Brexit: What Happens Next?

Following the victory for Leave in the EU referendum, Prof Stephen Tierney sets out the next steps in the constitutional process. 
 
Initially nothing: the referendum by itself does not change anything in legal terms. The UK remains a member of the European Union until it concludes negotiations on withdrawal, a process that will take at least two years. 
 
Two year negotiation: under the Treaty of European Union states have a specific right to withdraw from the EU. The United Kingdom must go through a process set out by Article 50 of the Treaty. The UK Government will give notice (we don’t know when) to the other European heads of Government - the European Council - that the UK intends to leave. The UK will then negotiate the terms of its departure over a two year period; an extension of this period is possible.
 
If agreement is reached by the UK and 20 of the other 28 Council members (this is the majority required), then that will be formalised. If negotiations do not conclude in agreement the UK can still leave at the end of this period, although the terms of this departure may not be favourable to the UK. 
 
There are various options that could be concluded. One of course is complete exclusion of the UK from any of the EU’s treaty arrangements. That would seem to be very unlikely. Once the dust settles it is clear the Europe would benefit from a suitable trade deal with the UK and vice versa. But this is all for discussion and will depend upon the political mood, particularly among other EU states.
 
Delaying negotiations: the negotiations need not happen straight away. It would make sense for the UK Government to plan this carefully and for a full internal discussion to take place across the parties and the territories of the UK to try to build consensus as to what the UK’s negotiating position should be. The EU and other Member States kept a fairly low profile during the campaign, so it is hard to predict what European reactions will be; it is also important to distinguish public statements from private, diplomatic positions.
 
Can it all be stopped? The referendum result is not legally binding and the PM could simply refuse to notify the EU of an intention to leave. In political terms this is unthinkable (the PM has in any case announced his impending resignation), as is any attempt by Parliament to try to block the negotiations. 
 
Will a deal be done? There are many reasons to believe that in the end both sides will come to an arrangement that sees the UK still connected to the EU in a range of ways. These are:
  • the importance of trade (the UK is a key importer of European goods); 
  • the significance to the EU of the UK’s international status, strategic position, territorial waters and natural resources; 
  • the number of citizens of the EU living in the UK and vice versa; 
  • the EU’s direction of travel: trade deals with external partners are proliferating, for example with the countries of North America. 
But there are potentially huge stumbling blocks: the EU does not want to introduce a pick and mix arrangement that could encourage other Member States to unsettle an increasingly fragile union.
 
There are other complications. For example, the UK’s membership of the WTO is currently dependent upon EU membership, so that will also have to be untangled.
 
Staying in the European Union? The result was a relatively close one: 52%-48%. Could the negotiation deal lead to the UK staying in the EU on very different terms? 
 
There are legal impediments to the Article 50 process being used to renegotiate terms, but the EU does not let legal niceties get in the way of realpolitik when the stakes are high. Some believe that the EU did not want to reveal its hand before the referendum, but may now offer better terms of membership to the UK. Brexit is a headache it could do without. UK ‘leavers’ would have to be brought onside, but many of these are ‘soft-leavers’. The referendum did not offer a mid-way option – a reformed EU, or a better position for the UK within it – beyond the deal negotiated by the Prime Minister. There was no promise of a ‘Smith Commission’ to appease those who want reform. Will the EU try to bring about such a reform? The UK is so embedded within the EU that untangling membership would be a massive task that may in time appear unnecessary. 
 
There is of course a strong argument that this simply won’t happen. Such an accommodation of the UK would surely need treaty reform and would therefore require the unanimous consent of all Member States to any new deal. As I say, it would also open the door for other states to push for reform and better terms. This latter point could well mean that, for Brussels and the dominant forces within the EU, the political cost could just be too high; the danger being that the monetary union itself could collapse. But this issue will be on the table when the dust settles, and over time the gap between a free trade deal for the UK and ongoing membership may start to shrink towards vanishing point.
 
Parliament’s Role: Westminster would still have a significant role to play in offering views in negotiations and in ratifying the exit Treaty (or refusing to do so). 
 
Because of the power Parliament has ultimately to accept or reject a deal, it would also expect to be kept closely informed. This will be a period for parliamentarians to show their mettle, calling the UK negotiators to account, and making sure the people of the UK are as fully-informed as possible. Transparency has not been a characteristic of EU treaty-making and it will be for the Commons and the Lords to insist upon this. It will also be vital for the Scottish Parliament and other devolved legislatures to feed into this process and to scrutinise it energetically.
 
The possibility of another General Election (and devolved elections) before an exit treaty is agreed should not be discounted. Europe would obviously be a major issue in these elections and the results of any elections could impact upon negotiating positions.
 
In the meantime: the UK remains a Member State of the EU and fully subject to its obligations under EU law. This means that is very difficult (in reality impossible) to change any of the current arrangements regarding free movement etc. until the UK has concluded its exit treaty. There can be no immediate ban on free movement of EU citizens for example.
 
Massive job for law-makers: Parliament must also reform UK law. A significant claim of the Leave campaign was the extent to which EU law has been incorporated into UK law. This will all have to be revised - a major headache for legislators and for government civil servants. 
 
There is another point. So big is this task that it will have to take priority over much else, clogging up the parliamentary timetable and presumably putting on hold much of the programme in the last Queen’s Speech. Will there be parliamentary space to take forward the new Wales Bill, reforming Welsh devolution, for example? EU exit will also no doubt preoccupy the devolved legislatures and governments, impacting significantly on the process of government in Scotland, Wales and Northern Ireland over the next few years. 
 
Implications for the Union? Already Scottish nationalists and Irish nationalists in Northern Ireland have made the point that this is not a popular decision in their territories, and that they will oppose exit. Calls for a second referendum on independence in Scotland may intensify, as could calls for a referendum under the Northern Ireland Act 1998 for reunification of Ireland. It is not clear that opposition to Brexit will translate automatically into majority support for Scottish independence (and far less likely for Irish reunification): does Scotland want to be the site of the EU’s territorial border with England? But the devolved territories will offer strong views throughout the negotiation process, and the prospect of Scottish independence may well push the UK towards trying to retain an integrated relationship with the EU. 
 
The Scotland Act 2016 strengthens Scotland’s position in a ‘federal’ direction; strengthening the constitutional status of the Scottish Parliament as a firm partner in the Union. An exit treaty could possibly be pushed through Westminster without the Scottish Parliament’s consent. But this would go against the spirit of the 2016 Act and of devolution as a whole. It could also lead to court challenges, which even if unsuccessful would sour relations between London and Edinburgh in a highly toxic way. The need to carry the devolved territories along in any negotiation process is crucial to the health of the UK. It would be ironic if the UK were to secure its ‘independence’ from Europe, only then to fall apart as a state.
 
Northern Ireland is possibly an even more serious issue than Scotland. The peace process has largely been a success, and a main plank in the thawing of relations across the island of Ireland has been the Common Travel Area between the UK and the Republic of Ireland. It is vital that the slow growth in closer relations across Ireland should not be jeopardised. This is arguably the most important issue for exit negotiations, particularly if there is any question that the peace process is at stake.
 
Points of uncertainty: these could fill a book…
 
There are many known unknowns, most of which are political questions which will hinge on how things play out.
  • What will this mean for the Conservative Party and the Government? The PM has announced he will resign within the next few months. Where do we go from here?
  • What will it mean for Europe? Will other states now seek to reform the EU from within? Will other exit movements across the Continent grow in strength?
  • Will the EU try to see off exit by offering the UK a new deal? If so, would the UK Government be politically able to negotiate a settlement short of exit?
  • What will it mean for the UK economy and indeed for the economies of our European partners, for the pound and the Euro?
It is not a time for predictions. We must wait and see…

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post by Stephen Tierney
University of Edinburgh
24th June 2016
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