31.Article 50(2) TEU requires that the withdrawal agreement “take[s] account of the framework” of the withdrawing Member State’s “future relationship with the Union”. Sir David said that the German language version of Article 50 made plain that the “structure of future relations will already have been established at the point when withdrawal takes place.” Professor Wyatt agreed. He did not think that the withdrawal agreement would be able to “accommodate all the details of the future trading relationship”, and so both agreements would be negotiated in parallel. He emphasised that: “Co-ordination between the withdrawal treaty on the one hand and the future relations treaty on the other would be important. The UK’s aim would be to have a smooth transition between the past in the EU and the future in the new arrangement.”
32.Both witnesses agreed there would be a third negotiation: the remaining Member States would have to amend the EU Treaties to take account of the withdrawal of the Member State concerned. This would be a “housekeeping arrangement”, however, and would not involve the withdrawing Member State.
33.Article 50 does not set out the procedure for the negotiations on the future relationship. Nonetheless, in Professor Wyatt’s view:
“The essential bones of the negotiation would be the same. The Council would lay down a negotiating mandate to the Commission, which would get on with the job. Whatever the Treaty base, there would be a special committee working alongside. There would also be toing and froing between the European Parliament and the Commission.”
34.He thought the agreement on a future relationship would also be mixed, and so its conclusion in the Council would require consensus among the Member States. If it were an association agreement, that too would have to be concluded by unanimity in the Council.
35.Professor Wyatt thought that the influence of the Member States would be considerable, as with the withdrawal negotiations:
“There would be deep involvement from the national Governments via the Council and the committee. Although the Commission would be negotiating and there would be input from the European Parliament … it seems to me that the influence of the national Governments on the EU side would be enormous.”
36.Sir David thought that the degree to which Member States would be involved would depend on what was being negotiated. Spain, Portugal, the Netherlands, Belgium and Denmark would have “enormous interest” in an agreement on fisheries, for example; but many other Member States would not. According to Professor Wyatt, this would allow Member States to seek trade-offs between different areas of the negotiations:
“If I am a hypothetical east European country, with a very obvious and genuine interest in both the position of my nationals resident in the United Kingdom and the future access of the UK, I might not be interested in fisheries as such but I might want to block a deal on fisheries unless I get what I want on transition and future access for my nationals.”
37.Neither witness could be certain about the form the UK’s future relationship with the EU would take. Professor Wyatt told us: “My suspicion is that it would actually be an association agreement of some kind, because we would end up with a fairly complex comprehensive agreement that would involve co-operative machinery of some sort.” The agreement would be likely to include a comprehensive trade deal that would cover not only goods but banking services and insurance services.
38.It is likely that an agreement on the UK’s future relationship with the EU would be negotiated in tandem with the withdrawal agreement. It would be in the interests of all parties to coordinate the negotiations closely.
39.The Member States would retain significant control over the negotiations on a future relationship. We note the potential for groups of Member States vetoing certain elements of the agreement to secure better deals on others. This could mean, in effect, that nothing would be agreed until everything was agreed.
41 (Prof Derrick Wyatt)
42 (Prof Derrick Wyatt)
45 An association agreement with the EU is a comprehensive agreement (rather than limited to one area of policy) involving reciprocal rights and obligations. See further at para 37 of this report.
46 ; Article 218(8)