.

Either way, before any of this can occur, the negotiations need to get underway on the withdrawal agreement itself. That agreement is based on Article 50 TEU directly. Like Article 207 TFEU, it is a legal basis that empowers the EU to adopt an agreement with a withdrawing state under certain substantive and procedural conditions.  The process is now underway with the European Council establishing guidelines for the negotiations, and the Council preparing negotiation directives for the European Commission who will conduct the negotiations on behalf of the Union. The agreement will be concluded on behalf of the Union by the Council, with the consent of the EP. There is no requirement as a matter of EU law to seek domestic approval in the parliaments of the EU27: an Article 50 TEU agreement is not a mixed agreement but rather one concluded on behalf of the Union. That will limit its scope to managing the immediate consequences for the UK and the EU of withdrawal rather than setting out detailed future relations between the UK, on the one hand, and the EU and its Member States, on the other.

Transition

The complication, however, is in respect of any ‘transitional arrangements’. Such arrangements would act as a bridge between the UK’s status as a Member State, and its status as a ‘third country’. In terms of the EU’s preferred sequencing of negotiations, the discussion of transitional arrangements would form part of Phase II of the negotiations once sufficient progress has been made in Phase I dealing with citizenship rights, outstanding liabilities and border issues relating to the UK and Ireland. It would seem, then, that Article 50 provides a legal basis for such a transitional arrangements. But clearly that creates a potential tension if such arrangements proved to be a long-standing means of managing the UK’s relationship with the EU in that they would, over time, undermine the EU’s specific external trade policy powers. More likely, they will need to be time-limited in order to form part of a withdrawal agreement (or bundle of agreements) based on Article 50 TEU.

All of which serves to reinforce the point that even if the UK and the EU can agree on what they both want, they may profoundly disagree as to the legal route to getting there and the timing of the stages of the process.

Irish (and Danish) Times

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The UK’s decision to withdraw from the EU is a choice. It is a choice with consequences not just for the UK but for others. It has particular consequences for Ireland but also for Denmark: the two countries that joined the EEC at the same time as the UK.

on 11 May, the EU’s Brexit chief negotiator, Michel Barnier, addressed a joint session of the Dáil and Seanad, setting out how the implications of Brexit for Ireland will be reflected in the future negotiations. He sought to reassure people in Ireland by saying: “… in this negotiation, Ireland’s interest will be the Union’s interest.”

Barnier drew attention to the particular challenge of reconciling the removal of borders within the island of Ireland with the requirements of customs and other controls to protect the Single Market, with the issue of the border between Ireland and the UK forming part of the first phase of Brexit negotiations.

The “unique position” of Ireland had already been reflected in the guidelines for the negotiations adopted by the leaders of the EU27 on 29 April 2017. As well as noting its support for the Good Friday Agreement and the peace process, the guidelines state:

In view of the unique circumstances on the island of Ireland, flexible and imaginative solutions will be required, including with the aim of avoiding a hard border, while respecting the integrity of the Union legal order. In this context, the Union should also recognise existing bilateral agreements and arrangements between the United Kingdom and Ireland which are compatible with EU law.

Leaders of the EU27 also agreed to record in the minutes of the meeting that in the event of a unification of Ireland pursuant to the Good Friday Agreement – based on the consent of the people expressed in referendums – EU membership would extend to the island of Ireland in the same way as occurred following the unification of Germany.

Not all consequences of Brexit are negative for Ireland. As the Taoiseach noted following the European Council meeting in April – and as he repeated in his reply to Michel Barnier’s speech – Ireland will be putting itself forward as a candidate to host the European Medicines Agency (EMA) and the European Banking Authority when these relocate from London after Brexit. There will be competition for EMA from Denmark who had also revealed that it would be throwing its hat in the ring, as well as from Denmark’s close neighbour Sweden, whose government also announced that it would be actively working to bring EMA to the Stockholm-Uppsala region. All of which dramatizes that while the UK, Ireland and Denmark may have joined together, the departure of the UK will not result in their departure too, but instead binds Ireland and Denmark more closely to the EU and its Single Market.

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Adapted from the final chapter of Brexit Time to be published by Cambridge University Press next month.

The UK didn’t join the EEC on its own in 1973. Denmark and Ireland also chose to join with it. Denmark and Ireland became Member States because the UK had chosen to join the EEC. The balance of interests – political and economic – made Danish and Irish EEC membership together with the UK a logical step. The UK’s departure from the EU has consequences for both countries but it is unlikely to lead to either country choosing to leave the EU.

Like the UK, Denmark has, over the years, secured a more differentiated membership in terms of its choices whether to participate in areas of EU co-operation. Following the original rejection of the Maastricht Treaty in a referendum in 1992, Denmark secured three ‘opt-outs’ concerning monetary union, defence co-operation, justice and home affairs and a clarification that EU citizenship did not replace national citizenship. In a referendum in 2015, Danish voters rejected ending Denmark’s justice and home affairs opt-out. These policy-specific referendums have made a ‘Dexit’ less likely even after Brexit. Voter preferences may be for maintaining control over specific policy domains, rather than for Denmark to quit the EU altogether. Brexit might have been avoided had the UK followed the Danish approach.

The UK’s departure from the EU means Denmark has lost one its strongest allies within the EU, and outside the Eurozone. The UK has also been one of Denmark’s most important trading partners with the vast majority of exports of pork going to the UK. At the same time, Denmark’s trade exposure to the UK is not what it was in the 1970s. The integration of the Single Market now ties Denmark closely to those states remaining in the EU and in the Single Market.

The trade consequences of Brexit for Ireland are also significant, with 17 per cent of Irish exports of goods and services going to the UK. But, like Denmark, Ireland’s dependence on the UK for trade has changed since the 1970s when 50 per cent of Irish exports went to the UK. Nonetheless, the economic shock of Brexit will be significant for Ireland and depending on what form Brexit takes – from a trade agreement to no agreement and the application of World Trade Organization (WTO) rules – it is predicted that output in Ireland will fall by between 2.3 and 3.8 per cent. Different sectors of the Irish economy will be exposed to the effects of Brexit in different ways, and the potential obstacles to trade will be different across sectors: from the risk of tariffs on agriculture, food and beverages to the non-tariff regulatory barriers in the pharma, chemicals and financial services markets.

The implications of Brexit for Ireland go beyond trade, so much so that Irish politicians were among the few foreign politicians to have been vocal during the 2016 referendum campaign. Regular meetings of UK and Irish ministers and Prime Ministers in Council and European Council meetings had helped forge the bonds of trust that made the Belfast ‘Good Friday’ Peace agreement possible and operational. Indeed, the preamble to the agreement is framed as follows:

Wishing to develop still further the unique relationship between their peoples and the close co-operation between their countries as friendly neighbours and as partners in the European Union

When it came to the big decision about the euro, Ireland chose a different path from the UK and Denmark. The UK’s decision not to participate in monetary union was not an impediment to Ireland choosing to do so. It was a defining choice for both countries. It now binds Ireland’s future more closely to that of the EU and the Eurozone.

It is clear, then, that in withdrawing from the EU, the UK is making its own choice.