Rethinking Europe

Message to London: Divorcing Is Hard to Do

The former Irish prime minister on the difficulty of pulling out the 40-year-old threads that bind the UK and the EU together.

Credit: Philip Lange, Shutterstock.com

Takeaways


  • Many in London believe that Brexit can be achieved without any major disruption of commerce.
  • Article 50 means there will be two negotiations: -- “Withdrawal” and “Framework” of the future relationship.
  • UK doing trade deals with other countries while in the EU will complicate the efforts of Liam Fox.
  • EU now has to devote itself to unravelling 43 years of interweaving between Britain and Europe.

Many of the real thinkers in London currently have far too cheery a perspective on achieving Brexit. They believe it can be done without major disruption of commerce.

Many even believe that the UK government is in control of the timing and that the UK can preserve most of the benefits (EU market access), while getting rid of the things it dislikes (EU budget contributions and migration).

While many acknowledge that the UK is going through a bad stretch now, they expect an export boost due to the lower exchange rate.

UK too optimistic

It will not be so easy. All commerce relies on commonly understood rules, and there must be consensus on how the rules can be updated.

Disengaging the UK from the EU, and from the rules the EU has been making on the UK’s behalf, will be like undoing all the stitching of a patchwork quilt and then re-stitching some parts of the quilt together, while making a new quilt of the rest.

The UK is, at the moment, stitched into thousands of regulations and international treaties, which it made as a member of the EU over the last 43 years.

Each piece of stitching will have to be reviewed both on its own merits and for the effect which the rearranging might have on other parts of the quilt.

This is, first and foremost, a problem for the UK itself.

It certainly doesn’t help that the UK, unlike Germany or any other major European nation, doesn’t have a reliable constitutional structure or a federal system that could be depended upon to manage the change process. Things in the UK are very London-centric.

What UK goals?

As if that weren’t bad enough, nobody even in the Conservative government itself has a clear idea what UK voters voted FOR on June 23. The Brexit vote, narrow though it was, encapsulates a hodgepodge of reasons, many of them contradictory to one another.

Many voted to leave because they wanted more protection from global competition. Others wanted to get out of the EU, so they could deregulate their economy and dispense with EU social rights.

Their ultimate goal is to promote more global competition and lower costs (wages) in the UK economy – the direct opposite of what many voters actually desire.

It will be very hard for Theresa May to square these goals. But she has to do so before she can proceed much further. The UK government must have a clear sense which set of economic policies it wants to pursue. Only on the basis of that choice can it then decide what sort of relationship it wants with the EU.

Two negotiations

Article 50 of the Lisbon Treaty says a Withdrawal Treaty must take account of the “ framework” of the withdrawing country’s “future relationship” with the EU.

Accordingly, I believe Article 50 means that there will be two negotiations:

  • one on “Withdrawal” and
  • one on the” Framework” of the future EU-UK relationship.

I believe the two treaties must be negotiated simultaneously and in parallel. Look at it from the perspective of my home country, Ireland.

Ireland cannot afford to wait until the UK is already a “third country” (meaning that it has actually withdrawn from the EU) before border, travel and residency issues between Ireland and UK are sorted out. We need these issues sorted out before the UK leaves.

It will be like a divorce negotiation

As with a divorce, the Withdrawal Treaty will be about dividing up the property. This part may be relatively easy to negotiate.

The Framework Treaty will be about the future, and like marital disputes about access to and care for children, this one will prove to be much more harder to conclude. The subject matters it deals with are fraught and complex.

Nobody knows yet what the UK will look for. The 27 EU leaders rightly insisted that the four freedoms – freedom of movement of people, goods, capital and services – go together. Nobody has any idea yet how the UK will propose to get around that.

UK cannot make deals with others, while it is still an EU member

Until it leaves, the UK is still a member of the EU and is bound by all EU rules. It will fully participate in all key EU decisions, except those concerning its own exit terms.

UK’s hands far more tied than London realizes

This means that the UK cannot do trade deals with other countries, while still in the EU. This will greatly complicate the efforts of Liam Fox, the UK’s new Minister for International Trade.

He wants for the UK to leave the EU Customs Union, so he can negotiate trade agreements with countries outside the EU.

He may have made those plans without a full understanding of the UK’s legal commitments inside the EU. Indeed, it would appear he cannot even enter into commitments about future deals, particularly ones that might undercut EU negotiating positions.

This is because, as long as it is still an EU member, the UK must, under Article 4 of the Treaty, act in “sincere cooperation” with its EU partners.

The meaning of “sincere cooperation” was elaborated by the European Court in judgements it made on cases the European Commission took against Germany and Greece.

In those cases, the court overturned separate understandings each of those two countries had forged with other countries, on matters that were EU responsibilities without EU involvement.

Thus, in order to ensure that he stays within the law, Liam Fox may have to take a European Commission official with him on all his trade travels around the globe, at least until the UK has finally left the EU. Can you imagine the disgrace to the sovereignists?

The UK should not be rushed into triggering article 50

Indeed the more closely the UK government looks at its options, the longer it may take to decide when to trigger Article 50.

The leaders of the EU 27 should not rush the UK on this. Short-term uncertainty is a very small price to pay for avoiding a botched and ill prepared exit negotiation. Everyone would lose from that.

In that context, it is important to recall that the UK civil service did not, expect to find itself in this position. After all, UK civil service studies, done long before the Referendum, concluded that the UK’s then existing relationship with the EU was just about right.

The civil servants evidently assumed a higher degree of rationality in the electorate at large than manifested itself on June 23, 2016.

Another reason to go slow with triggering Article 50 is this: Once it is triggered, the UK cannot, easily or legally, change its mind and revert to the status quo, even after a General Election.

A major distraction from other vital work

Meanwhile, Europe really has so much other work to do. Under present circumstances, there is little appetite or stamina to devote a great amount of political energy and attention to the minutiae of EU divorce law, just because three percentage points of Britons than what would have defeated the referendum felt that way.

As things stand, the EU now has to do the completely inopportune thing and devote itself to unravelling 43 years of interweaving between Britain and Europe.

All this highly demanding technical work has to be done, at a time when Europe should be looking outwards towards the opportunities and threats of a rapidly changing and unstable world.

The clear sentiment of a total misapplication of political energies and intelligence will not do anything to grease the wheels of compromise with the UK in the minds of many Europeans.

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About John Bruton

John Bruton was the Prime Minister of Ireland from 1994 to 1997. He served as the EU Ambassador to the United States from 2004 to 2009.

Responses to “Message to London: Divorcing Is Hard to Do”

Archived Comments.

  1. On August 1, 2016 at 8:25 am James Maxeiner responded with... #

    Thanks Mr. Bruton for a clear statement of many of high hurdles leavers should have addressed before the vote. What were they thinking?

  2. On August 1, 2016 at 8:04 am slightly optimistic responded with... #

    Wonder what’s preventing the British-Irish Council, headquartered in Scotland, from acting. As part of the ‘Good Friday’ agreement the BIC was established to facilitate the harmonious and mutually beneficial relationships among the people of these islands in matters such as the European Union.
    http://www.bbc.co.uk/news/uk-scotland-scotland-politics-36860758

  3. On August 1, 2016 at 1:08 pm Agnostic responded with... #

    Many thanks, Mr. Bruton for a lucid presentation of the dual task ahead.

    On the mechanics, I may quibble with the statement: “As with a divorce, the Withdrawal Treaty will be about dividing up the property. This part may be relatively easy to negotiate.”

    To give a flavor of submerged issues: when A/S/FL left EFTA in 1995, they had to pay over a one-year’s contribution to the EFTA Secretariat budget in order to be rid of the guarantee of the EFTA Pension Fund. The UK has been in the EU since 1973 and may have accumulated many such implicit liabilities. The separation bill may be egregious.

    The WTO issue is an other sleeping bomb. UK’s membership has been in mothballs since 1973. The process of reviving the membership – with its rights and obligations to all other WTO member states – is decoupled from the Brexit process. Whether it will be finalized in good time is anyone’s guess. the speaker for the State Bank of India has already signaled that the WTO concessions of both EU and UK wold have to be renegotiated. if India and other countries try to do the same – good luck.

    On the interior front, the UK will have to develop an agriculture and fisheries policy from scrap. Does HMG have the expertise?

    The issue, however, is foremost political and psychological. Assume the negotiated dual deal is not to the UK’s liking – quite possible. What then? Will the UK rise from the negotiating table and say: “Too expensive. Let’s be friends again!” The loss of face, even more, the loss of trust involved in this walk to Canossa would hobble the EU for decades. It would be rejected.

  4. On August 1, 2016 at 5:44 pm toonpaddymal responded with... #

    The head of the State Bank of India? Is that a serious authority to you.

  5. On August 1, 2016 at 5:49 pm toonpaddymal responded with... #

    What’s more, the WTO was founded in 1995 so British membership hasn’t been mothballed since 1973. Indeed it became a WTO member when it was a member of the EU.

  6. On August 1, 2016 at 5:55 pm toonpaddymal responded with... #

    What were they thinking? Democracy, plurality, the accountability of power, equality, liberty, landing a blow against a corrupt, inept and utterly self serving Euro political class, those kind of things.

  7. On August 1, 2016 at 7:08 pm Brom Tonaut responded with... #

    Keep whistling to yourself toonpaddymal, it’ll keep up your spirits as the merde hits the fan.

  8. On August 1, 2016 at 8:41 pm toonpaddymal responded with... #

    Hasn’t happened already? Why the delay?

  9. On August 2, 2016 at 12:46 am Agnostic responded with... #

    Thanks, true formally, but not in substance. The newly “independent” UK will have to define its specific rights and obligations under WTO – enucleating them from the EU package. It is not clear, at the moment, that this can be done without renegotiations, or synchronously with Brexit. The WTO-DG has been more than cagey on the issue.

  10. On August 2, 2016 at 12:58 am Agnostic responded with... #

    Not per se, but it is an indication of a mindset that may spread across WTO member states. And if India (or China) gets into the mood of extracting their pound of trade concessions from the now independent UK, God help it.

    India bought Raphale fighter planes from France in 2007 – they are still bickering over details, and no plane has been built or delivered yet. Amartya Sen called Indians “argumentative.” He might be right. And China has all the time in the world.

  11. On August 2, 2016 at 3:39 am toonpaddymal responded with... #

    UK could assume its current EU obligations then negotiate trade deals from there. WTO a bottomline not a fixed position.

  12. On August 2, 2016 at 3:47 am Agnostic responded with... #

    Wishful thinking. China and India may easily say that UK “stand-alone” concessions are not worth much (true – market access to a country of 64 million (if intact) and 10% of GDP in industry). They may want more – and that means delays, which UK can ill afford. Timing is everything.

  13. On August 2, 2016 at 3:48 am toonpaddymal responded with... #

    This is a complete red herring. UK unable to sell is UK unable to buy jepordizing hundreds of billions in trade. Simply the badly thought through ill will of Europhiles unable to accept the result and ready to talk down the UK’s future. Shameful.

  14. On August 2, 2016 at 3:55 am toonpaddymal responded with... #

    Nothing wishful about it. Why wouldnt they accept something they have already accepted in a different context? Why are they suddenly predatory when usual process of bi-lateral trade negotiations would serve them better at a later date? Why make an enemy of a country over something so small who youd wish to have good trading for decades to come?

  15. On August 2, 2016 at 3:57 am Agnostic responded with... #

    who cares about Little England? Also, the big Empire has to go begging for concessions from former victims of the same empire. I can hear the knives being sharpened.

    In a worldwide context, a market of 66 million is zilch, and there is supply overhang. UK has lowest productivity of G7 (but for Japan – a special case). Take British steel: the world can easily dispense with it, since there is so much over-capacity.

    But it seems, from your comments, that you have no inkling of economic strengths and weaknesses of a country that in 1940 had to undergo the “industrial audit of war” and was found wanting. It has been downhill ever since.

  16. On August 2, 2016 at 4:01 am Agnostic responded with... #

    As I have negotiated many FTAs, I can tell you from experience – it takes time, stamina, and economic assets. In a stand-alone mode UK’s assets are negligible.

  17. On August 2, 2016 at 4:01 am toonpaddymal responded with... #

    What terms would govern Chinas $64bn trade with the UK if they refused to sign off WTO?

  18. On August 2, 2016 at 4:20 am toonpaddymal responded with... #

    Spoke to Shankar Singham on this very point he regarded it as unlikely as larger commercial interests will prevail. A market of 66 million or 3% of global gdp? Or 64 billion worth of annual trade for China? All the “pound of flesh” stuff is the wish forfillment of Europhiles. In hard headed balance of interest terms the gains to China or India would be minimal. I have read Corelli Barnett indeed The Collapse of British Power is a stunning defenestration of a lazy, short sighted self -serving, priggish incompetent patricianal political clasd that I actively hope will be finally swept away by the vote on 23rd June.

  19. On August 2, 2016 at 4:27 am toonpaddymal responded with... #

    Fails to account for the fact that all other country outside the EU make their own trade deals and that no other countries anywhere are looking to form unions and replicate the EU approach. Why do you think that is?

  20. On August 2, 2016 at 5:22 am toonpaddymal responded with... #

    Spoke to Shankar Singham about the points you raised he felt strongly that commercial interests will prevail. Have read both the Audit of War and the devastating The Collapse of British Power. It should be fervantly hoped that the 23rd June marks the end of the self serving lazy feeble willed shortsighted and priggish patricianal establishment that has done so much to destroy Britains capacity to govern though I suspect it will fight a rearguard action throughout the negotiating process talking down the country that has so magnificently rejected its feeble guidance and giving open or tacit encouragement to anybody who wishes to throw a blow at Britain.

  21. On August 2, 2016 at 5:41 am Agnostic responded with... #

    So, now you have it against two elite classes: Brussels and those who thought one learned to rule the world on the fields of Eton. Good luck to be rid of both. Indeed, it all reminds me of 1649: but without Cromwell.

    US President John Adams once said: “Great Britain will be our friend what we will be its master.” The time has come. Looking for friends, Little England will find too many countries ready to run for their on interests.

    If I were India, I’d trade an agreement for the UN Permanent Seat of the UK. Why should a country who can afford its own nuclear deterrent have the seat against a nuclear country of over one billion? (France can hang on to it as stand-in for the EU).

    Good that you read Corelli Barnett. The lesson was that the UK never did learn to rationalize its industry (the failure after WWII is due to Labor). The culture of amateurism (Michael Gove: Who needs experts?) is so deeply ingrained, only by competing with the internal market was there a chance. Now you are rid of experts.

    I wish you good luck – reality is a hard task master.

  22. On August 2, 2016 at 5:45 am Agnostic responded with... #

    Ask the Chinese. They still have a grudge on account of opium. And they are full members of WTO now – they can make you pay through the nose.

    You are, however, under the misapprehension that all trade between UK and China originates and ends in either country. In fact, a good part of the trade is then rerouted into the Internal Market (e.g. think of Aerospace). So, before quoting gross figures, check the supply chains.

  23. On August 2, 2016 at 5:55 am Agnostic responded with... #

    Sure, but it takes TIME and expertise. The UK has not negotiated an FTA in 50 years. Can’t be improvised, not even by an amateur like Gove.

    Actually, the Qin Empire was a precursor of the EU, if you look at historical precedent. Emperor Qin was a rabid standardizer. China, in different forms, has survived.

    The US moved toward an EU-type solution, though the process was long flawed by the 3/5 rule (it still is).

  24. On August 2, 2016 at 6:22 am toonpaddymal responded with... #

    Trade with India is 8bn exports to 10bn imports. Big enough to leverage seat on the Security Council? Remind me again what FTA you brokered?

  25. On August 2, 2016 at 6:35 am Agnostic responded with... #

    Nuisance value in WTO framework is worth a lot. Don’t forget:
    In WTO, “Nothing is agreed until everything is agreed.” If India can block the WTO deal, that’s vital to LE.

    A bilateral deal, of course, is peanuts.

  26. On August 2, 2016 at 7:19 am toonpaddymal responded with... #

    In the event of a WTO veto the UK could draft its WTO terms into a separate agreement for the 160 countries willing to agree to those terms which would become operable under WTO if the veto was withdrawn at a later date. Your suggestion that the Chinese will jeopardise 36bn in trade for, what was their actual demand?, is a fantasy which is flatly refuted by the iron law of trade negotiations that commercial interests prevail. Talk of Opium Wars is just silly nonsense perpetuated in the risible belief that the Chinese are somehow as indignantly against the British as you are about Brexit. The long withdrawing whine of a generation raised in the Imperial tradition but who never got to govern in its manner and saw in the EU a proxy which has now be removed, is of no matter in the real world and its vindictive fictions merely squalid.

  27. On August 2, 2016 at 7:33 am toonpaddymal responded with... #

    US moved to an EU-type solution with which other countries? Pure nonsense.

    FTA’s can be struck at a later date. First stage is to regain independence. Quickest way to do this is to redraft present arrangements with the EU into bilateral agreements with the same parties. Then negotiate more bespoke deals at a later stage. Agree that expertise is in short supply in the civil service due to EU involvement however Singham has said that most global trade deals have stalled so trade experts twiddling their thumbs and available for hire.