Revised Brexit Withdrawal Agreement: Analysis 1 Overview

Analysis of the revised Brexit withdrawal agreement - October 2019

Professor Steve Peers, University of Essex

Introduction

While the approval of the Brexit withdrawal agreement is uncertain at present, the UK Parliament’s upcoming vote necessitates an updated analysis of the revised agreement. This updated version includes a revised Protocol on the Irish border and a revised political declaration on the future relationship.

This post aims to provide a simplified explanation of the agreement for non-lawyers, outlining its structure and key content. For a comprehensive analysis of specific aspects, please refer to the linked blog posts on the transition period, dispute settlement, citizens’ rights, and the political declaration.

Let’s address a crucial question in light of the upcoming vote:

Key question: What happens if the withdrawal agreement isn’t ratified?

If Parliament rejects the withdrawal agreement and a no-deal Brexit this week, the Benn Act mandates the Prime Minister to request a three-month extension of EU membership. However, the EU may refuse this extension, leading to a no-deal Brexit on October 31st unless the UK revokes its withdrawal notification. Alternatively, Parliament might approve the withdrawal agreement but lack sufficient time or vote against its enacting bill. This scenario could trigger another extension request, failing which, a no-deal Brexit looms on October 31st, barring a revocation of the withdrawal notification. Notably, a proposed amendment aims to trigger the Benn Act to allow more deliberation time.

The EU Commission and the UK government have issued preparedness notices outlining the implications of a no-deal Brexit. The EU has also adopted legislation to mitigate disruptions, including visa waivers for short-term visits by UK citizens. However, longer stays would fall under stricter national laws.

It’s crucial to understand the implications of the upcoming vote:

Key question: Does the withdrawal agreement encompass the long-term UK-EU relationship post-Brexit?

Apart from Northern Ireland-related provisions, the withdrawal agreement only governs the UK’s EU exit, not the long-term relationship. A revised political declaration outlining this future relationship forms the basis for post-Brexit negotiations. Extending the transition period beyond 2020 will also be considered. Therefore, Brexit discussions will persist even with the revised agreement’s approval.

Structure of the withdrawal agreement

The withdrawal agreement is structured as follows:

  • Part One: Common Provisions (Articles 1-8) outlines fundamental aspects like definitions and territorial scope.
  • Part Two: Citizens’ rights (Articles 9-39) addresses the rights of EU27 citizens in the UK and UK citizens in the EU27 before the transition period ends.
  • Part Three: Separation provisions (Articles 40-125) details the phasing out of EU law application in the UK at the transition period’s end.
  • Part Four: Transition period (Articles 126-132) outlines the period after Brexit day during which substantive EU law continues to apply in the UK.
  • Part Five: Financial settlement (Articles 133-157) covers the financial obligations of the UK.
  • Part Six: Institutional and Final Provisions (Articles 158-185) includes rules on CJEU jurisdiction, dispute resolution, implementation decisions, and entry into force.

Three Protocols, holding equal legal weight to the main treaty, address:

  • Irish border issues
  • UK bases in Cyprus
  • Gibraltar

Part One: Common Provisions

This part clarifies that the withdrawal agreement holds the same legal force in the UK as EU law does in EU Member States. This includes the principles of direct effect (enforceable in national courts) and supremacy (national law contradicting the agreement is disregarded). It mandates the UK to pass an Act of Parliament enacting the agreement. All references to EU law are interpreted according to standard EU law rules. CJEU case law delivered before the transition period’s end is used for interpreting EU law references, while case law after this period requires “due regard” from UK courts and authorities.

Part Two: Citizens’ rights

Primarily applicable after the transition period when free movement ceases, this part ensures that EU27 citizens in the UK and UK citizens in the EU27 before the period’s end retain similar rights as pre-Brexit arrivals. Both sides must continue applying EU free movement legislation, including social security coordination and qualification recognition.

However, changes include potential residency proof requirements and the limited application of favorable family reunion rules based on pre-transition period conditions. National expulsion rules, potentially stricter than EU rules, will apply for criminal offenses committed post-transition.

The CJEU holds jurisdiction for eight years post-transition to rule on the application of these rules to EU27 citizens in the UK, based on UK court requests. An independent monitoring body in the UK can bring legal action on their behalf.

Key question: Does the withdrawal agreement terminate free movement of people?

Yes, free movement between the UK and EU ends with the transition period unless a separate treaty extends it. The Northern Ireland protocol doesn’t include free movement, only the continuation of the UK/Ireland common travel area, which is more limited. Free movement between EU Member States for UK citizens already residing in the EU27 also ends, unless addressed in a separate treaty. However, these UK citizens might qualify for a “long-term resident of the EU” status with restricted movement rights.

Part Three: Separation provisions

This part clarifies the cessation of EU law application in the UK at the transition period’s end, addressing areas like geographical indications and pending CJEU cases.

Key question: Is the UK perpetually bound by EU law on geographical indications?

No, but it guarantees continued protection for products protected at the transition period’s end.

The agreement outlines rules for ending the application of EU law concerning thirteen areas, including goods on the market, customs procedures, intellectual property, law enforcement, civil litigation, and Euratom.

Key question: Does the CJEU have indefinite jurisdiction in the UK?

No. Article 89 clarifies that CJEU jurisdiction only covers cases referred by UK courts before the transition period’s end.

Post-transition, UK courts can only refer cases in limited contexts, such as EU27 citizens’ rights for eight years or issues related to the Northern Ireland and Cyprus protocols. The CJEU can also interpret EU law in disputes over the withdrawal agreement referred to arbitration.

The Commission can sue the UK in the CJEU for four years post-transition for incorrect EU law implementation during membership or the transition period. It can also enforce specific State aid and competition decisions.

The future relationship might entail continued EU-UK cooperation, potentially rendering some separation clauses partially or entirely ineffective.

Part Four: transition period

This short part has the most significant effect: maintaining most EU law in the UK until at least the end of 2020, with a possible extension.

Key aspects include:

  • Application of EU law, including new legislation, to the UK, excluding opt-out areas like the single currency.
  • Special rules on external relations, with the EU notifying other countries that the UK remains covered by EU trade agreements.
  • No changes to fisheries catch allocations favoring either side.
  • UK exclusion from EU institutions and bodies, including the CJEU.
  • Limited UK consultation on new EU measures.
  • UK’s right to refuse applying new EU foreign and defence policy measures based on fundamental objections.

Key question: Which EU laws are covered by the transition period?

The transition period encompasses all laws applicable to the UK, except for a few exclusions relating to the European citizens’ initiative, voting rights, and standing for office in European Parliament and local elections.

Key question: Can the UK be compelled to remain indefinitely in the transition period?

No. Any extension requires joint agreement and is limited to a maximum of two years. While the Northern Ireland protocol’s rules might theoretically apply indefinitely, they are limited in scope compared to the transition period.

Part Five: financial settlement

This part reiterates the UK’s participation in EU spending until the budget cycle ends (end of 2020), aligning with the transition period’s end unless extended. It includes payments related to the reste à liquider system (commitments made in one year, paid in later years) and contributions to ‘off-budget’ EU spending until current programs expire.

Key question: Has the UK agreed to pay £39 billion in exchange for nothing?

No. This amount represents the UK’s pre-existing financial obligations as an EU member, some of which have already been paid. Furthermore, this sum partially covers the UK’s continued access to EU markets during the transition period.

Part Six: Institutional and Final Provisions

This part covers several key points:

  • The CJEU’s jurisdiction for eight years post-transition to rule on EU27 citizens’ rights in the UK.
  • The CJEU’s jurisdiction over EU law aspects of the financial settlement.
  • The establishment of a Joint Committee to oversee and implement the agreement.
  • Dispute resolution through a panel of arbitrators, with the CJEU’s involvement for EU law interpretations.
  • CJEU jurisdiction over specific aspects of the Northern Ireland and Cyprus Protocols.

Key question: Does the CJEU hold jurisdiction over the entire agreement?

No. Its jurisdiction is limited to specific areas outlined previously, including the transition period, EU27 citizens’ rights, financial settlement, and parts of the Northern Ireland and Cyprus Protocols. Arbitrators can only refer EU law disputes to the CJEU, not the entire agreement.

Finally, the agreement outlines standard provisions regarding protocols, annexes, languages, depositary, entry into force date, and a commitment to negotiate the future relationship based on the joint declaration.

Protocol on Irish border issues

The key changes in the revised Protocol compared to its previous version are:

  • Removal of the UK-wide customs union backstop and its associated “level playing field” rules.
  • Introduction of new Article 4, stating Northern Ireland is part of the UK’s customs territory for international trade.
  • New Article 5 regulating trade between Great Britain and Northern Ireland, with no customs duties unless goods might be sold in the EU.
  • Retention of provisions on the UK internal market and specific EU laws applicable in Northern Ireland, including product regulation, VAT, the electricity market, and state aid.
  • Removal of the Annex on agriculture and the environment.
  • Amendment of VAT provisions clarifying that the UK retains revenue, can reduce VAT rates for Northern Ireland, and granting the Joint Committee powers to amend these rules.
  • Retention of institutional provisions, including the CJEU’s competence regarding Protocol provisions specific to Northern Ireland.
  • New provision on “consent,” allowing the Northern Ireland Assembly to potentially terminate the customs and economic provisions under specific conditions.

Key question: Does the common travel area imply continued free movement of people between the UK and EU?

No. The absence of border checks doesn’t automatically grant residency or work rights for EU27 citizens entering the UK via Ireland.

Protocol on UK bases in Cyprus

This Protocol ensures the continued application of EU customs rules, goods regulations, and tax laws within the UK bases in Cyprus post-Brexit. It also outlines provisions for staff exemptions, border checks, fraud prevention, and the CJEU’s competence regarding relevant EU law.

Protocol on Gibraltar

This Protocol focuses on maintaining the status quo regarding worker’s rights, aviation access, and cooperation on tax, fraud, environmental protection, fishing, and police cooperation between Gibraltar and Spain post-Brexit.

Assessment

The revised withdrawal agreement’s primary focus is shifting from a potentially temporary UK-wide customs union and “level playing field” to permanent provisions focused solely on Northern Ireland. This change seeks to limit the UK’s ongoing relationship with the EU while retaining and strengthening the relationship between Northern Ireland and the EU.

The removal of the UK-wide backstop creates a “no-deal” cliff edge for UK-EU trade at the transition period’s end. This absence of a safety net for trade in goods and “level playing field” rules might lead to a repeat of “no-deal” concerns in the future.

The increased UK-EU divergence resulting from this revised agreement could lead to a significant reduction in reciprocal market access and a greater possibility of UK deregulation in areas like tax, labor, and environmental standards.

The approval of this revised agreement signifies a victory for hard Brexit supporters, while soft Brexit proponents and those in favor of remaining in the EU have suffered a setback in achieving their desired outcomes.

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