As we mentioned in our previous reports (here and here), “sufficient progress” in the first phase of the Brexit negotiation could not be achieved before the European Council of October 19-20, 2017 – so the heads of government decided to wait until their next meeting, on December 14-15, to assess whether the second phase, dealing with the future relationship, could be launched.
By the end of November, the UK government made progress on the sensitive issue of the financial settlement, but it took a frantic week of high political drama to finally reach the “sufficient” agreement, just in time (see our post here on her abortive lunch with President Juncker, and the agreement that was reached following objections from Northern Ireland). British Prime Minister Theresa May was warmly applauded by her 27 EU colleagues when the decision to launch the second phase was made by the European Council on December 14.
The second phase will start formally in February 2018 with a discussion on the “transition period” between the day of withdrawal and the entering into force of the new treaty. To that end, the European Council adopted guidelines in December (here), and on January 29, the Council of Ministers agreed a new mandate for the Commission negotiator Michel Barnier (here).
The discussion on the future relationship itself will only start later in spring. The talks will initially concentrate on a political declaration on the framework of this future relationship, which will be attached to the withdrawal treaty.
The Second Phase of the Brexit Negotiations
As is now well-known, the logic for the two-phase approach in the Brexit negotiation stems from Article 50 of the EU treaty. The withdrawal treaty is a specific instrument which should be agreed upon by qualified majority within 2 years after the procedure has started under Article 50. However, it must take account of the future trade relationship between the remaining EU Member States and the country leaving the EU. The negotiation on the future relationship, however, will take more time, and will be conducted based on the model of trade negotiations between the EU and third countries, which at the end of the process requires the agreement of all EU Member States, ratified by national parliaments.
The EU therefore split the negotiation of these issues in the separation that posed the greatest political difficulty off into the first phase, with negotiations on the framework for the future trade relationship only beginning in phase two. The end of the first phase, however, does not mean that the negotiation over the past is over. Numerous technical issues still need to be addressed and the December joint report (see here) will need to be translated into a legal instrument that will form the basis of the
Continue Reading Brexit Negotiations, Phase 2: Transition, Trade, and Trouble Ahead