EU Negotiation Guidelines

On 19th April 2017, the EU Council (excluding the UK) adopted guidelines setting out its position on the negotiations with the UK in relation to its withdrawal from the EU. The guidelines defined a framework for the negotiations under Article 50 and set out the overall position and principles which the EU would pursue through the negotiations.

There would be a phased negotiation beginning with priority issues for the Withdrawal Agreement. If sufficient progress was made on these issues, there was a willingness to open informal discussions on the framework for the EU and the UK’s future relationship. It would be a matter for the heads of state to determine when sufficient progress has been made.

Article 50 provides that the Withdrawal Agreement should take account of the framework for the future relationship between the EU and UK. In accordance with the EU Council negotiation guidelines, once sufficient progress was made on the withdrawal negotiations, discussions would begin in parallel on the scope and shape of the arrangements for EU’s future relationship with the UK.

The guidelines stated that the main purposes of the negotiations were to ensure the United Kingdom’s orderly withdrawal so as to reduce uncertainty and to the extent possible, minimise disruption caused by this abrupt change’.

The first phase effect dealt with the divorce issues. They related to settling “the disentanglement of the United Kingdom from the Union and from all rights and obligations the United Kingdom derives from commitments undertaken as a member state. “

The EU negotiation guidelines emphasised that the EU stood ready to initiate work towards an agreement on trade to be finalised and concluded once the United Kingdom was no longer a member state. It indicated that any free-trade agreement should be balanced ambitious and wide-ranging but could not ‘however amount to participation in the single market or parts thereof as this would undermine its integrity and proper functioning.

It also made clear that the agreement must ensure a level playing field notably in terms of competition and state aid, and in this regard encompass safeguards against unfair competitive advantages through inter-alia tax, social, environmental and regulatory measures and practices.

The guidelines also provided that the negotiations would be conducted by the EU as a single block. There would be no negotiations with individual states, and the UK would engage exclusively through the channels set out in the guidelines and in negotiating directives.

EU Negotiating Team

On 22 May 2017, the EU Council excluding the UK, adopted the decision authorising the opening of Brexit negotiations and adopted negotiating directives. The mandate is given by special qualified majority (72% members (20) with 65 per cent of the population of the states). They emphasised the necessity for an orderly withdrawal including the matters of citizens’ rights, a financial settlement, and the situation in Ireland as well as other matters in which there was a risk of legal uncertainty as a consequence of Brexit.

The EU appointed former French Foreign Minister, Michel Barnier as its chief negotiator. Ultimately, the heads of government and states coordinated by the European Council President Donald Tusk, supported by the Council’s Brexit taskforce were heavily involved in the negotiations, given the requirement that it be ratified by the EU Council.

The European Parliament is required to consent to the proposed agreement on withdrawal by a simple majority, including members of the parliament representing the withdrawing state. The Council must conclude the agreement by a special qualified majority vote.

The European Parliament appointed former Belgium Prime Minister leader of the Alliance Democrats group, Guy Verhofstadt as its coordinator for negotiations. The parliament’s conference of presidents established a steering group on Brexit to assist Mr. Verhofstadt.

UK Negotiation Arrangements

From the UK side, the matter of agreeing on the terms of withdrawal and the agreement of a future arrangement rested primarily with the nearly established Department for Exiting the European Union. Other departments such as the Department for International Trade, the Department for Business and the Treasury were also intimately involved in the negotiation process.

The House of Commons established an Exiting the European Union Committee. Other select committees of both the House of Commons and the House of Lords examined many aspects of Brexit and published many reports with the assistance of parliamentary services.

Parliament had no direct role in the negotiations. However, Parliament had the ultimate power over the government, as later developments and the second Gina Miller case showed.

The Constitutional Reform and Governance Act 2010 allows parliament to block ratification of a treaty. The Lords may indicate dissent, but this may be overridden with Commons support. There are some exceptions.

The UK government was primarily responsible for agreeing on an exit/Withdrawal Agreement and if possible, a new agreement or arrangement for the future relationship between the United Kingdom and European Union. It undertook to consult with the devolved administrations in Scotland, Wales, and Northern Ireland. Many of the EU powers and areas repatriated under Brexit fall with the competence of the devolved legislatures in Scotland, Wales, and Northern Ireland.

Under the Sewel Convention, which is not legally binding, the UK parliament does not legislate on matters within the competence of the devolved legislatures without their consent. The Supreme Court decision in the Miller case conclusively determined that the matter of leaving the EU was one for the UK government. There was no role for, or consent required from the devolved governments.


Negotiations Begin

Negotiations began on 19 June 2017. David Davis, the Brexit Secretary, had promised before the election to oppose the EU negotiation directions and sequencing. He pointed to the difficulty if not the impossibility of resolving the issue of the Northern Ireland border without knowing the future trade relationship. Nonetheless, the UK accepted the EU timetable and the sequencing which the EU had required. There would be no discussions on transitional arrangements or the future relationship (including, in particular, the trading relationship) until sufficient progress had been made on the key issues identified in the negotiation directives.

Negotiations focused on three principal topics the right of EU citizens living in Britain and British citizens living in the EU 27, Britain’s outstanding financial obligations under various EU commitments and the border between Northern Ireland and the Republic of Ireland. It was accepted at an early date that a transition or implementation period would be required during which the UK would leave the EU institutions but remain subject to all the rights and obligations of EU membership.

Moving to Second Phase

Theresa May was very anxious to secure that negotiations would move on to the second phase by October 2017 EU Council, as it was less than 17 months before the scheduled Brexit of date of 29th of March 2019 and businesses were applying pressure to ensure that there would be greater certainty so they could plan for the coming budgetary periods.

The Prime Minister Theresa May in her Florence speech on 22 September 2017 indicated that the UK would honour its commitments made during membership. This was received favourably by the EU, but there followed some months of debate and disagreement as to what exactly the commitment meant. The Brexit Secretary sought to defer quantification of financial obligations until the second phase of negotiations.

Ultimately disagreements continued in relation to the UK liabilities and EU negotiators were not prepared to recommend to the October 2017 EU Council that negotiations would move to the second phase. The next scheduled EU Council was in December, and there was growing business and political pressure in the UK to ensure that negotiations would move to the second phase.

Ultimately the UK largely accepted the definition of its obligations in the terms sought by the EU. By this stage, it seemed very likely that a transition period would be incorporated in the agreement which would give considerable certainty for business.

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