Vulcan Insight

EU Chiefs sign off on Brexit deal, but what’s next?

24 January 2020

The House of Common passed legislation implementing the withdrawal deal on Wednesday, with Prime Minister Johnson saying that the UK had ‘crossed the Brexit finish line’. The House of Commons rejected all five amendments to the Withdrawal Bill proposed by the House of Lords, with the government winning by large majorities. In one of its first significant acts of business since returning earlier this month, Northern Ireland’s Assembly voted overwhelmingly to reject the British government’s Brexit withdrawal deal on Monday. However, the decision will not affect the UK’s departure from the EU at the end of the month, with the Scottish and Welsh Parliaments also voting against the deal. The UK’s Brexit Secretary said that while the British government would not normally press ahead with legislation without the consent of devolved administrations, the circumstances of the UK’s departure from the EU are ‘specific, singular and exceptional’. Following Westminster’s decision, Queen Elizabeth gave royal assent to the Brexit legislation on Thursday.

The Presidents of the European Commission and European Council then signed off on Britain’s EU divorce agreement on Friday morning. Ursula von der Leyen and Charles Michel signed their signatures to the document, while EU Chief Negotiator Michel Barnier looked on. The text is now due to go to the European Parliament on 29 January for ratification, after which diplomats from member states will approve the bill in writing, ensuring Britain’s orderly departure from the EU at midnight on 31 January.

The UK will then enter a transition period from 1 February during which trade talks will take place with EU. While Downing Street have said they would be happy to start the negotiations from the first day in February, the EU must wait until 24 February to agree the negotiating mandate. The European Commission must first adopt a comprehensive draft negotiating directive on 3 February, which will give an indication as to their negotiation approach. It is reported that Michel Barnier has been consulting member states to ensure that the guidelines published will be very close to the final negotiating mandate. It will then be for the General Affairs Council to adopt this mandate, after which formal negotiations with the UK can begin. Michel Barnier as head of the Task Force for Relations with the United Kingdom (UKTF) will co-ordinate the Commission’s work in relation to negotiations on the future relationship.

Both sides agree that a deal can be made by the end of the year. However, Brussels insist that any agreement made in such a short timeframe is likely to be very limited. The agreed political declaration includes some key dates for trade negotiations, with a decision on financial services equivalence due to the made by the end of June and agreement on access to fishing waters by July 2020. Speaking at the World Economic Forum in Davos this week, Trade Commissioner Phil Hogan said that the EU have to prioritise what can be achieved by early November in order to get approval by 31 December. Commissioner Hogan said that the more short-term deadlines that are imposed on the process, the less comprehensive the agreement will be. This could result in both Brussels and London scaling back their ambitions to focus on sectors where the cliff-edge at the end of the year would be the most damaging. While the Prime Minister hopes to sign a comprehensive Trade Agreement by the of year, last week he admitted for the first time that there is a slim chance that Britain will not conclude a trade deal with the EU before his self-imposed deadline of 31December 2020.