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Friday, November 4, 2016

How to End the Brexit
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In the past few weeks, much of the debate surrounding the United Kingdom's departure from the European Union has centered on how the Brexit process should begin. Questions have been raised as to whether British Prime Minister Theresa May can legally open negotiations with Brussels without Parliament's blessing. Meanwhile, the priorities May's administration will set for the talks are still up for debate, as are the futures of Scotland, Northern Ireland and the London financial sector. But despite the emphasis on these pressing issues, which will no doubt need to be addressed, several recent events suggest that wrapping up the negotiations may prove even trickier than starting them.
Consider the European Union's controversial free trade agreement with Canada. On Oct. 17, the bloc's trade ministers failed to ratify the deal, in large part because Belgium's Wallonia region voted against it. Yet other member states objected to the accord, too: Romania and Bulgaria, for instance, demanded that Canada lift its visa requirements for their citizens in exchange for their support for the deal. The same day, on the other side of the Continent, a British government lawyer told a local court that the Cabinet would likely put any EU-British agreement to a vote in Parliament. (Though the British government believes Parliament's approval is not necessary to open talks with Brussels, it does think lawmakers' buy-in would be needed to ratify any deal they yield.)
At first glance these events may seem unrelated, but they are, in fact, connected. London has been watching the Canadian free trade agreement's progress carefully, in the event that it could someday serve as a model for the United Kingdom's own deal with Brussels. The Canadian pact is the most comprehensive free trade agreement the European Union has ever crafted, and it includes the liberalization of trade for some 98 percent of goods as well as a lengthy list of services. Of course, it is not perfectly suited to London's needs. It does not, for instance, include the passporting rights that would allow financial firms operating in the United Kingdom to sell their services to the European Union. Nor would it answer Scottish demands for continued access to the Continent's internal market. Nevertheless, the Canadian accord offers a comprehensive solution for trading goods and allows Ottawa to maintain full control over its immigration policy — both critical items on London's own wish list.

A Path Riddled With Pitfalls

Once the United Kingdom decides to open talks with the European Union, two main questions will have to be answered: What are the conditions of the United Kingdom's withdrawal from the bloc, and what are the terms that will govern their relationship after the Brexit is complete? In all likelihood, both issues will be discussed simultaneously. Any agreements that are reached will then be put to a vote by the Council of the European Union, which represents the governments of EU members, and by the European Parliament. 
But the process will not end there. Any EU accord on responsibilities shared between the bloc as a whole and its individual members — commonly known as a "mixed agreement" — must be ratified by each country involved as well. In the likely event that a Brexit deal is deemed a mixed agreement, as the Canadian trade deal was, several national and regional parliaments will be required to weigh in on it. So, even if London and Brussels reach a mutually satisfactory arrangement, there is no guarantee it will pass muster with EU states.
Moreover, some members, as they have with Canada, could issue their own demands in exchange for their approval. Central and Eastern European states, for example, have promised to block any Brexit deal that restricts the rights of their citizens living in the United Kingdom, while countries hoping to attract firms leaving the United Kingdom may try to limit its access to the EU financial market. Other threats may not even be directly linked to the United Kingdom: Southern European members could vow to block a Brexit deal unless, for instance, Brussels' rules on members' debts and deficits are changed. London may try to protect itself from these dangers by demanding certain safeguards from the European Union, such as barring national and regional parliaments from the ratification process or constraining their ability to modify the deal once governments have accepted it. But Brussels, seeking to protect its own leverage in the talks, may not be willing to concede to those requests.
Even greater obstacles could arise within the United Kingdom itself. In the immediate aftermath of the British referendum, some lawmakers argued that London was not obligated to honor its outcome because it was not a binding vote. Since then, however, most politicians have come to terms with the fact that, binding or not, the majority of British voters want to leave the European Union.
Yet while the referendum's results may be difficult to argue with, the manner in which calls for a Brexit are honored is not. In fact, the terms of the United Kingdom's withdrawal have already become the subject of fierce debate within the British government. May's administration even declared recently that it would not share the full details of its negotiation strategy with Parliament. But constant communication between the Cabinet and British lawmakers cannot be easily avoided, for the simple reason that May's government needs to ensure that any EU deal will eventually be accepted by Parliament. May might have little choice but to adjust her goals and tactics as the Brexit process unfolds to gain lawmakers' backing.

The Ambiguity of Article 50

Once an EU member formally announces its intention to leave the bloc, Article 50 of the Lisbon treaty states that both parties have two years to settle the divorce. The country in question then ceases to be part of the bloc when the withdrawal agreement takes effect or when the two-year window closes. Should London and Brussels fail to reach and ratify a deal before the negotiation period is up, the United Kingdom could find itself booted from the bloc without any guarantee of a future relationship with the Continent.
Of course, there are ways to avoid this scenario. The European Union has installed a fail-safe that allows members to extend talks beyond two years if need be. Alternatively, the United Kingdom can request a transitional deal to buy some time to hash out a more permanent agreement. Regardless of what the Lisbon treaty says, the Brexit process is mostly a matter of politics, and the rules can be bent as long as there is enough will to do so. That said, stretching out talks or signing an interim bargain would still require unanimity, making both options subject to manipulation by any number of participants in the process.
Even if the Brexit goes smoothly, the question remains whether it would be reversible. In this, timing is everything: If the United Kingdom leaves the European Union and decides to return, it would have to apply for membership like any other prospective candidate. But the Lisbon treaty is less clear on what would happen if the United Kingdom chooses to remain in the bloc while exit negotiations are still ongoing. Some legal experts say countries can change their minds so long as they are still members of the European Union. Unless British popular opinion substantially shifts, though, London will continue to have just as much reason to seal a deal as it does to start discussing one. Though aborting the Brexit may be legally plausible, it may not be politically feasible.
 
is republished with permission of Stratfor."

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