The Truth About the 10 Biggest Brexit Myths (of the Moment)By
It’s been seven months since the U.K. triggered the two-year countdown to Britain’s exit from the European Union, but the path to Brexit remains murkier than ever as officials contradict each other.
U.K. Prime Minister Theresa May voted to Remain but now pledges to deliver Brexit, while opposition leader Jeremy Corbyn’s views on the EU are ambivalent at best. May’s own Conservative Party is split, with one vocal faction calling for the U.K. to walk out without a deal. (Here’s what “no deal” would mean.) Meanwhile, the EU is puzzled by the British approach, with talks stalled.
As with most unprecedented events, who’s to say how it will pan out. Here’s a guide to what to believe as talks progress and—more importantly—what not to.
1. Any Brexit Deal Must Include a U.K.-EU Trade Agreement
INCORRECT. The current negotiations will only explore the outlines of the future relationship, and mainly in the context of how it will have an impact on the terms of the U.K.’s withdrawal. The agreement governing future trade links will be a completely separate agreement and legally it cannot be signed until the U.K. is no longer an EU member.
Some British lawmakers say they hope this could happen a minute after the U.K. leaves, but EU officials say this is overly optimistic. Realistically, getting it negotiated in time for the end of the possible two-year transition period is the best Britain should hope for.
2. A Transition Period Is Inevitable
INCORRECT. The EU agrees that a transition arrangement – expected to last about two years and designed to give certainty to businesses and allow more time to negotiate a trade agreement – is a good thing. But it’s conditional on the Brexit deal, including the financial settlement, getting approved. Also, at a certain point it stops becoming something worth fighting for if businesses have made up their mind and put in place their contingency plans. In short, a transition stops being valuable if not agreed soon.
3. Interim Deals Will Be Binding
INCORRECT. There’s only one Brexit agreement. It includes the bill and the other divorce issues, a potential transition arrangement and the outlines of the future relationship. Nothing is agreed until everything is agreed so if the deal doesn’t get approved by the EU and U.K. before Brexit day, Britain isn’t on the hook for anything. There may be some financial obligations that the U.K. is legally contracted to pay, but British officials say this amounts to very little.
4. All EU Countries Must Approve the Final Brexit Deal
INCORRECT. The deal—which would also include any transitional arrangement—needs to be approved by the U.K., the European Parliament and what’s called a “qualified majority” of EU governments. Under current rules, that means the deal would have to be supported by 20 of the 27 EU governments; but they can’t be the smallest 20 countries because they have to represent 65 percent of the EU-27 population.
5. The U.K. Must Pay 60 Billion Euros for Talks to Advance
INCORRECT. While the EU has signaled that it’s looking for at an overall exit payment from the U.K. of approximately 60 billion euros—(52 billion pounds or $70 billion)—it’s not demanding the U.K. agree to a final figure now. The bloc said there needed to be “sufficient progress” on phase one of the negotiations—the financial settlement, the protection of citizens’ rights and the Irish border—to move onto discussions about future relations and trade.
Instead, the EU wants the U.K. to agree to a method for calculating it. Some might argue that if you have a methodology then you can work out the number. Which brings us to the next point.
6. Nailing Down the Methodology Means We’ll Know the Final Amount
INCORRECT. The EU wants more than just vague pledges and what the EU says the U.K. owes is made up of separate chunks. These include what’s known in French as “reste a liquider” (essentially the EU’s unpaid bills for payments governments have previously agreed to), the EU’s liabilities (including pensions), contingency money and other commitments (such as foreign loans). While Prime Minister Theresa May says the U.K. will honor its payments until the end of the EU’s current seven-year budget (which would come to about 20 billion euros), the EU wants reassurance that she’s prepared to plug some of the other gaps as well.
The calculation is further complicated because there’s disagreement over what share of each chunk the U.K. should be liable for. While agreeing to a formula that satisfies the EU might imply the U.K. has agreed to an approximate sum, negotiations on the financial settlement will continue right up until Britain’s departure.
7. The U.K. Must Make a Formal Proposal on the Exit Payment
INCORRECT. EU officials have expressed frustration that May’s pledges, made in speeches and in private, haven’t been translated into formal commitments around the Brexit negotiation table. The EU produced its own position paper—essentially the methodology it wants the U.K. to agree to—back in June. The EU isn’t demanding the U.K. do the same, but it does want negotiators to make some kind of written commitment in private. That would allow Michel Barnier, the EU’s chief Brexit negotiator, to recommend to the EU’s 27 leaders that “sufficient progress” had been achieved. That raises the question of how quickly could that commitment leak? Given how the contents of private dinners can’t be kept quiet, Britain’s reluctance to commit anything to paper is perhaps well-founded.
8. There Are Chinks in the EU’s Armor to Exploit
A GRAIN OF TRUTH. Barnier and his team of technocrats can only follow what’s been set down on paper. That leaves little wiggle room. Having said that, national leaders have the final say, so British diplomatic pressure on national capitals has its merits. Some countries that trade a lot with the U.K., such as the Netherlands and Denmark, would prefer discussions on future links to start sooner rather than later.
9. Failure to Make a Breakthrough by December Means Talks Collapse
INCORRECT. The optics of gridlock going into 2018 are not pretty. Both sides gave up on achieving “sufficient progress” at a summit in October long before leaders formally announced it. A repeat of that when the 28 chiefs reconvene in December would be a serious blow to U.K. efforts to give business a lick of certainty about what sort of rules they’ll be operating under after Brexit. Chancellor Philip Hammond sees transition guarantees as a “wasting asset” and January looms as a cut-off point.
Failure here might change the political equation for both sides. Will preparations for Plan B—which some might have thought earlier in the process as a bluff—pick up in earnest? EU officials have hinted that, at a push, emergency summits could be organized for January or February, but the bloc is already preparing to reassess where the negotiations are heading if there’s no December breakthrough.
10. The EU Will Delay Brexit to Allow Parliament to Vote on the Deal
INCORRECT (Although not impossible). British lawmakers gave conflicting signals last week about when Parliament would get to vote on the deal. Brexit Secretary David Davis went as far as to say that the EU would postpone Brexit to wait for approval. This isn’t the EU’s plan and it’s very unlikely. It would need all 27 governments to give consent to prolong the U.K.’s membership past March 2019. The EU envisages the negotiations to be ready by October 2018 to give six months for the deal to be approved. The European Parliament must also vote on the deal and it won’t do so until British lawmakers have. What happens if British lawmakers are given the right to amend the deal, which will have been around 18 months in the making, remains to be seen.