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The Brexit Vote: Key Elements Behind the Withdrawal Negotiations

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2019-09-23 15:35:07
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Brexit For Dummies
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The Brexit vote has created uncertainty. Many are speculating as to what relations will look like in a post-Brexit world. To get a better handle on what to expect, let’s take a look at the key elements behind the Brexit vote.

Brexit vote ©Shutterstock/lazyllama

The withdrawal negotiations between the UK and the EU seemed to go on forever, but really they’re just the tip of the iceberg.

That’s because the withdrawal agreement only covers the UK’s departure from the EU. It doesn’t agree on critical elements of the future relationship between the two, such as trade. The withdrawal agreement is purely about getting the UK out of the EU in an orderly manner.

Trade negotiations — and agreements that cover cooperation in areas like security and defense — will not begin until after the UK has left the EU. This was a big area of misunderstanding for a lot of people, who assumed the “Brexit deal” was essentially a trade deal.

So, what does this orderly exit involve? To ensure the UK’s exit would be as smooth as possible, the two sides negotiated the following key points as part of the withdrawal agreement:

  • The divorce bill, or how much the UK has to pay to cover its existing commitments to the EU.
  • The transition period (also known as implementation period), which is designed to ensure a controlled transfer, and give governments and businesses time to prepare for life after Brexit.
  • The rights of EU citizens already living in the UK (and the rights of UK citizens living in the EU) to retain their residency status after Brexit. Also, that the free movement of people would continue until the end of the transition period. Theresa May had made it clear during negotiations that free movement of people would have to end after the transition period — it was one of her “red lines” that she refused to budge on.
  • The fact that the UK will have to abide by EU laws for the duration of the transition period — something that raised a lot of eyebrows among Brexiteers.
  • How to avoid a hard border between Northern Ireland and the Republic of Ireland. The withdrawal agreement includes a provision for a temporary customs union between the UK and the EU until a trade deal is agreed upon, and this is known as the This backstop measure proved extremely unpopular among Brexiteers (and even many Remainers), even though it was designed to prevent a hard border and protect peace on the island of Ireland.

The UK’s ongoing relationship with the EU in areas such as trade is not part of the withdrawal deal because none of that has been negotiated yet. The political declaration sets out a vague aim to agree on a trading relationship that’s as close as possible, but it avoids any specific details.

Deal or no deal? The Brexit deal goes down to the wire

Although the EU27 leaders signed off on the withdrawal agreement and political declaration, Theresa May had her hands full trying to get approval from the UK Parliament.

The original Brexit vote, which was scheduled for December 2018, was postponed at the last minute when it became obvious that almost no one in Parliament was prepared to support the deal. The Irish backstop was the main objection for most people, amidst concerns that it could inadvertently trap the UK in a permanent customs union with the EU — without the option to withdraw from that customs union in the future.

The Brexit vote eventually took place in January 2019, at which point the UK Parliament spectacularly rejected (by a record majority) the Brexit deal that May and her team had spent almost 18 months negotiating.

But, like a fading Hollywood franchise that refuses to die, Theresa May brought the withdrawal deal back for a second vote, and a third, both in March 2019. Both times, Parliament rejected the Brexit deal. With just a couple of weeks to go until the intended exit date, the UK was on the verge of crashing out of the EU with no approved deal, meaning no transition period and potential chaos for UK businesses.

The EU looked on open-mouthed as chaotic scenes unfolded in Parliament. Meanwhile, the British public (and their Parliament) split further into factions: Some wanted to leave the EU with no deal, some wanted to delay Brexit and start negotiations again, some called for Brexit to be canceled altogether (a prospect that the EU had paved the way for when it agreed that the UK could just revoke Article 50 without getting the EU’s agreement), and many called for a second EU referendum.

At this point, MPs voted to wrestle control of the Brexit process from Theresa May and her government, meaning they could begin to debate their own ideas on how to get Brexit done. Unfortunately, this didn’t work out either — it became glaringly obvious that there was no consensus on how best to leave the EU.

All sorts of options were proposed: Leave the single market but remain in the customs union, leave the customs union but remain in the single market, have a second referendum on whatever deal is agreed upon, have a nice cup of tea and watch Killing Eve. (Okay, the last one is made up, but you get the idea — it seemed everyone had a different idea on how best to proceed.) All options were rejected. So, they voted on Brexit again. And all options were rejected again.

As one British newspaper put it at the time, MPs took back control of the Brexit process, only to discover that they didn’t know what it was they wanted.

Amidst all the confusion, the EU took matters into its own hands and decided to extend Article 50 until April 12, 2019 — an extension of two weeks to help get something, anything, through Parliament. This short extension wasn’t enough, though, and the EU and the UK then agreed on another extension, pushing the Brexit date back to October 31, 2019.

If this painful process proved anything (beyond the UK’s incredible talent for comedy), it’s that Brexit means different things to different people. Remember that the referendum was a simple in/out vote. People were asked, should the UK remain in the EU or leave? Those who voted leave weren’t voting for a particular type of Brexit on the ballot sheet; they were just voting to leave. Therefore, some of those who voted out undoubtedly had a hard Brexit in mind, while others will have leaned more toward a softer Brexit and maintaining close ties with Europe.

Therefore, when politicians talk about Brexit being “the will of the people,” what they’re really doing is interpreting their own version of the Brexit referendum result in line with their political position on Europe. As such, “the will of the people” has been used as an argument for a no-deal Brexit by hardliner Conservatives. Meanwhile, the opposition Labour Party, has interpreted the “will of the people” as meaning a softer Brexit.

About This Article

This article is from the book: 

About the book author:

Nicholas Wallwork is a leading international real estate market commentator, entrepreneur, business leader, investor, developer, and author. In addition to heading several real estate and investment companies, he wrote Investing in International Real Estate For Dummies and has produced and presented real estate TV shows on the UK's Sky TV.
www.nicholaswallwork.com