• Brexit – where are we now?

Brexit – where are we now?

28 april 2017

On 29 March 2017, the UK invoked Article 50 of the Lisbon Treaty. This means that the Brexit procedure has officially started. However, UK’s Prime Minister, Theresa May, has called for a general election on 8 June 2017. Time to assess where we are now in the Brexit process.

Procedure in brief

Article 50 must be invoked in accordance with a country’s own constitutional requirements. 

Once invoked, there is a minimum of two years for the UK to negotiate an exit from the EU. Until then the UK remains within the EU and all that it entails, based on four pillars of EU membership:

  • The free movement of goods
  • The free movement of services and freedom of establishment
  • The free movement of persons (and citizenship) including the free movement of workers
  • The free movement of capital.

In order to exit from the EU, a withdrawal agreement will have to be concluded amongst the EU member states. This agreement is preceded by a negotiation period during which the EU member states set out the terms and conditions for the withdrawal agreement.

There is also likely to be a transitional period between the end of negotiations and the signing of a Free Trade Agreement between the UK and the EU. 

Timeline

A timeline had provisionally been set for the withdrawal procedure:

Slight delay due to general election in the UK

The president of the European Commission, Jean-Claude Juncker, has confirmed that the actual negotiations between the UK and the EU will, however, not start until after the general election in the UK on 8 June 2017. But the election will not delay the Brexit negotiations significantly. In this respect, the EU parliament has already adopted a resolution by a vast majority to decide on the key principles and conditions for its approval of the UK’s withdrawal agreement, in order to take full speed after the elections.

Red lines of the EU resolution

The “red lines” laid down in this resolution have been determined as follows:

Citizens first

  • Citizens’ interests must be at the forefront right from the beginning. In particular with respect to Irish citizens, all parties should remain committed to the Northern Island peace process;
  • Securing equal and fair treatment for EU citizens living in the UK and British citizens living in the EU. The resolution warns the UK against any attempt to limit the rights linked to the freedom of movement before it effectively withdraws from the EU. The resolution also asks the EU-27 to examine how to address the fear of British citizens that Brexit will lead to the loss of their current EU citizenship rights.

Negotiation principles

  • The resolution calls for the negotiations to be conducted in good faith and in full transparency;
  • Any negotiation between the UK and third countries on trade agreements would be considered a breach of EU law. The UK is not to engage in bilateral talks with one or several EU member states on the withdrawal proceedings or the EU-UK future relationship.
  • Withdrawal from the EU internal market implies that after the exit, the UK will no longer be able to enjoy similar benefits to those enjoyed by an EU member state.

Continued obligations

  • The UK will be part of the EU until its actual departure, meaning it will continue to enjoy its rights as a member of the EU until that date, but will also have to shoulder its (financial) obligations. The financial commitments could run beyond the date of departure.

Last but not least, the resolution states that transitional arrangements can only begin once “substantial” progress has been made towards a withdrawal agreement.

Keep up with Brexit news

In close collaboration with our UK colleagues, BDO Belgium is on top of any news on the progress of the UK withdrawal procedure.  

We kindly invite you to visit our Brexit site regularly to follow up on the milestones in this Brexit procedure.

Our experts are, of course, willing to help you assess the impact of these developments on your business.