Brexit Breakdown

Ioanna Hadjiyianni and Amanda Spalding, PhD Candidates, Dickson Poon School of Law, King’s College London

On the 23th of June 2016 the UK public voted to leave the European Union. Neither Whitehall nor the Leave campaign appear to have been prepared for such a result and the many legal and political issues it raises. In this post we will attempt to give an overview of some of the most significant legal questions raised by Brexit and how they might be resolved.

  1. What happens now?

The current state of affairs is that the New Settlement for the United Kingdom within the European Union negotiated by Cameron and reached at the European Council in February 2016 will not apply and no longer exists.[1] The overwhelming question now is whether the result of the EU referendum has legally binding effect and would thus trigger the withdrawal procedure under EU law. The only acceptable procedure for withdrawal from the EU is provided for in Article 50 of the Treaty on the European Union (TEU) as the UK cannot unilaterally withdraw by suspending the European Communities Act 1972 consistently with international law and EU law requirements.[2] 

  • Triggering the Article 50 procedure

Article 50 TEU stipulates that ‘any Member State may decide to withdraw from the Union in accordance with its own constitutional requirements.’ It is clear from the wording of Article 50 TEU that whether a Member State decides to withdraw is a decision left to its discretion – a unilateral decision that cannot be imposed by either EU institutions or any other Member State. Any legally binding effect and consequences stemming from Article 50 come into play once the procedure is actually triggered. Once the Member State decides to withdraw then it is under an obligation to inform the European Council of its decision and follow specific procedures of negotiations.[3] Politically however, the story is quite different. As the EU representatives have made clear following the result of the referendum, ‘we now expect the United Kingdom government to give effect to this decision of the British people as soon as possible, however painful that process may be. Any delay would unnecessarily prolong uncertainty.’[4] Any unnecessary delays of uncertainty will not be tolerated by the rest of the EU and the UK will have to make a decision sooner rather than later. This thus bring us to whether and how the UK may trigger Article 50 and the question of its own constitutional arrangements for deciding on withdrawal.

Under UK constitutional law, the UK operates in a Parliamentary democracy governed by the principle of parliamentary sovereignty. Legally speaking thus a referendum is usually of advisory nature and ‘does not affect the authority of Parliament’.[5] Direct democracy by way of referendum is not very usual in the UK and does not have legally binding nature. Instead, referendums are usually organised on ad hoc basis based on specific rules governing each instance. Even when referendums are required by legislation as is the case with the EU Act 2011, which requires a referendum to be held in cases where amendments to the EU treaties are made, changes to EU treaties have to be approved both by referendum and by an act of Parliament. In relation to the EU referendum, the European Union Referendum (Conduct) Regulations 2016 do not provide for legally binding effect. What this means is that the decision required under Article 50 TEU for the procedure of withdrawal to be triggered would ordinarily have to stem from a Parliamentary vote on a bill to enable exit from the EU in line with its own constitutional arrangements.[6] On the basis of UK constitutional law, it seems that there is a requirement and very good reasons for the UK Parliament to be involved in whether and when the Article 50 process is triggered,[7] especially as the UK Parliament would have to also approve the end result of this negotiating process.

However, the political reality is more complex in practice as it would be very difficult to legitimise a decision of the UK government or Parliament to simply ignore the voice of 17.4 million people who technically ‘won’ in favour of leaving the EU. The significant democratic weight of the referendum result can be seen from the EU statement which stressed that ‘in a free and democratic process, the British people have expressed their wish to leave the European Union’[8] and the government is thus expected to give effect to that decision and this expectation is felt even more strongly by leave supporters.

Nonetheless, at the moment there doesn’t seem to be a majority in Parliament supporting the leave result and thus legally the referendum may become redundant if a vote in Parliament takes place. An alternative and indirect way for not giving effect to the referendum result or for potentially triggering a second referendum could take place by triggering early general elections.[9] In this case, a government whose campaign is based on remaining in the EU would be legitimately expected to give effect to such promises and thus decide to remain in the EU or hold another referendum then.

  • If Article 50 TEU is triggered – What happens in the meantime?

If Article 50 TEU is triggered, by the UK informing the EU Council of its decision to leave the EU then negotiations will start on future arrangements on the relationship between the EU and the UK. These can last up to two years unless all Member States approve an extension of this period.[10] During this period the UK is not allowed to participate in decision-making procedures on the withdrawal agreement,[11] while in principle the UK will still have a voice on all other matters in EU law. In reality however the UK’s voice will be diminished as a future ex-Member which will be gradually seen as a third country that will most likely not have a voice in future decision-making. The far-reaching implications for UK involvement in EU decision-making in the meantime can be seen for example through the resignation of MEP Ian Duncan from the dossier on the revision of the EU ETS, realising the difficult position for promoting a measure that might not ultimately bind his country.

In the meantime, the UK will still remain a Member State and thus be bound by existing and new EU law rights and obligations until the withdrawal agreement enters into force. UK citizens and companies in other EU countries will thus benefit from free movement rights as will EU citizens and companies established in the UK. Similarly, the judgments of the CJEU will still be binding on the UK. The only option for the UK to not have to comply with EU law during that transitional period would be through a unilateral repeal of the European Communities Act 1972. However, this would be contrary to international law commitments and would create a lacuna in the law and considerable uncertainty as to the legal and institutional framework of the UK in many policy areas. It is unlikely for such a decision to be made. It would be beneficial for both the UK and the EU for a mutual agreement to be reached on their relationship instead.

It should be noted that once the UK enters into the negotiating period under Article 50 TEU, EU law will cease to apply to the UK if an agreement is not reached within two years, in the absence of a unanimous vote for extension of that period. In that case the UK would have to fall onto existing international arrangements outside of the EU regime, for example under the WTO, in its relations with EU Member States.

  1. Possible Arrangements with the EU

Once the Article 50 TEU process is triggered, then the question becomes what kind of agreement the UK could conclude with the EU in light of the UK wishing to have access to the EU single market. Some of the possibilities of how the future relationship of the UK and the EU might look like are outlined below.

European Free Trade Association (EFTA): This was founded in the 1960’s and aims to increase free trade with both the EU and third countries. The UK was a founding member of this association but left to join EU in the 1970’s.   Although the current members are Switzerland, Norway, Liechtenstein and Iceland, only Switzerland does not participate in the European Economic Area which is managed by EFTA and largely defines the relationship with the EU. Without EEA membership, EFTA is very much an ‘empty shell’.[12] The relationship between Switzerland and the EU is governed by various bilateral agreements but the EU does not seem particularly happy with this way of doing business and in 2014 began negotiations to change it.[13] Thus it is incredibly unlikely that bilateral agreements with EFTA membership would be a viable option for the UK.

European Economic Area (EEA): Norway, Iceland and Lichtenstein participate in the internal market through the EEA. This means they adopt all the relevant EU law without the ability to participate in the decision-making process. However, these states do benefit from the fact that EU legislation does not become automatically applicable within their national legal orders, although this merely means delays in adoption as refusing to adopt relevant EU law could result in suspension of the state from the EEA. The EEA is more focused on the internal market and therefore does not cover Common Agriculture and Fisheries Policies (though there are some rules on trade in agricultural and fish products), Customs Union, Common Trade Policy, Common Foreign and Security Policy, Justice and Home Affairs and the Monetary Union. However, because it is internal market focused it does include the Free Movement of People. Given that this has been cited as the driving force behind the decision to leave, it seems unlikely that this type of deal will be agreeable to UK politicians.[14] At the same time the EU Member States have made it clear that ‘access to the Single Market requires acceptance of all four freedoms’,[15] including free movement of persons.

Free Trade Area (FTA) Agreement: The UK makes a separate FTA deal with the EU. This would almost certainly involve complying with many EU regulations such as product standards, health and safety rules, consumer protection etc. This would also mean concluding separate FTAs with other countries as the UK would no longer benefit from the trade agreements between the EU and third countries. The UK would likely be in a weakened bargaining position and would be unlikely to obtain such favourable terms as the EU’s current deals with third countries. Also the benefits of this type of deal depend on the content of whatever agreement is reached. Both the EU itself and the leaders of EU Member States will likely want to use Brexit as a cautionary tale to dissuade others from leaving. For example, the Dutch Prime Minister has said to anyone thinking it was “a good idea to leave the single market, this is what happens”[16] referring to the economic and political chaos caused by the Brexit vote. Thus they may not be willing to give the UK a very favourable deal.

  1. Citizenship Rights – Acquired Rights?

Another important and hugely debated issue at the moment is how citizenship rights acquired by UK nationals in other EU countries and by EU nationals in the UK could be protected even after exit from the EU. Generally, citizenship rights are dependent on the arrangements agreed on free movement of persons as the continuity of existing rights would be relatively straightforward if free movement of persons is included in the withdrawal agreement.[17]

The matter of citizenship rights is more complicated in case no agreement is concluded or an agreement is concluded which includes restrictions on the arrangements on free movement of persons. As a matter of principle, EU citizenship rights are unlikely to simply continue applying to UK nationals. EU citizenship directly derives from citizenship of an EU member state.[18]  Once the UK is no longer a Member State, UK nationals would lose their EU citizenship. Amendment of the Citizenship Directive or the Treaty on this point is unlikely. Continuation of citizenship rights as they currently stand could even lead to absurd consequences.[19]

However certain citizenship rights may exist if the EU and the UK conclude an agreement like the EEA in which case the Citizenship Directive may be of relevance. Indeed, the Citizenship Directive has been deemed as EEA-relevant, especially because it incorporates many provisions on free movement of workers. However, due to lack of equivalent provisions on citizenship in the EEA Agreement, there are limits as to the extent of citizenship rights extended through CJEU case law such as the access to benefits for job-seekers or in wholly internal situations.[20]

In any event, even in the unlikely scenario that the UK does not conclude any kind of agreement with the EU, UK nationals would be considered as foreign nationals and could have rights if they are family members to an EU national who has exercised his/her free movement rights. However, any free movement rights deriving from that would be dependent on the EU national family member’s rights.[21]

Outside of EU law there could be some legal basis for safeguarding citizenship rights already acquired or in the process of being acquired. This would be on the basis of the principle of ‘acquired rights’,[22] whereby vested rights do not cease to exist after termination of an international treaty. However the scope and enforceability in national courts of acquired rights is uncertain.[23] Indeed, Professor Douglas-Scott has argued that acquired EU rights would not be protected under international law after Brexit, especially since there is no explicit reference in the EU treaties providing for such effect.[24]Ideally a specific clause ensuring recognition of acquired rights would be preferable.[25]

However, since the argument of acquired rights has not been tested in EU law before, it could potentially be argued before the European Court especially if other parts of EU law apply to individuals as a result of the withdrawal agreement. Once EU law applies to third country nationals, the EU affords legal protection (including protection of fundamental rights) to such individuals.[26] If their position would be adversely affected because of revocation of rights accorded to them as a result of EU law prior to exit, general principles of law such as legal certainty, legitimate expectations and the rule of law could require the EU to recognise rights already exercised. Such an argument could be reinforced on the basis of the EU’s commitment to promote and uphold its own constitutional values abroad, including human rights and the rule of law.[27] Reversing the protection of such rights of retrospectively after the UK leaves the EU for persons that have exercised their rights under EU law could be deemed as contrary to the EU’s constitutional commitments.

In any event such rights would be more restricted and would only apply to people who have already exercised specific rights. Overall, some qualified protection of citizenship rights could be afforded to EU citizens who have already exercised or are in the process of acquiring such rights as a result of EU law, while more full protection would require specific provisions in the withdrawal agreement which would have to be based on reciprocity.

  1. Scotland and Northern Ireland

Both of these countries voted to remain and the EU referendum may well have a significant impact on them and their relationship with the UK.

Scotland voted clearly in favour of Remain with a 62% Remain Vote. This has triggered calls for another independence referendum for Scotland. In 2014, 55% of Scottish people voted in favour of remaining in the UK but a big part of the campaign to keep Scotland in the UK was based on fearmongering that Scotland would be out of the EU should it become independent. Brexit has thus left many Scottish voters feeling that the terms of the deal have changed. The Scottish National Party (SNP) is currently in power both in the Scottish Parliament and make up a significant number of MPs at the UK Westminster Parliament.  They have come out heavily in favour of another referendum and have made it clear that ‘We have no intention whatsoever of seeing Scotland taken out of Europe. That would be totally, totally democratically unacceptable…We are a European country and we will stay a European country. If that means we have to have an independence referendum to protect Scotland’s place, then so be it.’[28] The SNP are reported to also be considering ways to remain a member of the EU without independence. In the 1985 Greenland Treaty, Greenland left the EU but remained part of Denmark thus there is a precedent for redefining what parts of a country are party to the EU. This is likely to be incredibly complicated if the Scottish Parliament remains a devolved body with limited powers but is a possibility.

Northern Ireland (NI) also voted Remain with a 56% Remain vote. This has led NI’s Deputy First Minister Martin McGuinness to call for a poll on whether NI should remain part of the UK or leave and unify with the Republic of Ireland.[29] So like Scotland, NI may secede from the UK. However, a bigger concern in this context is that Brexit may trigger a return of the ‘Troubles’ in Northern Ireland: a thirty-year large scale violent conflict between Unionists and Nationalists over whether NI should remain part of the UK or join the Republic of Ireland which only officially ended in 1998. The potential for a resurgence of conflict is exacerbated by the fact that the Remain vs Leave vote was very much drawn along party lines with the Unionist parties campaigning for a Leave vote and the Nationalist parties campaigning for a Remain vote. Also, no real border currently exists between the Republic of Ireland and NI – there are no border guards, no requests for papers etc – many people live in the Republic of Ireland and work in NI and vice versa. The possibility that such a border will now be erected is likely to further inflame tensions, it would undermine NI’s close ties to Ireland and would be very reminiscent of the checkpoints which existed during the Troubles.

  1. Gibraltar?

Gibraltar voted overwhelmingly Remain with more than 95% in favour of staying in the EU. Fabian Picardo, the Chief Minister for Gibraltar is in talks with Nicola Sturgeon, the First Minister of the Scottish Parliament about staying in the EU by using the 1985 Greenland precedent outlined above. However, another concern regarding Gibraltar is whether Spain will attempt to claim sovereignty over it. The day after the referendum the Spanish Foreign Minister already began the push for joint control over the territory saying: ‘It’s a complete change of outlook that opens up new possibilities on Gibraltar not seen for a very long time. I hope the formula of co-sovereignity – to be clear, the Spanish flag on the Rock – is much closer than before’[30] In 2002 a referendum was held on the proposition of the UK sharing sovereignty over Gibraltar with Spain. This was rejected by a massive majority, with over 98% of the population voting against joint sovereignty for Spain. Thus any push for control by Spain is likely to be very unpopular with the people of Gibraltar.

Thousands of crossings between Spain and Gibraltar happen each day and like the Northern Irish situation above, Brexit could see the return of a full border between the two.  Depending on the relationship between the EU and the UK after Brexit, Spain could potentially push its advantage by closing its border and isolating Gibraltar – something it could not do in the past due to EU rules. This would make life quite difficult for many Gibraltarians and may allow Spain to push them towards accepting Spanish sovereignty.

  1. Conclusion

The decision to leave the European Union has created much uncertainty, both immediate and long-term. There is uncertainty over how and when the UK will ‘officially’ begin the Brexit process, what it’s future relationship with the EU will look like and the personal and professional futures of the many EU citizens living in the UK and the many UK citizens living in the EU. It also has the potential to begin the disintegration of the United Kingdom as various territories seek independence or unity with a different state.

Disclaimer: The views expressed here are personal to the editors and do not reflect the position of either the Dickson Poon School of Law or of King’s College London.

[1] Statement by the EU leaders and the Netherlands Presidency on the outcome of the UK referendum, http://www.consilium.europa.eu/en/press/press-releases/2016/06/24-joint-statement-uk-referendum/

[2] House of Lords, European Union Committee Report on the Process of withdrawing from the European Union, 4 May 2016,  http://www.publications.parliament.uk/pa/ld201516/ldselect/ldeucom/138/138.pdf.

[3] TEU, Article 50(2).

[4] ibid.

[5] Bradley, Ewing and Knight, Constitutional and Administrative Law 16th ed (Pearson) 73.

[6] On the basis of these constitutional arrangements the UK Parliament similarly passed the European Communities Act 1972 to enable the UK to accede to the EU.

[7] https://ukconstitutionallaw.org/2016/06/27/nick-barber-tom-hickman-and-jeff-king-pulling-the-article-50-trigger-parliaments-indispensable-role/

[8] Statement by the EU leaders (n 1).

[9] This is possible under Section 2 of the Fixed Term Parliaments Act 2011 in case of vote of no confidence.

[10] TEU, Article 50 (2) and (3).

[11] TEU, Article 50(4).

[12] Jean-Claude Piris ‘Which Options Would Be Available for the United Kingdom in the Case of a Withdrawal from the EU?’ in P.J. Birkinshaw and A Biondi Britain Alone! The Implications and Consequences of United Kingdom Exit from the EU (Kluwer Law International 2016) p.118.

[13] Council of the European Union; Negotiating mandate for an EU-Switzerland institutional framework agreement; Brussels, 6 May 2014 9525/14 file:///C:/Users/k1202852/Downloads/142503.pdf

[14] https://www.theguardian.com/world/2016/jun/28/cameron-eu-leaders-uk-control-immigration

[15] http://www.consilium.europa.eu/en/meetings/european-council/2016/06/29-27MS-informal-meeting-statement/

[16] https://www.theguardian.com/world/2016/jun/28/cameron-eu-leaders-uk-control-immigration

[17] House of Lords, European Union Committee Report (n 2).

[18] Treaty on the Functioning of the European Union (TFEU), Article 20(1) and Directive 2004/58 Article 2(1) ‘Union citizen’ means any person having the nationality of a Member State’.

[19] Jean-Claude Piris, (n 12) 128.

[20]Halvard Haukeland Fredriksen, and Christian NK Franklin, ‘Of pragmatism and principles: the EEA agreement 20 years on’ (2015) 52(3) Common Market Law Review 629.

[21] For example, Directive 2004/58 Articles 5(2), 6(2) and 7(2).

[22] Acquired rights are recognised under the Vienna Convention on the Law of Treaties (Article 70(1)(b)) and possibly as a customary principle of international law, German interests in Polish Upper Silesia, (1926), PCIJ.

[23] [23] Professor Steve Peers, ‘What next after the UK vote to leave the EU?’ EU Law Analysis blog, http://eulawanalysis.blogspot.co.uk/2016/06/what-next-after-uk-vote-to-leave-eu.html.

[24] https://ukconstitutionallaw.org/2016/05/16/sionaidh-douglas-scott-what-happens-to-acquired-rights-in-the-event-of-a-brexit/.

[25] Professor Steve Peers, ‘What next after the UK vote to leave the EU?’ EU Law Analysis blog, http://eulawanalysis.blogspot.co.uk/2016/06/what-next-after-uk-vote-to-leave-eu.html.

[26] For example in the Kadi case, Cases C-402 and 415/05 P Yassin Abdullah Kadi and Al Barakaat International Foundation v Council and Commission.

[27] TEU, Article 21.

[28] http://www.independent.co.uk/news/uk/politics/brexit-scotland-eu-referendum-result-snp-scottish-independence-what-it-means-a7106086.html

[29] http://www.independent.co.uk/news/uk/politics/brexit-northern-ireland-eu-referendum-result-latest-live-border-poll-united-martin-mcguinness-a7099276.html

[30] http://www.telegraph.co.uk/news/2016/06/24/spain-proposes-shared-sovereignty-over-gibraltar-after-brexit-vo/.

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