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Don’t overlook the role of the European Parliament in Brexit

James Day, 29 March 2017

As the UK kicks off the Article 50 negotiations, it remains the case that relatively little attention has been paid to the role of the European Parliament, which will accept or reject the agreement between the UK and the EU setting out the arrangements for Brexit. If the European Parliament rejects the agreement, the UK may well ‘crash out’ of the EU two years after the Article 50 notification was delivered, resulting in trade between the two parties being conducted in accordance with WTO rules and many other major issues being left unaddressed. The European Parliament will therefore exert a major influence over the manner in which the UK leaves the EU.

So far, the involvement of the European Parliament has attracted attention due mainly to its appointment of the staunchly federalist Guy Verhofstadt as its representative in the Brexit negotiations, and Verhofstadt’s well-publicised call for British citizens to be allowed to maintain the rights of EU citizenship post-Brexit. However, many MEPs clearly intend to make much more far-reaching demands about the terms on which Britain will leave the EU, with a spokesman for the centre-right EPP group warning that ‘the Parliament is ready to play the bad cop’ and that it ‘will complain about almost everything.’

First and foremost among the issues likely to be raised by the European Parliament is the extent to which the UK can expect access to the single market without accepting the free movement of people in return. Verhofstadt has said that ‘we shall never accept a situation in which it is better to be outside the single market than be a member of the European Union’ and that ‘we cannot undo the four freedoms.’ Similarly, EPP leader Manfred Weber has warned that if the UK wants access to the single market ‘it has to accept all four freedoms’ and said that a free trade agreement between the EU and the UK ‘will not happen,’ hinting that the Parliament would be less concerned than the member state governments about securing EU businesses’ access to the British market after Brexit. The European Parliament also apparently intends to insist that EU citizens who moved to the UK after the Article 50 notification should have the same right to live and work in the UK as those who did so earlier.

Furthermore, according to draft versions of the resolution on Brexit being drawn up by the European Parliament, MEPs intend to insist that Britain ‘fulfill its commitment’ to the EU budget. Meanwhile, the Commission’s Brexit unit, led by Michel Barnier, is known to be preparing an extensive list of financial liabilities, including unmet spending commitments and staff costs. According to the Financial Times, this could leave Britain facing a bill of €40-60 billion. This claim has prompted widespread protests from Conservative backbenchers, suggesting that the issue of Britain’s outstanding debts to the EU might be an obstacle to the negotiation of an agreement which is acceptable to both the British and the European Parliaments.

Another potential difficulty is the issue of the jurisdiction of the European Court of Justice.  Michel Barnier has said that the Brexit agreement will have to be completed before work can begin on an EU-UK trade treaty. Verhofstadt, while echoing this opinion, has argued that the UK should remain under ECJ jurisdiction during any transitional period between the UK’s leaving the EU and an EU-UK trade agreement coming into force. Continued ECJ jurisdiction after Brexit would be difficult for the UK to accept, since it might well interfere with the efforts of British businesses to position themselves for a future outside the EU.

These highly contentious issues mean that the ratification of the Brexit agreement by the European Parliament should not be dismissed as a formality, especially given that the federalist EPP, ALDE, and S&D groups together have a large majority in the Parliament. While Theresa May has already affirmed that ‘no deal for Britain is better than a bad deal for Britain,’ the government should take steps to ensure that this is more than just bluff. The European Parliament’s demands on freedom of movement, Britain’s financial contributions, and ECJ jurisdiction mean that its support for any Brexit agreement that the government would be likely to accept cannot be taken for granted.

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