Some MPs may reject this deal in favour of no deal at all. Others want a further referendum with the option to remain in the EU. Others want a general election and a change of government.
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In principle, all of these options remain open if the Commons voted against the deal. But it is not clear which if any can attract majority support — or whether there is sufficient time without extending negotiations for new national votes, before March 29, Critics say this interferes with the sovereignty of parliament.
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But, to me, this is misguided. As a matter of domestic law, the UK parliament could always act outside the proposed review procedure, which makes any decision to end the backstop arrangements a joint matter to be decided with the EU. But if the UK did act unilaterally, it would have to accept significant international consequences, and almost certainly lose any chance at negotiating a future free trade agreement with the EU. That would be an expensive choice to make, but in this sense parliament should not see the backstop as a limit on its legal sovereignty.
In legal terms, the Draft Withdrawal Agreement is quite an achievement. It enables the UK to leave the EU, while at the same time preserving some — but not all — the advantages of EU membership. The overall structure is as follows. Next, with both parties alert to the fact that the Withdrawal Agreement cannot establish a permanent future relationship, there are complex provisions on the so-called Irish backstop. Finally, the Outline Political Declaration expresses the non-legally binding intention to replace the backstop with an agreement which ensures the absence of a hard border on the island of Ireland.
To the extent that the Withdrawal Agreement refers to union law, it is to be interpreted in accordance with the case law of the Court of Justice of the European Union. I rather feel that there may be too much entanglement with the EU here for Brexiters to swallow; and too much of a step down from single market membership to satisfy Remainers. As such, there are few surprises on this front. The draft Withdrawal Agreement would guarantee a transition period during which the UK economic relationship with the EU remains unchanged.
A no-deal, disorderly exit will be avoided, at least until the end of the transition period.
Business will very much welcome this. It means it will not have to spend resources trying to minimise the severe economic disruption and significant negative effects of a disorderly exit. One concern is how frictionless trade in goods will actually be. Another concern is that the single customs territory applies to goods not services. The latter of course includes financial services and the foreign investment inflows that come with them.
Under financial services, it stipulates that equivalence assessments shall start as soon as the UK departs.
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For business, the good news the deal brings is that short-term uncertainty has been minimised. Given the still very real possibility of a no-deal Brexit, this is arguably the best feature of the agreements. Yet the ad hoc and short-term features of these interim agreements do not bode well for long-term investment planning. The informed consensus remains that Brexit will make the UK permanently poorer over the long run and the agreement does little to change it.
What the deal does is to establish that the economic costs will be smaller than in the case of a no-deal and that they are spread over a much longer period of time. During this period UK commercial policy would have to be in line with EU commercial policy, and the UK cannot make any trade deals with countries outside the EU. The exact shape of the future relationship beyond will be the outcome of negotiations that will only start once the Withdrawal Agreement is approved by both the UK and EU.
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It is not sketched out in detail in either document that makes up the deal on the table. But the list of topics when it comes to economic partnership beyond the transition period is comprehensive and in line with what the EU includes in modern free trade agreements digital trade, intellectual property, government procurement, goods and services are all mentioned. The outline for future relations represents the special nature of this future agreement as it emphasises zero tariffs, fees, charges or quantitative restriction on all goods, and an ambitious customs arrangement.
How the customs arrangement will work after the transition period will be subject to negotiations and the degree to which there is alignment between UK and EU regulations. This would cover arrangements such as the levels of pesticides used in food and the chemicals allowed in paints. It should evolve from the single customs territory established during the transition period. But there is no reason to believe that the UK cannot have an independent trade agreement policy when the transition period ends.
This depends on what long-term relationship the UK negotiates with the EU. The references to services in the draft agreement indicate a desire on both sides to maintain as open a services trading regime as possible, although it is unclear what the ultimate negotiated outcome will be after the transition period. Indeed, the wording is not dissimilar to that found in other trade agreements national treatment, non-discrimination, arrangements on professional qualifications , but the actual degree of market access normally appears in lists and annexes with exclusions, which, of course, have yet to be negotiated.
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