Today’s the day. Or it would have been, had the government decided to seek an extension to the Brexit transition period. Which it hasn’t.
Having left the EU on 31 January 2020, the UK entered the transition period provided for by the divorce text, the Withdrawal Agreement (WA).
This period is due to expire on 31 December 2020, and during transition, the UK is bound by EU rules in broadly the same way as it was before it left the EU. The intention was to give the UK and EU time to negotiate a trade deal and put in place the necessary measures to implement the new arrangements.
Eleven months was already considered tight for a complex deal to be negotiated, ratified and implemented. And that didn’t account for the Covid-19 crisis which has absorbed almost all the time and energy of governments across the EU.
This has led to a number of calls for the transition period to be extended. Article 132 of the WA allows for this: the Joint (UK/EU) Committee may, before 1 July 2020, adopt ‘a single decision extending the transition period for up to one or two years’.
However, the Conservative manifesto made clear that Boris Johnson would not be asking for an extension, a commitment enshrined in law by the EU (Withdrawal Agreement) Act 2020.
So is that the end of the story? What if the effects of the coronavirus outbreak are felt for longer than anticipated and the negotiations are not progressing, companies are not ready and insufficient customs agents have been appointed or trained.
One possibility is that the UK leaves the EU without a trade deal and trades on WTO terms – but even that would require time for companies to adapt. However, many people think a no-trade deal Brexit would not be good for the UK economy.
So what happens if the UK decides it wants an extension in October or November, to buy enough time to get any trade deal through all of the national and regional parliaments in the EU, and/or to give business time to prepare for the changes. This really is unknown territory.
However, the following possibilities have been suggested:
- Try using Article 50. It has been argued that, under international law, extending the transition would constitute an amendment to an existing agreement so Article 50 could still be used as a legal basis. However, many EU lawyers argue that Article 50 was turned off, for the UK, on Brexit day, 31 January 2020.
- As a variation to the above, the EU/heads of state and government and the UK could enter into an international agreement outside EU law to agree to an extension. However, this seems difficult legally because an extension of the transition would extend EU law and so the EU would need a ‘legal basis’ (that is, a provision in the EU Treaties) to act – which takes us back to the problem in (1). There are a number of other legal bases in the Treaty, such as Articles 207 (allowing for agreements to be concluded with third countries, such as the UK, on trade issues) and 217 (allowing for association agreements to be concluded with third countries), but these might well require unanimous agreement between member states in the EU Council. Moreover, if the agreement touches areas of member state powers, it will be a so-called ‘mixed agreement’, and this means national (and some regional) parliaments must also give their approval. The ECJ may also be required to give its opinion under Article 218(11) TFEU. At best, this will be highly time consuming.
- Reach an agreement with the EU by 31 December 2020 which envisages a fairly lengthy implementation period to turn off existing rules of EU law and to enter into the new arrangements, conceivably over a number of years. However, this will need a legal basis in the Treaty and is likely to be a mixed agreement which, again, would need ratification by all member states. This would have to be done by December 2020.
- A decision of the Joint Committee to agree to a new extension. While the Joint Committee can amend the Withdrawal Agreement, its powers do not include amending Article 132 (the provision on agreeing an extension to transition by 1 July 2020).
- Using Article 352 TFEU, as a legal basis to ‘attain one of the objectives of the Treaty’. However, these objectives (set out in Article 3 TEU) do not include withdrawing from the EU. Moreover, Article 352 can be used only where no provision in the treaty provides for action to attain the ´objective` (and Article 50 does that). Finally, Declarations 41 and 42 in the same EU Treaty make clear that Article 352 cannot be used to widen the scope of Union powers, which its deployment in this case would imply.
- Hope the EU unilaterally concedes, as the UK has done, to not applying full border controls for six months. So far, the EU has said no.
All of this pointed to a need for a decision to be taken on extension by 1 July 2020, as various business groups have called for. This ain’t going to happen. That being said, never rule out the ingenuity of EU lawyers if forced to come up with some imaginative solution on getting round the problem come the autumn.
By Professor Catherine Barnard, senior fellow at The UK in a Changing Europe.