The Legal Clarifications to the Withdrawal Agreement – White Smoke or Smoke and Mirrors?

On 11 March, the European Union and the United Kingdom announced that agreement had been reached on the legal clarifications sought by the United Kingdom with the hope that these might be enough to ensure backing by MPs. These clarifications are found in two joint texts – an “Instrument” relating to the application of the Withdrawal Agreement and a “joint statement” supplementing the Political Declaration – and a unilateral declarationmade by the UK Government. It is on the basis of these clarifications that the UK Government has indicated to Parliament that political agreement has been reached and MPs are due to vote on 12 March on a motion to approve the texts of the Withdrawal Agreement and Political Declaration as is required under section 13 of the European Union (Withdrawal) Act 2018.

The Legal Status of the Clarifications

The main text simply describes itself as an “instrument”. We tend to think of instruments as a generic description rather than identifying a specific type of instrument e.g. a treaty, a protocol, a decision. The instrument itself states that it is an instrument for the purposes of Article 31 of the Vienna Convention on the Law of Treatiesmeaning that it is an instrument “which was made by one or more parties in connexion with the conclusion of the treaty and accepted by the other parties as an instrument related to the treaty”. The legal value of this is that when it comes to interpreting the objects and purposes of any treaty or agreement –  the central legal interpretative exercise – such an instrument is to be used to identify and define the purpose of the agreement. In other words, the joint instrument agreed between the Union and the UK is a legal instrument that reflects a common understanding of the purposes of provisions of the Withdrawal Agreement including the Protocol on Ireland/Northern Ireland.

The joint statement on the Political Declaration similarly attempts to clarify how aspects of the Political Declaration will be taken forward and underscores the relationship between the Withdrawal Agreement and the Political Declaration. Nonetheless, its legal status is no higher than that of the Political Declaration itself. The Declaration and the supplementary text identify political commitments and political intentions in instruments which are not of themselves binding legal texts.

The declaration by the UK Government sets out its understanding of the objective of the backstop. It is unilateral in nature and in consequence it cannot create obligations for the EU unless the Union acts in a manner which indicates that it considers itself bound by the declaration. Rather, it is a text that defines the legal position of the UK in respect of how it would act were it to consider that the backstop had become permanent contrary to its objective.

The Legal Effects Created

Far more important than the legal status of the texts is the legal effects that they are intended to create. In respect of the backstop, the key issues relate to how to avoid the backstop being triggered in the first place and how to exit the backstop were it to come into effect if no agreement could be reached to replace it.

Article 2(1) of the Protocol on Ireland/Northern Ireland states:

The Union and the United Kingdom shall use their best endeavours to conclude, by 31 December 2020, an agreement which supersedes this Protocol in whole or in part.

In other words, by the end of the transition period – during which time the whole of the UK will remain bound by EU law obligations – it is the aim of the Union and the UK to have in place an agreement that will prevent the backstop being triggered. In view of this – together with the general “good faith” obligation contained in Article 5 of the Withdrawal Agreement – the joint instrument sets out the commitments the parties are making with regard to the negotiations on subsequent agreements that will supersede the backstop. These steps include:

  • Preparatory work on the future negotiations as soon as the Withdrawal Agreement is signed (para 6)
  • A distinct negotiating track to replace the customs and regulatory alignment aspects of the Protocol through “alternative arrangements” including existing and future “facilitative arrangements and technology” (para 7, and para 6 of the supplementary joint statement)
  • A capacity for the distinct negotiating track to give rise to either a separate agreement or to form part of the overall future relationship. A separate agreement could become applicable and replace the relevant parts of the backstop even if the future relationship had not been agreed, and could be given provisional application pending ratification (paras 10 and 11)
  • Regular monitoring of the progress of the negotiations with high level conferences convened every six months (para 8) or at the request of the parties to address substantive obstacles that might risk or delay progress (para 9).

These are the sorts of steps I identified as being essential to the implementation of the commitments made in the Withdrawal Agreement and the Political Declaration in my proposal for an “Implementation Protocol”. They are intended to ensure that negotiations are on track to deliver outcomes before the end of the transition period.

The more contentious aspects relate to what happens if the backstop is deployed and there are problems with agreeing texts to replace the backstop. In his original legal advice, the Attorney General Geoffrey Cox highlighted that the backstop would endure unless and until replaced by a subsequent agreement. Although the parties did not intend the backstop to be permanent, if there was no way out of it, then it would endure. He highlighted that if a dispute about the backstop went to the Arbitration Panel established under the Withdrawal Agreement, the remedies available before the Panel did not include termination of the backstop. Instead the remedy that might be available would be to suspend the operation of part of the Agreement with a view to bringing the other side back to the negotiating table (para 28 of the AG’s advice).

The joint instrument aims to clarify that if either the UK or the Union act “with the objective of applying the [backstop] Protocol indefinitely” contrary to the good faith obligation contained in Article 5 of the Withdrawal Agreement and the best endeavours obligation in Article 2(1) of the Protocol, then the Joint Committee established under the Withdrawal Agreement is to be immediately brought into action with a view to resolving the dispute. If the dispute is escalated to an Arbitration Panel established under the Agreement, it can determine if one side is acting with the objective of applying the Protocol indefinitely. The joint instrument notes that a “persistent failure” to comply with its obligations could give rise to “temporary remedies” against the offending party. However, the key message it contains is that ultimately the aggrieved party could unilaterally enacts of proportionate suspension of its obligations under the Withdrawal Agreement – apart from the citizens’ rights provisions – “unless and until” compliance with the ruling of the Arbitration Panel is ensured (para 14).

In this way – and without termination of the agreement – the UK could unilaterally suspend its obligatons under the Withdrawal Agreement, but only once an Arbitration Panel had concluded that the Union was breaching its good faith and best endeavours obligations as regards the negotiation of an agreement to supersede the backstop, and only if there was a “persistent failure” to comply.

This presents a two-fold difficulty.

The first point is that the effect of this instrument is limited to only one type of breach – acting with the objective of making the backstop indefinite contrary to the obligations of good faith and best endeavours in the conduct fo negotiations – rather than any other disagreement between the two sides. Yet, it is perfectly possible that both sides and in good faith have very different understandings of a problem that is preventing them from reaching an agreement. Indeed, the difficulties with the negotiations thus far may point to that very fact. In legal terms, neither side has complained that the other is acting in bad faith even when they have clashed over what might be needed to avoid a hard border on the island of Ireland. This may mean that an Arbitration Panel could conclude that a dispute between the parties simply did not give rise to a breach of the good faith or best endeavours  obligations.

Of course, this would not prevent other types of dispute coming before the Arbitration Panel. Indeed a dispute could arise as to the operation of the review mechanism in Article 20 of the Protocol on Ireland/Northern Ireland which aims to determine when the backstop should cease to apply. But in placing all the emphasis on an exceptional breach of the good faith and best endeavours obligations, an opportunity has been missed to clarify how the Article 20 review mechanism might ordinarily be applied. In my proposal for an “Implementation Protocol” I suggested that the Joint Committee establish an “assessment framework” to help with the review mechanism, with oversight from the Arbitration Panel.

The second difficulty is the very open nature of the good faith and best endeavours obligations. As normative standards they are open to different interpretations and an Arbitration Panel might demand a high standard of proof to show that they had been breached.

The UK’s unilateral declaration is intended to shed some further light on this. It sets out the UK’s understanding that a breach of the good faith requirement preventing the conclusion of an agreement to supersede the Protocol would entitle it to consider that the Protocol was no longer temporary, and that nothing in the Agreement would “prevent it from instigating measures that could ultimately lead to disapplication of obligations under the Protocol”. This would seem to repeat para 14 of the Joint Instrument rather than adding anything to it. Indeed, it is clear that the outcome of the disapplication of obligations would have to follow the process to which the UK is legally bound under the Withdrawal Agreement, namely seeking a political resolution within the Joint Committee and a referral to an Arbitration Panel if there is no resolution. All of which takes us back to the difficulty in determining a breach of the good faith and best endeavours obligation in the first place.

In conclusion, the clarifications that have been produced are contained in documents with a legal status intended to produce legal effects. Insofar as those effects are aimed at de-risking failures in the political negotiations on the future relationship they are a step in the right direction, although my proposal for an “Implementation Protocol”goes further, not least by giving parliaments a greater oversight over future negotiations. In respect of remedies in the event that there are problems in the negotiations, the Union and the UK have put all their eggs in one basket – a breach of the good faith and best endeavours obligations. This may confine disputes and remedies to a narrow corridor of problems that may beset negotiations with the added problem that an Arbitration Panel may demand a great deal before finding a breach of those obligations.

MPs looking for a reason to vote in favour of the Government’s deal may well find enough in this to grasp with both hands. However, those looking for a reason to reject the deal will also find limitations in what has been produced.

The Cooper-Letwin Article 50 Extension Proposal – How Long For?

Arriving at a summit at Sharm El-Sheikh, the UK Prime Minister has confirmed that this week’s votes in the House of Commons will not include a vote to approve a revised Brexit deal. No ‘deal in the desert’ is set to emerge at this gathering of EU leaders. Instead the so-called ‘meaningful vote’ will likely take place on 12 March a matter of weeks before the United Kingdom’s scheduled departure from the European Union on 29 March 2019.

There may, however, be a vote of some significance if MPs vote on the plan promoted by Yvette Cooper and Oliver Letwin to seek an extension to the Article 50 withdrawal process, pushing back the date of the UK’s departure from the Union.

At the end of January, the House of Commons rejected Cooper’s original amendment that would have extended the Article 50 process to the end of the year. But as time has passed the likelihood of a need to request more time has grown.

With the exception of a ‘No Deal’ Brexit – which MPs rejected when they voted on the ‘Spelman amendment’ in January – any Brexit scenario is now going to need an extension of the Article 50 process.

If MPs had this week been presented with, and backed, a Brexit deal, the legislation to bring that deal into law in the UK – a 100-page European Union (Withdrawal Agreement) Bill – will take time to make its way through the legislative process. This sort of extension is what is sometimes described by the EU as a ‘technical extension’ and would be for a matter of months.

However, with the EU still waiting for clarity from the UK about what sort of deal could command a majority in the House of Commons, a more radical idea has been floatedof forgetting about a technical extension and instead pushing Brexit back to 2021. In essence this would mean abandoning a 2019 Brexit with a transition period to 2020 or 2021 during which a new EU-UK relationship would be worked out.  Instead the UK would remain a Member State while it decided what it really wanted by way of a future relationship with the EU.

A delayed Brexit of this length would avoid the problems of a shorter extension running into the May 2019 elections to the European Parliament. Remaining a Member State would mean that the UK would have to return MEPs in this year’s election notwithstanding that the number of MEPs allocated to the UK have already been redistributed to the other Member States.

Nonetheless, it would also beg the question whether the EU – contrary to the position it has consistently taken – would actually be prepared to negotiate the text of a future relationship without the UK having become a so-called ‘third country’. The key advantage of having a negotiated deal in place at the moment that the UK left the EU would be that it could avoid the need to have an ‘Irish backstop’ as an insurance policy while negotiations on a future deal that would also avoid a hard border were on-going.

While one can see the advantages of a delayed Brexit, it would have profound domestic political consequences.

It would accept that the May Government had failed to produce a plan for the future capable of obtaining a consensus or even a majority within the Commons. If the Prime Minister cannot get a deal over the line with a technical extension to implement it, it’s difficult to see how either she or her government could carry on. Indeed, one might even consider that an extension of Brexit to 2021 would be a pretext for an early election to allow a new government to seek to build a consensus on a different way forward. In that way, it would be a proposal that would play to the Labour leadership’s preference for a general election as a way of unblocking the Brexit deadlock.

Delaying Brexit would create a significant rift in the Conservative Party between those who don’t want any delay to Brexit even if that means a No Deal Brexit, and those who want a softer Brexit or even for the UK to remain in the EU. It would also be a significant boost to Nigel Farage and his Brexit party who would claim that Brexit was being frustrated, creating futher tensions within the other main parties.

For those who want the UK to remain in the EU, the longer the UK remains a Member State, the greater the potential to build momentum around a new referendum and a Remain vote.

It is readily apparent, therefore, that a lengthy extension to UK membership of the EU wouldn’t merely create an opportunity to define a vision of a UK future outside of the EU, it would fundamentally reconfigure the domestic politics of Brexit.

More immediately, this all presents a very important choice for a new Cooper-Letwin Article 50 extension proposal.

Any extension needs the consent of the EU27. If the EU has come to the conclusion that an extension is EITHER a short-term technical extension OR a more lengthy delay to Brexit, then the Cooper-Letwin proposal would need to choose between these options.

If they go for a short extension it would be tantamount to accepting that Brexit will be a variant of the current negotiated texts with a risk that a No Deal Brexit could still happen if MPs refuse to back the deal.

If they go for a longer extension, it would recognise that only a No Deal Brexit had been largely taken off the table with a No Brexit option remaining in play as well as a potential change of government.

Whie the Prime Minister could have lived with an amendment giving a technical extension, an amendment that would significantly delay Brexit would be difficult for the Government to support even tacitly.  It would also be difficult for the Labour leadership not least because of the intense pressure on Jeremy Corbyn following this week’s spate of MP’s resignations from the party. The Labour Party may say it wants a general election but it is not obvious it would win given the internal divisions within the party over Jeremy Corbyn’s leadership.

Once again, issues of time profoundly shape what sort of Brexit – if any – will result. The fate of the Cooper-Letwin initiative may well depend on how much time they think is needed for an Article 50 extension.

There may be no deal in the desert but the sands of time continue to trickle for the UK and the EU.

 

100 Days to Brexit -From ‘Branching Histories’ to Binary Choices

Forget the 12 Days of Christmas, there are now just 100 days remaining of the United Kingdom’s forty-six-year membership of the European Union. In the upcoming weeks, days and hours, critical choices will be made that will shape not just Brexit but every aspect of UK political, economic and social life in the years ahead.

Eighteen months ago I posted the following on this blog:

In the introduction to Brexit Time: Leaving the EU – Why, How and When? 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.

This was brought back to mind when listening to my Cambridge colleagues David Runciman and Helen Thompson discussing Brexit on their weekly Talking Politics podcast. In particular, David spoke of the narrowing of choices down to a moment when a binary choice will be apparent and a decision will be made that will define Brexit. Whereas the Cummings thesis is that moments of destabilisation and disruption produce an expanding set of political choices and options, the Runciman perspective is one of a gradual narrowing of those choices into a new moment of decision.

What is perplexing about our current times is that both dynamics – expanding and contracting choices –  appear to be possible at the same time.

With the production of a Withdrawal Agreement and a Political Declaration on the future UK-EU relationship in November, the range of options available to politicians seemed to narrow decisively. Indeed, the consensus from both the UK and the EU sides of the negotiations is that this is thedeal and it is the only deal on the table. And with anxieties about the Irish backstop continuing to put at risk the conclusion of the deal, the response from the EU has been to reiterate that the text of the agreement is not to be re-opened for further negotiations.The binary choice seems to be Deal or No Deal.

It is precisely because the Prime Minister’s Brexit deal looks unlikely to get the consent of MPs at Westminster – a realisation that led the PM to delay a vote on the deal until mid-January – that every potential alternative outcome – from a ‘No Deal’ Brexit to a ‘Norway Plus’ future relationship – now seems to be in play. The ability of the UK to revoke its Article 50 withdrawal notification is also now an option following the recent ruling of the Court of Justice of the EU. We seem to be generating more possibilities rather than narrowing the choices down.

But choices will need to be made and the sequencing of those choices will determine the outcome.

The first choice is for MPs to make: to approve or not to approve the PM’s Brexit deal.

This is a decision MPs gave to themselves when Parliament enacted the EU Withdrawal Act 2018. The Government cannot proceed to ratification of the Withdrawal Agreement without parliamentary approval of the legally-binding Agreement and the accompanying non-binding Political Declaration (setting out the direction that UK and EU negotiators intend to take to talks on the future relationship).

If MPs do not approve the Brexit deal, Parliament has no capacity to substitute its own preferred version of Brexit. It cannot enter into negotiations with the EU. It could try directing Government as to the deal it might want – something it perhaps ought to have done when empowering the Prime Minister to trigger the Article 50 withdrawal process – but it is hard to conceive how this could be done without Government backing for the legislation that would then bind the Government in its EU negotiations, nor is it obvious that the EU would consider going back to the drawing board. if MPs reject the deal table then – absent anything else – a No Deal Brexit cannot be avoided. So why might the deal be rejected?

For those who dislike the backstop provisions of the Withdrawal Agreement, a No Deal Brexit may seem preferable despite its implications for the Irish border and for the reciprocal protection of the rights of EU citizens in the UK and UK citizens in the EU. This is the view of those for whom any deal betrays the mantra of taking back control. If the objection is instead to the future UK-EU relationship contained in the Political Declaration, there is nothing to prevent a different type of relationship being negotiated once the UK leaves the EU. The Political Declaration does not bind either side to only one vision of the future. Choices can still be made including the option of Norway-style access to the Single Market whether or not combined with a Customs Union. Provided the Withdrawal Agreement is otherwise acceptable, it is less obvious why MPs would vote down this deal simply because they think a better future UK-EU relationship is possible. Like it or not, the smoothest path towards the UK’s departure from the EU is to accept this deal.

If the deal is rejected by MPs, the Government faces further choices.

There is a political choice about whether a new government is needed to take charge of Brexit. This could happen in one of two ways without a general election. Having survived a vote of no confidence in her leadership within her own party, the Cabinet could, nonetheless, force the PM to resign under threat of Cabinet resignations. After all this was how Margaret Thatcher was evicted from No. 10. The problem the Conservatives face is the absence of an alternative position or rallying figure around which Tory MPs could coalesce. Given that the Conservatives are running a minority Government, unless a new Conservative administration could be formed that could command the confidence of the Commons, the initiative could pass to the Opposition parties to form a minority government. Because of the riskiness of the political arithmetic entailed in running minority administrations, the better option might be to precipitate an early election under the Fixed-term Parliaments Act. Nonetheless, for the Conservatives the risk would be that Labour would capitalise on the Conservative’s mishandling of Brexit, while for Labour the risk would be that it inherits the Brexit problem weeks before the UK’s intended departure. Changing government at this time seems politically dangerous.

It is against this background that the option of a further referendum begins to make more sense. Mrs May could end up backing a referendum as a Hail Mary option to give voters the option of backing her deal, thereby forcing MPs to get in line with the electorate. For those who believe a No Deal Brexit – or ‘managed’ No Deal – is preferable to the Brexit deal, allowing voters that option also has some leverage. It may seem more acceptable to fall off the cliff-edge if the people give politicians the final push. However, it is impossible to conceive of the necessary referendum legislation getting through Parliament if all that is offered is a choice between Mrs May’s Deal or a No Deal Brexit. So perhaps contrary to David Runciman’s assumption that decisions inevitably move towards a binary choice, a third option of remaining in the EU could well be an option.

With three potential choices on a referendum ballot paper – and the risk that a split ‘Leave’ vote could allow a ‘Remain’ vote to win even if the combined Leave vote was greater than 50% – voters would have to be asked to rank their preferences. A referendum in these terms would have the advantage of allowing voters to express multiple preferences at least as regards where things stand now. It would not give voters an alternative deal to vote on but as explained above, accepting the current deal does not rule out alternative scenarios in the future.

In a previous blog post I came to the conclusion that a referendum on the options was preferable to an attempt by Parliament to manufacture a ‘least worst Brexit’. That was when we were 340 days from exiting the EU and before the UK Government and the EU agreed withdrawal terms. The political climate has deteriorated significantly to the point we are now at and we need to be honest that a referendum that selects any one of the available Brexit options also has destabilising consequences.

If the electorate backs the PM’s Brexit deal as delivering on the 2016 referendum, it will highlight the chasm between politicians and the people on Brexit. Voters will have done the dirty work that MPs appeared incapable of doing on their own. The erosion of faith in parliamentary democracy will accelerate.

Backing a No Deal Brexit would double down on a loss of faith in politicians to negotiate an orderly exit from the EU by engendering a significant shock to the UK, Irish and EU economies. The babble about a Brexit on WTO terms or a managed No Deal Brexit veers between the wholly inaccurate and the triumph of hope over reality. Crashing out of the EU will produce a political and economic crisis.

If Remainers content themselves with the belief that staying in the EU is a comfortable reversion to the status quo, they ignore that the status quo changed with the 2016 referendum. The genie will not be put back in the bottle. The political right – and its representation in the tabloid press – stands ready to claim that ‘our’ Brexit has been stolen from ‘us’. Don’t be surprised if the Yellow Vest movement makes an appearance on UK streets, filling the gap created by the UKIP implosion.

The Prime Minister has suggested that another referendum will damage democracy. The problem is more that democracy is capable of damaging itself, the political and economic institutions and the social order it sustains, and from which it is itself sustained. That process began with the 2016 referendum and could accelerate with another referendum. The flip-side is that the system of representative democracy does not seem to be working either.

Perhaps David Runciman is right after all. There are binary choices to be made that are about the choice of democratic process – parliamentary democracy or direct democracy – as well as about what form Brexit will take.

If Parliament takes the initiative and approves the Withdrawal Agreement and Political Declaration, it will have taken the options of No Deal and No Brexit off the table. If Parliament rejects the deal and leaves it to the electorate to decide, it seems highly unlikely a ‘People’s Vote’ would really be on the deal if it is the deal that MPs have rejected. In practice, even if there are three options on the ballot paper, the first preference selection would likely become a binary choice between a No Deal Brexit and No Brexit. A referendum would put back on the table what parliament could have taken off the table. That is the choice MPs must make when they return to the Commons in January.

Putting the Bullet Back in the Chamber -Could Parliament Exit from Brexit?

The Wightman judgment from the Court of Justice of the European Union holding that a Member State may unilaterally revoke its notified intention to withdraw from the EU prior to that withdrawal taking effect has largely fallen foul of a Brexit news cycle in which each new twist and turn supersedes the last. Indeed the UK Prime Minister’s decision to postpone a House of Commons vote to approve the Withdrawal Agreement and Political Declaration negotiated between the UK and the EU almost entirely overshadowed the Court’s ruling.With the substance of the ruling more or less following last week’s Opinion from the Court’s Advocate General, the impact of the judgment is also somewhat reduced. However, the judgment contains significant messages for political and legal audiences.

To the political audience there is one enormous political message and it is not so much a message about withdrawal as it is about membership.

The Court is clearly signalling that membership of the European Union, and the rights and responsibilities which come with it, is voluntary. States exercise their sovereignty to choose to join the European Union and the Court emphasises that when states join the EU using the Article 49 TEU process they ‘freely and voluntary’ commit themselves to the values underpinning the EU. The discipline of EU membership – including acceptance of the primacy and direct effect of EU law – is something which states can accept voluntarily by joining, or reject voluntarily by leaving the EU. If a state decides to change its mind and not to leave but to remain a Member State, it must be free to do so voluntarily and can neither be coerced into leaving or be authorized to remain by the other Member States.

In short, the Union is a voluntary association of sovereign and equal Member States. As political messages go, that is a pretty big message.

That big message also comes with a more specific message for the UK. If the UK were to decide to remain in the EU it would do so ‘under terms that are unchanged as regards its status as a Member State’. Given that the UK’s membership of the EU entails a range of opt-outs, these would not be up for renegotiation as a condition of remaining an EU Member State.

In other words, the status quo of remaining in the EU would be the status quo of the UK’s current terms of membership.

Aside from these important political message, the judgment also has something for EU lawyers and UK constitutional lawyers.

For EU lawyers, the decision is of significance not least in resolving a legal question that had been much debated in blogs and in journal articles (some of which are summarised in my earlier blog on this case). Despite well expressed reservations in some quarters that unilateral revocation might be used to game a withdrawal process or might otherwise risk moral hazards or abuse, the Court has come down on the side of a contextual and historical interpretation of Article 50 TEU that emphasises the voluntary nature of the withdrawal process. Accordingly, unless and until a withdrawal agreement enters into force or the two-year withdrawal period – or an extended period – expires, a Member State remains free to change its mind and notify the European Council (in writing) of its ‘unequivocal and unconditional’ intention to remain a Member State of the EU.

The ruling is also of interest to EU lawyers because of the willingness of the Court not only to deal with the case on an expedited basis – the ruling comes barely more than two months from the request of the Scottish Court of Session for a preliminary ruling from the Court – but also because of the rejection of the UK Government’s position that the referral was inadmissible. The Court was unwilling to accept that the presumption of the relevance of the question posed by the national court had been rebutted. Interestingly, once the Inner House of the Court of Session had determined that the case was admissible under domestic rules governing an application for judicial review and had rejected claims that a referral was inadmissible on grounds of being hypothetical or academic in nature, the Court of Justice appeared to be content with those assessments. In particular, the Court did not accept that there was no real dispute between the parties unlike other cases where the parties have essentially contrived litigation in order to obtain an interpretation of EU law from the Court. That said, the essential dispute between the parliamentarians and the UK government was on the need for a reference to the Court of Justice: it is hard to see what other substantive dispute there was between the parties.

For UK constitutional lawyers, the Wightman ruling is also of some significance. While the UK Supreme Court in Miller had proceeded on the assumption that an Article 50 TEU notice could not be revoked we now know that this is not the position under EU law and no doubt some will speculate whether the clarification of the legal position would have led to a different result (for the reasons given by Jack Williams it is unlikely that the Supreme Court would have decided differently). However, the point remains that there are domestic constitutional requirements which must be met in order for the UK to leave the EU and as the Court of Justice tells us, these are also applicable to revocation of a notice of intention to withdraw from the EU. Indeed, the Court’s safeguard against an abusive withdrawal of a notified intention to leave the EU is that a change of mind is subject to domestic decision-making procedures. Thus, any decision not to withdraw from the EU must – by analogy with the decision to withdraw in terms of Article 50(1) TEU – be in accordance with domestic constitutional requirements.

The Court of Justice has muddied the waters somewhat, however, by referring not just to the notification of an intention to revoke in accordance with domestic constitutional requirements but also to the Member State’s decision ‘to revoke the notification of that intention through a democratic process’. Two issues arise. Is the need for a ‘democratic process’ an additional EU law requirement, and what would an acceptable democratic process look like?

One way in which the Court departs from its Advocate General is that the Court does not demand that the notification of revocation meet EU requirements of good faith and sincere cooperation. In that light the reference to the democratic process could be viewed as a more concrete procedural demand of EU law intended to prevent an abusive exercise of the right to revoke at the whim of the executive. However, the better view is that decisions to withdraw from the EU or stay a Member State remain sovereign matters for the Member States themselves and the domestic constitutional and democratic procedures mandated by the laws of the Member States. The EU law requirement is instead for the revocation to be ‘unequivocal and unconditional’ – that the revocation is the result of a constitutional and democratic process is the domestic means of achieving that outcome. It is not for the EU to mandate what those constitutional and democratic requirements ought to be, but it is for the EU to verify that the outcome achieves its need for a decision that is unequivocal and unconditional.

All of which leaves open the question of what democratic requirements might be required by UK law. As we saw with the original Article 50 withdrawal notification, it may not be entirely apparent what rules UK law imposes. Phillipson and Young contend that an Act of Parliament would be required given that the will of Parliament – expressed in the European Union (Notification of Withdrawal) Act 2017 and the European Union (Withdrawal) Act 2018 providing for the UK’s departure from the EU – would be frustrated by a revocation of the UK’s Article 50 notice. A referendum prior to that decision would not be required although it could be undertaken if the UK so chose. But whether a referendum occurs or not is being driven by the somewhat chaotic domestic politics of Brexit rather than being a product of the Court’s Wightman ruling. Indeed one way of reading the judgment is that the best way of securing an unconditional and unequivocal decision to revoke the notified intention to withdraw from the EU is for the UK Parliament to legislate accordingly.

If the political message of the Wightman ruling is that the EU is a union of sovereign states, then the legal message is that it is up to the sovereign UK Parliament to decide whether the UK leaves the EU or remains a Member State. But as the Prime Minister’s decision to postpone a vote on her deal reveals, it is not obvious that there is any consensus within Parliament to move one way or another. The Court of Justice has left open the possibility for the Brexit bullet to be returned to the chamber. It is not obvious that the Chamber of the House of Commons knows whether it wants the bullet back.

An earlier version of this post appeared as Sovereign Choices: The CJEU’s Ruling on Exit from Brexit, VerfBlog, 2018/12/10, https://verfassungsblog.de/sovereign-choices-the-cjeus-ruling-on-exit-from-brexit/.

Time for a Rethink – What Did We Learn From Today’s Opinion on Revoking an Article 50 Withdrawal Notification?

In an Opinion published today, Advocate General Campos Sánchez-Bordona has recommended to the Court of Justice of the EU that it finds that it is legally possible for a Member State to revoke its Article 50 withdrawal notification and that it may do so unilaterally.

The Advocate General emphasised the unilateral nature of the notification of an intention to withdraw from an international treaty. For him, this continues throughout the Article 50 process meaning that the ‘intention’ to withdraw can change and a Member State may exercise its sovereignty to revoke its intention to leave the EU up until the expiry of the two-year period following the original notification. In short, the UK has up until 29 March 2019 to notify the European Council if it wishes to change its mind and the agreement of the other Member States is not required.

However, the powers of a Member State to revoke a notified intention to leave the EU are not unconditional. Firstly, a notification must be in accordance with national constitutional requirements meaning that the domestic constitutional rules and procedures are a limit on the power of a government to indicate a change of position. Secondly, the principles of good faith and sincere cooperation are applicable to avoid an abuse of the right of revocation.

Today’s Opinion arose from judicial review proceedings brought earlier in the year before the Scottish courts seeking to determine whether EU law permits the UK to revoke its notified intention to leave the European Union. The case was initiated by members of the Scottish, UK and European parliaments and was initially rejected on the grounds that it appeared to raise a largely hypothetical question as the policy of the UK government is not to revoke the Prime Minister’s letter of 29 March 2017 notifying the European Council of the UK’s intention to leave the EU.

On appeal, the Inner House of the Court of Session was mindful that in terms of section 13 of the European Union (Withdrawal) Act 2018, members of the UK Parliament have an opportunity to vote on the Withdrawal Agreement and Political Declaration negotiated between the UK and the EU as part of the Article 50 withdrawal process. With a parliamentary debate on the Brexit deal beginning today and ending in the so-called ‘meaningful vote’ on 11 December, the argument before the Scottish court was that in order to make up their minds, MPs also needed to know whether there was a legal option to revoke the Article 50 notification. The Court of Session decided it needed a definitive legal interpretation of whether revocation was permissible under Article 50 and, if so, whether it could be undertaken unilaterally or only with the agreement of the EU27.

The UK Government has opposed the attempt to involve the Court of Justice and even sought to appeal the decision of the Court of Session to the UK Supreme Court. But with the Supreme Court refusing permission to appeal to it, proceedings got underway before the Court of Justice. The Court of Session had requested that the Court of Justice handle the case with urgency and today’s Opinion comes very rapidly after the oral hearing on 27thNovember. At that hearing, the UK Government continued to oppose the admissibility of the case on the grounds that it would draw the Court of Justice into a political issue. Although the European Commission also thought that the Court of Justice could be justified in refusing the admissibility of the case it did recognise the exceptional and constitutionally significant nature of the question being asked before the Court. However, on the substance of the case, both the European Commission and the European Council believed that a state could not revoke an Article 50 notification unilaterally but rather needed the unanimous consent of the other Member States. That view was rejected by the Advocate General in today’s Opinion. However, it will still be for the Court to come to its own decision on the admissibility of the legal question posed before it and if so, whether it agrees that revocation is unilateral. The answers provided by the Avocate General to these questions are consistent with my own views expressed in an earlier blog on Verfassungsblog.

On the one hand , given the timing of the meaningful vote a week today and the uncertainty which inevitably arises from a non-binding Advocate General’s Opinion, an early final judgment of the Court is highly desirable. However, this case is only the fifth case to go to a Full Court composed of all judges in its modern composition of more than 20 judges. Getting a quick ruling will depend on whether a consensus has emerged on the admissibility of the case and on the answers to be given to the questions posed to the Court. The Court may also wish to avoid what might look like an overtly political intervention in the febrile domestic politics of Brexit.

On the other hand, a judgment after the Commons vote on 11 December is not necessarily irrelevant given the likelihood that the vote will see the Prime Minister’s deal rejected making a second vote or even a referendum a distinct possibility.

Remainers are likely to seize on the Advocate General’s Opinion in seeking to propel the Brexit debate towards a further referendum to include an option for the UK to change its mind and remain in the EU. Leavers are perhaps more likely to see today’s events as an unwanted interference in a domestic political matter.

Is the ‘Backstop’ a Trampoline to the Future UK-EU Trade Relationship

Following the publication of the text of the Withdrawal Agreement on 14 November, the full text of the Political Declaration on the future UK-EU relationship is now keenly awaited (the outline was published on the same day as the text of the Withdrawal Agreement). It will set out the aspirations for an ambitious economic relationship between the UK and the EU to be negotiated once the UK has left the EU on 29 March 2019. EU leaders will consider these documents at a special summit to be held on 25 November.

The Withdrawal Agreement itself is not just the ‘divorce’ agreement but also sets out two routes to a new UK-EU relationship.

The apparently obvious route is to be found in the part of the Agreement establishing a ‘transition period’. In essence, the transition period is a legal ‘stand-still’ during which time the UK will remain bound by EU law obligations but without being a Member State and without any of the representation in the EU’s institutions that flows from EU membership. The transition period is intended to give the UK and EU time to negotiate agreements governing their future relationship. The transition period lasts until 31 December 2020 unless – before the end of July 2020 – the UK and EU agree to exercise an option to extend the transition period. Although the Withdrawal Agreement does not determine how long this extension might last, the use of the formulation ‘up to [31 December 21XX]’ suggests at least a year up until the end of 2021, although Michel Barnier has indicateda willingness to accept a transition period up until the end of 2022. Extending transition will entail making future budget contributions for the additional years that the UK remains in the transition period.

The longer that the UK remains in transition, the longer the UK and the EU have to negotiate a future relationship without the need for the provisions of the Protocol on Ireland and Northern Ireland – the ‘backstop’ – to be triggered. Until the transition period ends, frontier controls on the island of Ireland will continue to be eliminated because the UK will remain in the Customs Union and the Single Market. While offering a relatively smooth transition from EU membership – things would remain more or less as they are until the new agreement became applicable – an extended transition period has certain drawbacks.

A longer transition opens the UK Government to the accusation of delivering a ‘zombie’ Brexit that transgresses its own red lines. In transition the UK will have formally left the EU but will remain within the Customs Union, the Single Market – including free movement of people – and remain subject to the jurisdiction of the Court of Justice. Extending transition also entails additional budgetary contributions. The other less obvious but potentially significant problem with parking the UK in transition is that it doesn’t help identify what the UK would be transitioning towards and so might make it less easy for businesses to anticipate the adjustments they may need to make. That said, the political declaration ought to go some way towards illuminating the path towards the future relationship even if it stops short of building a direct legal bridge towards the ultimate destination.

The less obvious route to a future relationship with the EU is through the ‘backstop’. There are two reasons why we have perhaps not given sufficient thought to the backstop as an additional bridging device. The first is that we have tended to treat the ‘Irish problem’ as somehow distinct from the wider discussion about the UK-EU future relationship. This was odd given that it should have been clear that any solution to the border issues on the island of Ireland was always going to be a strong signifier of how the UK and the EU might structure their economic relationship to reduce any friction on trade. It would be a tall order to devise one solution to manage the border issues in Ireland as a ‘backstop’ and at the same time devise a different but equivalent solution for the future relationship. Nonetheless, with some factions pushing the Government towards a more minimalist free trade agreement – which would leave unresolved the Irish border issues – treating the backstop as an exceptional device became part and parcel of how we thought about it. Secondly, the language of ‘backstop’, or ‘insurance policy’ or ‘safety net’ has underscored the idea that this is a device which is not intended to be used.  Instead the focus has been on agreeing the future relationship to avoid ever having to invoke the backstop’s provisions.

However, when we consider what the UK and the EU have agreed as a backstop it becomes much clearer that this may be less a residual fall-back and more of a policy choice as a way of bridging the gap between EU membership and a future relationship. The backstop may turn out not to be a safety net, but a trampoline.

At the core of the backstop is the ‘single customs territory’ encompassing the customs territory of the EU and the customs territory of the whole of the UK including Northern Ireland. Good produced in either territory move without payment of any customs duties, as do goods from third countries that have paid the relevant tariffs applied by the EU and the UK to goods from outside the single customs territory (the UK will align its tariffs and its trade policy with that of the EU).

During the operation of the backstop, the UK has committed to certain ‘level playing field’ obligations in respect of taxation including compliance with EU and international standards as well as certain EU directives. In the spheres of environmental, social and employment regulation, there are  ‘non-regression’ clauses. These commit the UK to not reduce its level of protection in things like air quality targets and waste management. The UK has also agreed to implement a system of carbon pricing in line with the EU’s carbon trading system. In the area of employment protection, the Protocol requires the UK not to reduce standards in areas such as health and safety at work, working conditions and employment standards (but without application of the dispute resolution mechanism laid down in the Agreement).

In addition to all of this, the Protocol requires the UK to comply with EU state aid rules (with certain exemptions for agricultural production) albeit enforced not by the European Commission but the UK Competition and Markets Authority (the UK’s competition regulator). That said, the European Commission is to be allowed to bring cases in UK courts for alleged breaches of state aid rules. The EU’s competition rules on cartels and abusive market behaviour is also applicable.

In short, while the backstop means that the UK is out of the EU Customs Union and its Single Market, the coordination of the UK and EU customs territories and the maintenance of certain obligations aimed at ensuring that competition is not distorted ensure that the whole of the UK will enter into an economic relationship with the EU that may anticipate the type of future relationship that the UK and EU might seek to build. To be sure, an agreement on a future relationship will seek to go beyond this not least in terms of trade in services and other non-economic spheres of cooperation like foreign and security policies. But at least as regards trade in goods, entering into a backstop arrangement pending the finalisation of a complete package of agreements on a future relationship might seem preferable to an extension of the transition period.

What then becomes interesting is that the other provisions of the backstop that are specific to North-South relations on the island of Ireland and which would keep Northern Ireland more closely aligned with the EU Single Market than the rest of the UK – in order to avoid non-tariff barriers to trade on the island of Ireland – becomes the exceptional part rather than the dominant part of the agreement.

That the backstop may perform a more active role in defining what happens after 29 March 2019 can be easily evidenced. The Preamble to the Protocol itself makes clear that:

‘HAVING REGARD to the Union and to the United Kingdom’s common objective of a close future relationship, which will establish ambitious customs arrangements that build on the single customs territory provided for in this Protocol, in full respect of their respective legal orders.’

The UK Government’s own explanation of what the Withdrawal Agreement entails – while describing the backstop as an ‘uncomfortable arrangement’ – nonetheless states that:

‘If the future relationship is not going to be ready by 1 January 2021, the UK has two choices: request an extension of the [transition period] or activate the backstop.’

This presents the backstop as a distinctive policy choice. It would move the UK out of a stand-still transition in which the UK would have the obligations and not the benefits of EU membership into what would in effect constitute an ‘interim agreement leading to the formation of a free trade area/customs union’ within the meaning of Article XXIV of the General Agreement on Tariffs and Trade 1994. The enforcement mechanisms contained in the Withdrawal Agreement would apply in place of the normal enforcement mechanisms that apply to EU Member States and which will apply to the UK during transition. The free movement of people would come to an end.

Legally, using the backstop as an interim trade deal is not without its difficulties and may even be incompatible with the use of Article 50 TEU as a legal basis particularly if the backstop dragged on. Indeed, while there has been much discussion about the inability of the UK to unilaterally exit the backstop, were the backstop to become an enduring basis of UK-EU relations the legality of the arrangement would likely be challenged.

If the Withdrawal Agreement ever enters into force – and currently it looks unlikely to obtain approval in the House of Commons – we may yet look back and realise that turning the backstop into an interim trade arrangement was the key to making Brexit happen.

Extending the Transition Period: 3 Options

Following her visit to the European Council meeting in Brussels, the Prime Minister Theresa May indicated that the UK might seek to extend the Brexit transition period ‘for a matter of months’. A recent European Policy Centre discussion paper has proposed a one-off mechanism to extend the transition period for a year. However, this week newspapers reported that the Cabinet had been warned that the UK could end up in a long-running transition following its departure from the EU. In a new Faculty of Law Research Paper,  I explore three options open to the UK to extend the transition period and conclude that creating an extended transition and implementation facility would allow transition to end early as new agreements between the UK and EU enter into force.

For some time now, both the United Kingdom and the European Union have been agreed that once the UK ceases to be a Member State of the EU on 29 March 2019, it will enter into a ‘stand-still’ period during which the UK will continue to be bound by its existing EU obligations (alternatives to this approach were explored in an earlier blog). The rationale behind this is to avoid a ‘cliff-edge’ departure which would otherwise see tariffs and regulatory controls imposed on cross-border trade between the UK and the EU.

To the extent there has been disagreement between the two sides it has been on terminology – the EU refers to this as a ‘transition period’ while the UK insists on calling it an ‘implementation period’ – and duration – the UK sought a two-year period whereas the EU was only willing to agree a transition that would end on 31 December 2020 (coinciding with the end of the current budgetary ‘multi-annual framework’). The UK agreed to the EU’s offer of a transitionending in December 2020.

However, the duration of the transition period has come back to the fore of the negotiations for two reasons.

The UK believes that the issue of how to avoid a hard border on the island of Ireland can only properly be resolved in the context of the negotiations on the future economic relationship. The UK had hoped that this might be negotiated in parallel with the withdrawal arrangements. However, the EU has insisted that it is only the framework for future cooperation that can be discussed in the context of the withdrawal negotiations meaning that the terms of a future economic relationship can only be agreed once the UK leaves. As long as the UK is in transition, the issue of frontier controls on the island of Ireland does not arise. But with the transitional period ending at the end of 2020, EU negotiators have insisted on the need for a ‘backstop’ to ensure that if transition ends without a deal on a future relationship that meets the commitments made in the 2017 Joint Report, a ‘hard border’ in Ireland will be avoided. It is the failure to reach agreement on a backstop which is making negotiators on both sides reconsider a time-limited transition period.

The second reason for revisiting the duration of the transition period is that the pace of negotiations thus far, coupled with deep disagreement over the UK Government’s ‘Chequers Plan’ for a new UK-EU relationship, suggest that the transition period as currently conceived will be too short to allow for negotiations on a future relationship to be concluded. Taken together with the backstop issue, minds have turned to whether it would be prudent to extend transition,

In a recent European Policy Centre paper, Tobias Lock and Fabian Zuleeg make a strong case for the extension of transition, suggesting that a one-time one-year option to extend transition would be a workable solution.

In a new Research Paper, I explore three potential models for an extended transition:

  • A one-off option to extend transition for a year following the end of the initial transition period (the Lock and Zuleeg model)
  • A rolling or open-ended transition with an exit mechanism
  • An extended transition and implementation facility.

The Research Paper suggests that while Lock and Zuleeg make a good case, their proposal still risks a ‘second cliff-edge’ at the end of an extended transitional period if there is no agreement on a future relationship. A one-year optional extension may not give negotiators sufficient time to reach an agreement and might not create sufficient confidence to avoid the need to negotiate a backstop.

The most obvious way to avoid a backstop would be to keep the UK in transition unless and until a new economic partnership between the UK and the EU was agreed (provided also that this met the commitments on the Irish border agreed in the 2017 Joint Report). However, a perpetual transition would be politically unacceptable, be difficult to manage in budgetary terms and would conflict with EU law. It would, therefore, need an exit mechanism. This could be modelled on Article 50 itself and allow either the UK or the EU to notify the other of their intention to end the transition period. After a defined period, the transition period would come to an end with or without a deal on a future relationship.

A compromise solution draws on the existing draft Agreement and would allow transition to end once new agreements on customs and trade, foreign, security and defence policy are agreed and became applicable. Unlike an open transition, this facility would have to have a defined endpoint and a proposed deadline of 31 December 2022 is suggested. This is beyond the next General Election which is scheduled for 5 May 2022. The aim would be to give negotiators the flexibility to agree new partnership arrangements but with incentives to reach agreements early to avoid the need to continue to use the transition and implementation facility. The UK and EU could depart transition well before the facility expired. This does not ‘solve’ the Irish border issue. The Withdrawal Agreement must contain commitments which have already been made to avoid a hard border. The pressure remains on the UK to define how a future relationship with the EU would meet those commitments. But by expanding the time available to continue negotiations, at least some of the current pressure on negotiators may be released. The alternative is that no deal is done on withdrawal and the UK departs the EU without a Withdrawal Agreement. In which case the issue of frontier controls comes quickly back onto the agenda. Extending transition in the hope of finding solutions may be the least worst outcome.