Brexit: deal or no deal Contents

Chapter 1: Introduction

The subject-matter of this report

1.In May 2016, a few weeks before the referendum of 23 June 2016, we published a report entitled The process of withdrawing from the European Union1. That report described a still hypothetical process, drawing on expert evidence to analyse the terms of Article 50 of the Treaty on European Union (TEU), and seeking to set out the key legal and political issues in measured, dispassionate language. The report bears re-reading today, when many of the issues we canvassed, such as revocability of the Article 50 notification, the length of the negotiations, the links between the agreements on withdrawal and on future relations, and the consequences were the negotiations to break down without agreement, have become topics of often heated debate and argument.

2.The key difference between the process, as we outlined it in May 2016, and as it has in fact transpired, is time. In 2016 we envisaged a negotiation lasting until at least 2020, making use of the provision in Article 50 to extend the UK’s EU membership. Now, in contrast, the Government’s clear policy is that the UK will leave the EU on 29 March 2019, and that negotiations must be completed before that deadline. As the EU’s Chief Negotiator, Michel Barnier, has said, “the clock is ticking”.2

3.One consequence of this shortage of time is that both sides now accept that, as part of any deal, a transition period will be needed, in order to bridge the gap between the UK’s EU membership and the future relationship.

4.The aim of this report is to take stock: to summarise what ‘no deal’ would mean, and to set out some of the scenarios that might lead to that outcome; and to explore the aims and feasibility of a ‘transition’ period. Underpinning this report and our conclusions is the ticking of the Article 50 clock: as March 2019 approaches, lack of time will increasingly become the one dominant factor in the negotiations, and potentially a determinant of the UK’s future prosperity and security.

This inquiry

5.This inquiry was conducted between September and November 2017. We heard oral evidence on 31 October from the Secretary of State for Exiting the European Union, Rt Hon David Davis MP. In addition, we heard from a range of experts and stakeholders on both sides of the Brexit debate, including John Longworth, of Leave Means Leave, Ruth Lea CBE, Lord Darling of Roulanish, and representatives of the CBI, TUC and TheCityUK. We also received 47 written submissions. We are grateful to all our witnesses for their assistance.

6.We make this report for debate.

1 European Union Committee, The process of withdrawing from the European Union (11th Report, Session 2015–16, HL Paper 138)

2 At a press conference on 12 July 2017 Michel Barnier responded to comments by the Foreign Secretary, Rt Hon Boris Johnson MP, by saying: “I am not hearing any whistling, just a clock ticking.”

© Parliamentary copyright 2017