The UK is scheduled to leave the EU on March 29, 2019, but so far the UK has failed to ratify a Withdrawal Agreement. Whether the UK will leave with or without a deal remains unclear, and the analysis changes on a near-daily basis. Regardless of outcome, however, the nature of the UK’s future trading relationship with the EU will need to be determined in a relatively short period, and the product of those negotiations will form the basis of the UK’s future trading relationships with the rest of the world, including the United States. The UK will also have the opportunity to act in other areas post-Brexit – such as tax policy, immigration, and supervision of regulated industries. These developments will significantly impact many global supply chains.
Our colleague Ambassador Matthew Kirk has prepared another in-depth analysis of the current status of Brexit, posted on our dedicated Brexit Legal Page, which you can read below.
Where are we now?
The UK’s progress towards leaving the European Union has been a tortuous and turbulent affair. It has been marked by Prime Minister Theresa May’s Government suffering repeated heavy defeats in Parliament, which would normally have led to a change of policy if not of Government, but carrying on with its Brexit stance unchanged. So you could be forgiven for assuming that a series of votes initiated by backbenchers at the end of February in which the Government suffered no defeats would also signal no change. Not so. Even more paradoxical, the significant change to the Government’s approach at the end of February may make the outcome the Government has been aiming for all along a little more likely.
What happened? In mid-February, the Government headed off a serious push to give Parliament more influence over the process through an amendment tabled by Labour’s Yvette Cooper, by promising more opportunities to vote at the end of the month. Amid rumblings of discontent among the hitherto loyal Brexit Delivery Group (100+ Leave and Remain supporting Conservative MPs who have supported the PM throughout) and the threat of mass resignations of Ministers, at the end of February the PM effectively adopted the Cooper amendment as her own policy, which led Cooper to propose a further amendment designed to bind the PM to stick to her commitment – this passed with a very comfortable majority, though around 110 Conservatives failed to support it (most abstained, 22 voted against).
What does it all mean? On 12 March, Parliament will vote again on the Withdrawal Agreement, with whatever adaptations the Government has been discussing with the EU (see below for the likely status of these). If Parliament accepts, this will form the basis for the UK’s departure from the EU. If not, on 13 March Parliament will vote whether to proceed to leave the EU with no deal. If Parliament declines to do that, it will vote on 14 March whether the Government should request an extension to the Article 50 deadline of leaving the EU on 29 March.
If the Withdrawal Agreement does not pass on 12 March, it is virtually certain that Parliament will then vote against “no deal” and to ask for a delay to the Brexit process, in the belief that the EU will grant such a delay. The risk of a “no deal” exit on 29 March has therefore been reduced to close to zero (though of course the EU has also to agree any delay – see below), but, as the PM was at pains to stress in Parliament, delay does not remove “no deal” at the end of the delay period. The Parliamentary arithmetic however seems inexorable. It is doubtful that, as some have asserted, the risk of “no deal” was putting much pressure on the EU side of the negotiation: the EU can read the Parliamentary arithmetic as well as anyone. The moves in Parliament at the end of February increase the likelihood that Parliament will assert the majority against “no deal” Brexit into the future.