Britain Leaves – What’s Next?


Yesterday, British citizens went to the polls to determine the future of their country. More concretely, the question on the ballot paper (approved by the Election Commission) read as follows: “Should the United Kingdom remain a member of the European Union or leave the European Union?”. At 4:40 am British Standard Time, the BBC called the referendum for the Leave option. This was confirmed shortly after 8:00 am BST, when the head of the Election Commission announced the following result:

REMAIN: 16,141,241 (48.1%)

LEAVE:  17,410,742 (51.9%)

Whilst I will have much more to say about this choice, I think it is best to first address the most natural questions that will arise. A more opinonated commentary post will come sometime tomorrow, once my feelings are a tad less raw. What happens next in the United Kingdom and Europe?

I have tried to look at four questions that arise as a result of the Leave victory, especially from a legal and political perspective.

Is the referendum binding? Can it be overturned?

That’s one question I have seen among some of my British friends, as well as wider social media today. Technically, there was no need for this referendum: Britain’s political system is based on the idea of parliamentary sovereignty. Parliament is supreme and its will has to be deferred to by the courts. Obviously, membership of the European Union did challenge that to some extent. Nonetheless, all the UK needed to do was to pass a bill repealing the European Communities Act 1973 (in its new manifestation) by a simple majority in three separate readings (and a similar procedure in the House of Lords) and then notify the EU of its intention to depart. According to UK law, a repeal would have taken effect upon such a bill receiving Royal Assent by Queen Elizabeth II.

However, in his 2013 speech, David Cameron promised an In/Out referendum on the country’s EU membership. This referendum was enabled by the European Union Referendum Act 2015 – it is legally not binding upon this or any future Parliament. But that is merely the legal position. The political reality is simple: after a public debate of four months involving all political heavyweights, as well as a (for Britain) strong turnout of 73% on Referendum Day, it would quite simply be an act of collective political suicide for all political parties backing such a move.

The Conservative Party, already riven into factions of various shades of Eurosceptics and an ever-decreasing number of EU supporters, would split right down the middle. The Labour Party which has not recovered from its catastrophic 2014 general election performance in Scotland (when it was basically wiped out) has now been dealt another major blow, as the party’s recommendation for Remain has been soundly rebuffed. Jeremy Corbyn, the Leader of the Opposition and a soft Eurosceptic himself, only half-heartedly campaigned for Remain – starting very late to openly call for working-class Labour voters to mobilize for EU membership. In the process, it was working-class voters and the lesser educated who opted by large margins to support the UK’s withdrawal from the EU. An attempt to overturn a democratic vote would surely lead to Labour’s decimation in its remaining working-class heartlands in the north and the Conservative Party’s defeat in many Middle England and Home Counties constituencies at the next general election.

Another problem is the margin of victory for the Leave campaign. With a margin of 1.3 million votes over Remain, the Leave option has scored a clear, unambiguous victory. Despite talk among some Leave voters of a plot to rig the vote, it seems that MI5 had better things to do. No doubt, had the result been the other way around, conspiracy theorists would have tried to find all kinds of reasons to delegitimize the result. Perfidious, but alas – not a reason to cancel the vote.

The short answer is: Legally, this can be overturned. Politically, it would be suicide for any Prime Minister backing this approach. Any party supporting a reversal of the referendum decision via an Act of Parliament would play right into the hands of Nigel Farage and his UK Independence Party which (alongside many Leave campaigners) also ran against “Westminster elites” and “sending them a message”. His party would win dozens of constituencies, with many Conservative and Labour Party MPs being turfed out and Farage’s United Kingdom Independence Party then holding the balance of power in a new Parliament.

Will there be a second referendum, like in Ireland?

No. Even though there are cases like Denmark’s rejection of the Maastricht Treaty or Ireland’s rejecton of the Nice Treaty, when the EU offered a new deal to the Member State concerned. However, this was due to the constitutional requirements necessitating a Treaty change (that’s what the Maastricht and Nice Treaties were in relation to the EEC Treaty). However, this was an optional referendum on the issue of membership itself, which itself was triggered by the Prime Minister after a modest renegotiation of the terms of membership with the European Union. After the somewhat rushed renegotiation, it was made clear by various heads of state & government, as well as EU officials, that a decision for “Leave” would mean the withdrawal of the United Kingdom – and that such a vote would not be allowed as a renegotiation tactic to get a better deal. In fact, the governments of Spain and Belgium lodged official reservations that the renegotiation deal to Prime Minister Cameron would not be improved, altered or renegotiated. As of this late morning, the European Union has annulled said deal, as the precondition for the deal (namely a Remain vote) hasn’t been fulfilled.

Whilst a future Prime Minister could withdraw the notification (in the event of a change of government, which appears unlikely as the Conservative Party commands an absolute majority in the House of Commons), it would amount to political kamikaze and, a second referendum, if called would result in yet another acrimonious divisive campaign with the electorate almost certain to reject such an approach. Given that the European Union wants to avoid other Member States (say, Denmark or the Netherlands) to use referendums as weapons of negotiation to get their own special statuses, it is highly unlikely that the United Kingdom will be offered a new settlement improving upon the conditions offered to David Cameron and presented in Thursday’s national referendum.

What is Article 50 TEU all about?

The only provision dealing with withdrawal is  Article 50 of the Treaty on European Union (TEU), which governs the withdrawal of any European Union Member State. I have posted it in full, with my comments in bold script.

Article 50(1)

“Any Member State may decide to withdraw from the Union in accordance with its own constitutional requirements.” This essentially means that every Member State of the European Union has the right to withdraw in line with its national constitutional framework (usually enshrined in a written constitution; but in the United Kingdom, this is laid down in a series of laws and documents deemed to be of constitutional status, including the Human Rights Act 1998, the Magna Charta, the Parliament Act and the European Communities Act 1973). According to the UK system of government, the provision of “in accordance with its constitutional requirements” would have been complied with upon Parliament repealing the European Communities Act 1973 after three readings in the Houses of Parliament.

Article 50(2)

“A Member State which decides to withdraw shall notify the European Council of its intention. In the light of the guidelines provided by the European Council, the Union shall negotiate and conclude an agreement with that State, setting out the arrangements for its withdrawal, taking account of the framework for its future relationship with the Union. That agreement shall be negotiated in accordance with Article 218(3) of the Treaty on the Functioning of the European Union. It shall be concluded on behalf of the Union by the Council, acting by a qualified majority, after obtaining the consent of the European Parliament.”

The key word is “notify”. Presumably the notification will be carried out by means of a formal letter by the Prime Minister of the United Kingdom to the President of the European Council and the President of the European Commission informing them of the United Kingdom’s formal intention, in accordance with the intent expressed by the electorate in the 23 June referendum, to formally withdraw from its membership of the European Union. In this concrete scenario, David Cameron has already announced that he shall no longer be available to serve beyond the Conservative Party’s annual conference in October.

He has also indicated that he will not be participating in negotiations regarding the terms of the United Kingdom’s departure from the European Union. The new Prime Minister may very well be inclined to seek a fresh mandate in the general election (especially as the current opposition Labour Party is in a complete shambles, due to the lacklustre performance by Jeremy Corbyn as Leader of the Opposition – and many blaming him for doing the bare minimum to support a Remain vote in the referendum campaign). This may further delay a notification. Meanwhile, both the President of the European Commission, Jean-Claude Juncker and the President of the European Parliament, Martin Schulz, have expressed their dismay at the British decision to leave, and have demanded that the notification be triggered “without delay”. However, they have no formal means to force the current Prime Minister to provide said notification at this time. Informally, they could make any negotiations on the future economic relationship between the United Kingdom and the European Union dependent on a “proper and prompt notification”. Given that this is the first real legal precedent of a Member State expressing its desire to leave, it is likely that Messrs Juncker and Schulz will seek to avoid the impression that a Member State can delay the consequences of a withdrawal until a time of its convenience. Boris Johnson, the former Mayor of London and one of the frontrunners to succeed David Cameron, has basically attempted to take the line that notification can be delayed.

Since David Cameron is unwilling to carry out more than caretaker functions until October 2016, and since the new Prime Minister may wish to dissolve the House of Commons before beginning a full-blown negotiation (due to the Fixed-Term Parliaments Act 2010, the new PM would need to obtain a two-thirds majority to dissolve the House of Commons prior to the expiry of the current Parliament’s term in 2020) with the European Union. It’s safe to say that the notification may not happen until November or December 2016, which would give the UK time until possibly 31 December 2018 to negotiate a new relationship with the European Union. It is therefore likely that the United Kingdom will formally cease to be a Member State of the European Union on 1 January 2019, at the stroke of midnight.

Article 50(3)

“The Treaties shall cease to apply to the State in question from the date of entry into force of the withdrawal agreement or, failing that, two years after the notification referred to in paragraph 2, unless the European Council, in agreement with the Member State concerned, unanimously decides to extend this period.”

There are two ways how the United Kingdom will end its membership of the European Union – colloquially speaking, there is the comparatively easy way and the hard way. The comparatively easy route is for the United Kingdom Government (probably led by a new Prime Minister, who will emerge after the Conservative Party conference in the autumn) to formally negotiate on the terms of the withdrawal – including the division of assets, any remaining obligations of the United Kingdom, the apportionment of membership contributions, the UK presidency of the European Council (technically due in 2017), the status of EU citizens in the United Kingdom, the status of UK citizens in the European Union and a number of other matters. The UK and the EU will have two full years to negotiate such an agreement. Note that this the agreement referred to is only going to cover the most fundamental aspects of the UK’s obligations in the wake of withdrawal. It is very unclear which model will be adopted. As I have already discussed in this post, none of the publicly discussed options looks politically palatable (whether the Swiss, Norwegian or Icelandic model) – primarily because the EU makes freedom of movement a prerequisite for EEA countries to access its Single Market. The Leave campaign expressly campaigned against freedom of movement and on the theme of “taking back control” over the UK borders (despite the fact that the UK was never part of the Schengen passport-free zone or the Dublin II asylum system). Under these circumstances, it is difficult to see how any new Prime Minister can possibly agree to freedom of movement without having his/her term cut short by a full-blown backbench rebellion in the House of Commons. Conversely, Messrs Juncker and Schulz cannot agree to a deal that will exempt the United Kingdom from the usual obligations to accept freedom of movement for EU citizens. Thus, both sides find themselves in a potentially unsolvable dilemma, as it would require one side to soften its adherence to core principles: freedom of movement in the case of the EU, its rejection by the future United Kingdom Government executing the mandate for negotiation conveyed to it via yesterday’s national referendum.

This brings us to the “hard option”. If the United Kingdom Government and the European Union negotiation team are unable to conclude a formal agreement on the legal, political and financial aspects of withdrawal, then the United Kingdom will cease to be a Member State of the European Union. In other words, its duties within the EU (membership contribution, duty to enforce European Union law via its courts) will end, but so will all the rights associated with said membership: British citizens will cease to be EU citizens, with all those rights (including the right to live, study, work and travel in the other 27 Member States) no longer applicable. In theory, unless bilateral agreements are reached, UK nationals would have to apply for visas for EU countries. The UK will no longer participate in the proposal, initiation or execution of new European laws (or even their discussion). Further, UK officials at the European Institutions (the European Commission, the European Parliament, the European Court of Justice, the European Investment Bank, the European Central Bank and the other EU agencies et cetera) will most likely see their employment being terminated, given that they will no longer be nationals of the European Union (a status ancillary to your country’s membership of the EU). UK students will no longer be entitled to Erasmus grants, UK researchers will no longer receive research funding, and structurally weak regions like Cornwall which received substantial EU funding (and still, in a cruel twist of irony voted to Leave by a decisive margin) will no longer be entitled to any EU assistance. The United Kingdom, as already discussed numerous times during the referendum campaign, will be a third country for the purposes of trade with the residual European Union (i.e. the EU27) – the disadvantageous World Trade Organization rules will apply, permitting both the UK and the EU to place tariffs on each other’s goods.

Article 50(4)

“For the purposes of paragraphs 2 and 3, the member of the European Council or of the Council representing the withdrawing Member State shall not participate in the discussions of the European Council or Council or in decisions concerning it.”

That’s a simple one. Basically, while the United Kingdom remains a member of the European Union (until either an exit deal is reached within the two-year period or until it leaves upon failure to reach such a deal), it will be excluded from any discussions which concern the withdrawal negotiations.

“A qualified majority shall be defined in accordance with Article 238(3)(b) of the Treaty on the Functioning of the European Union.”

The minimum for decisions on the withdrawal deal comprises 72% of the Member State votes representing 65% of the population.

Article 50(5)

“If a State which has withdrawn from the Union asks to rejoin, its request shall be subject to the procedure referred to in Article 49.”

Should the United Kingdom, upon having left the European Union, ever decide to change its mind (for example due to a change in government towards Labour or a Labour/Liberal Democrat coalition, constellations which are both Europhile – as opposed to the deeply Eurosceptic Conservative Party; a change of government has previously influenced applications in Malta and Iceland, for example), then it will be subject to the exact same procedures for accession as every other Applicant State.

It would be subject to the Copenhagen Criteria (which it easily fulfils; i.e. democracy, rule of law, independent institutions etc), but more importantly would have to swallow an obligation to, firstly, join the Euro, the Schengen zone and probably the (currently de facto defunct) Dublin II asylum system. The terms would need to be negotiated between any future United Kingdom Government and the European Union. It would then be presented to the European Parliament, as well as the 27 national legislatures (and heads of state) for their ratification and assent.

For the avoidance of doubt, the European Commission has made it clear that the special status negotiated by Prime Minister Cameron in February – namely exempting Britain from the Euro, political union, Schengen, any integration measures, EU foreign policy, restricting access to welfare benefits to EU nationals – have now lapsed. Any future UK Government will be forced to accept the standard canon of EU law.

Will Scotland now declare independence?

Yesterday, Scotland (like London and Northern Ireland, but unlike England & Wales and the entirety of the United Kingdom) voted decisively to remain a member of the United Kingdom – with 65% of the popular vote in Scotland. Nicola Sturgeon, the First Minister of Scotland (and arguably, the star campaigner during the last independence referendum in 2014) has made it clear that the Scottish Government regards the impending withdrawal of the United Kingdom as a “material change” from the circumstances that led to the rejection of independence in 2014.

The reason? Many of those who voted against Scottish independence did so because independence would have meant Scotland (upon independence as a new state) ceasing to be an EU member and having to re-apply. Obviously, with Brexit a reality now, the First Minister can plausibly argue that achieving independence and applying for EU membership then is the only way Scotland can retain the benefits of being in the EU. Given that Sturgeon won the recent Scottish assembly election on a manifesto keeping an independence referendum open in the event of just such a “material change”, a referendum on independence in the next 12-18 months, prior to the UK leaving the EU, looks increasingly likely. Action may be delayed by the fact that the First Minister narrowly missed an outright majority in the Assembly – but public pressure in Scotland may force the other parties in the assembly to assent to such an independence referendum. The First Minister has already announced that she plans to introduce fresh legislation for a second independence referendum within the next few weeks.




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