UK: Prime Minister Lays Out Her Brexit Plans

Tue, Oct 4, 2016 - 8:19am

British Prime Minister Theresa May used the first day of the Conservative Party Conference on Oct. 2 to make a series of announcements related to the process of leaving the European Union. According to May, the British government will formally notify Brussels of its intentions to leave the bloc (a move commonly referred to as triggering Article 50 of the Lisbon treaty) by March 2017. This will start a two-year process during which London and its EU peers will negotiate the terms of Britain's exit and, possibly, the shape of the new bilateral relations. If this timeline is respected, the United Kingdom would leave the European Union by early 2019.

May also said the United Kingdom intends to retake full control of its immigration policies after the Brexit and to stop answering to the European Court of Justice. These are meaningful announcements because, according to the European Union, countries that want to have full access to the bloc's internal market have to accept EU workers and EU rules. But the prospects of restricting immigration to the United Kingdom and of restoring full sovereignty for the British Parliament were some of the main reasons why voters supported the Brexit.

Read Is the UK Economy Doing Better Post-Brexit?

During her Oct. 2 speech, May rejected the "Norwegian" and "Swiss" options. (Norway and Switzerland are not members of the European Union, but they both have access to the EU common market in part because they accept EU workers.) May also promised to negotiate "an agreement between an independent, sovereign United Kingdom and the European Union," suggesting that London may seek some kind of enhanced free trade agreement with Europe rather than trying to remain fully a part of the internal market. This could be easier said than done, because free trade agreements tend to take a long time to negotiate and, in general, are easier to negotiate for goods than for services. This is not a minor issue considering the size of the United Kingdom's services sector in general and its financial sector in particular. Canada and the European Union recently negotiated a comprehensive free trade deal that offers some hints of the type of arrangement London and Brussels may pursue.

In addition, May said that early next year, the British Parliament will vote on whether to repeal the European Communities Act of 1972, which gives primacy to EU law over British law. British officials said the repeal will enter force only after the United Kingdom leaves the bloc, which means that all EU norms should remain fully active in Britain during the negotiations. This announcement comes at the time when some legal experts are questioning whether May has the power to trigger Article 50 without parliamentary authorization. By confirming that the British parliament will soon be given the chance to vote on the European Communities Act, a key part of the Brexit process, May is probably signaling that parliament will play an important role in Brexit.

Altogether, May's announcements were meant to provide some clarity about her plans amid the widespread uncertainty still lingering more than three months after the Brexit referendum. Donald Tusk, the president of the European Council, welcomed the words. However, May's Cabinet is still struggling to come up with a coherent negotiating strategy. Some are pushing for a "hard Brexit," severing ties with the European Union as fully as possible. Others would like to reach a compromise to preserve as much access to the EU internal market as possible.

Should formal negotiations indeed begin in March, they will coincide with the French presidential election (scheduled for April and May) and the German parliamentary elections (to be held by October 2017), which could affect the bargaining positions of Paris and Berlin. In any case, the British government now has around five months to coalesce around a negotiating strategy that bridges these myriad divides.

"UK: Prime Minister Lays Out Her Brexit Plans" is republished with permission of Stratfor.

About the Author

Global Intelligence Analysis