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Alan Dashwood – Ending a Bad Marriage with a Messy Divorce – Is this the Future of the UK’s Relationship with the European Union?

This post is an abridged version of the 2015 Durham European Law Institute Annual Lecture, delivered by Professor Sir Alan Dashwood QC in Durham on 27 February 2015. Its substance has been prepared by the DELI Blog editorial team from the full text of the lecture, with the kind permission of Professor Dashwood, and constitutes an abridgement of his original work. 

Introduction

The title of this lecture stems from a rather alarming discovery that this same metaphor has been used both by the arch-Eurosceptic, John Redwood, and by the President of the European Commission, Jean-Claude Juncker – the coincidence suggests that serious people on both sides of the argument are beginning to believe that UK withdrawal may actually happen.

A strong negative case can be made against withdrawal. The main focus of this lecture is going to be on part of that case, namely the complexity and burdensomeness of the withdrawal process and the difficulty of imagining what a satisfactory post-withdrawal relationship with the EU would look like.

We must not though make the same mistake as in the Referendum on independence for Scotland by focusing too much on the negative side of the argument. The positive case in favour of remaining in the Union needs to be made just as strongly. And the latter part of my lecture I want to begin a reflection on how that case can be formulated.

The Withdrawal Process

UK withdrawal would provide the first occasion for the use of the new procedure contained in Article 50 TEU. After a decision to leave has been made, notice must be given to the European Council. Negotiations on the arrangements for withdrawal are then initiated under the procedure in Article 218(3) TFEU, with an eventual agreement being concluded by the Council acting by QMV with the Parliament’s consent. The Treaties will cease to apply to the withdrawing state at the date of entry into force of the withdrawal agreement, or two years after the initial negotiation.

Article 50 therefore requires an effort to be made to achieve withdrawal in an orderly manner. It appears deceptively simple, however in reality there would be a huge mass of complex issues to resolve. For instance, disengagement from the EU institutions would have to be managed, including when all UK officials operating in the EU would leave their posts and where UK based EU agencies would relocate to. Disengagement from the common agricultural, fisheries and commercial policies would also have to be carefully worked out to avoid disputes.

Of particular delicacy would be the vested rights of individuals and businesses – part of orderly withdrawal would have to be transitional arrangements to protect those that have taken advantage of the free movement rights conferred by the Treaties. What would happen though in the event of a disorderly withdrawal if satisfactory arrangements could not be reached within two years? Would British nationals instantly forfeit their rights as EU citizens, and vice versa for EU citizens in the UK?

In my opinion there are strong grounds in EU law that rights already executed can survive independently. In Van Gend en Loos the Court decided that under the then EEC’s new legal order, individuals could acquire rights that became “part of their legal heritage”. Further developments such as the Court’s fundamental rights jurisprudence and the conferring of primary law status on the Charter of Fundamental Rights suggest a strong case that some vested rights, such as the right of permanent residence acquired after five years, through the operation of Article 20 of Directive 2004/38 (the so-called “Citizens’ Directive), should survive indefinitely.

The withdrawal of the UK would call for quite extensive amendments to the EU Treaties. All references to, and special status provisions of, the UK would have to be deleted. Arguably this could be effected by the Article 50 agreement, but if I am wrong about this a second agreement would have to be concluded using the much more onerous amendment procedure of Article 48 TEU.

The process of disentanglement from the EU would also require a range of unilateral actions by the UK. For instance, the European Communities Act 1972 and the European Union Act 2011 would have to be repealed, and a review of primary and secondary legislation implementing EU law would have to be conducted to see whether these should be retained, provided with new enabling power or repealed. Any directly applicable EU regulations considered beneficial would also have to be re-enacted.

The UK’s relations with the EU and the rest of the world after withdrawal

Most commentators assume that an attempt would be made to establish some kind of framework for post-withdrawal relations with the EU, and there is a debate about what form it would take. The main contenders are an association like the European Economic Area Agreement (EEA), a bundle of sectoral agreements like those between the EU and Switzerland, or a simple free trade agreement.

The EEA consists of two blocks, the European Free Trade Association (EFTA) countries and the EU. To become a party to the EEA Agreement, after withdrawing from the EU, we should first have to rejoin EFTA. This would entail unanimous agreement by the members of EFTA, which can’t be taken for granted. As a member of the EEA the UK would continue to enjoy free access to the EU’s internal market, however the EEA is not a customs union. If the UK joined the EEA, we wouldn’t be part of the common agricultural or fisheries policies, but would certainly be required to continue making a contribution to the EU budget, as a quid pro quo for market access. The major disadvantage though of EEA, as compared with EU, is that we should be obliged to apply a mass of EU legislation, in the making of which the UK would have played no part.

Our second option would be the Swiss model. This comprises a large number of bilateral agreements, of which one, the EU/Swiss Free movement Agreement of 1999 was held by the Court of Justice in a recent case to mean that Switzerland had been equated for the purposes of the Agreement to an EU Member State. Thus, the Swiss model is a pick-and-mix way of arriving at a result similar to the EAA, with the important qualification that as things stand Swiss firms do not have access to the internal market for financial services.

The third, more modest, option would be the conclusion of a free trade agreement between the UK and the EU. The scope of such an agreement would be a matter for negotiation. It’s uncertain how far the UK would be given access to the internal market for financial services under such an agreement. My guess is not very far.

Turning to the UK’s relationship with the rest of the world, a first issue is how withdrawal would affect the position of the UK under existing international agreements to which the EU is a party. The Member States are bound as a matter of EU law by trade agreements concluded under EU exclusive competences by the Union with third countries, but are not themselves party to them. Would the UK retain rights and obligations under these agreements, after it ceased to be a Member State of the Union?

For the future, it’s obvious that the UK would be on the outside of international agreements on trade and other matters that were negotiated and concluded by the EU. This applies also to any trade agreements that are subject to on-going negotiations, most importantly those on the Transatlantic Trade and Investment Partnership – unless we could persuade the negotiating parties to let us in as a third party. So, while withdrawal from the EU would mean that the UK recovered its power to act autonomously as a subject of the international legal order, we might find our newly recovered freedom rather lonely, especially in international trade negotiations.

The positive case

Let us turn to the positive case for staying in the Union. Three great themes, for me, explain why Europe and the wider world need the EU. These are peace and security; protection and promotion of democracy, the rule of law and human rights; and economic prosperity.

First and foremost, peace and security. The EU represents an important part of the solution to the old problem of rivalry between European nations. It was a wonderfully intelligent idea to bring together the warrior nations of Europe and their habitual victims under a set of constitution-like arrangements that, over time, would make it unthinkable for them ever to fight each other again. In the last decade of the 20th century the EU found itself faced with a new task – that of helping to reconfigure the political and security architecture of our continent, following the collapse of the Soviet empire, and the emergence on the EU’s doorstep of a large number of new States with no recent history of democratic government. We should be proud that the United Kingdom was in the forefront of those insisting that the prospect of membership of the EU be held out to the Baltic States and the countries of Central and Eastern Europe, even if that involved risks. For the UK to continue playing an effective role in maintaining the peace and security of Europe and its neighbourhood, we need to be part of the Union.

Second, the role of the Union in promoting democracy, the rule of law, human rights and liberal values generally. In some of its own Member States, the EU has helped to strengthen recent and fragile democratic institutions and the independence of the judiciary. The prospect of joining the EU has been a huge incentive for candidate countries in the post-Soviet era to develop their political and judicial institutions. More generally, EU institutions have tended to promote best practice in social policy and in the protection of the fundamental rights of individuals. This has brought improvements even in old-established democracies like the United Kingdom, in particular in anti-discrimination and employment law.

Third, the economic advantages for the members. There is the single market, which is intended to replicate the economic conditions of a domestic market comprising all 28 Member States – progress is still needed, however it does represent a very significant opening of Member States’ markets to competition. Although accompanied by a certain tendency towards over-regulation, it is noteworthy the countries like Norway and Switzerland want to be part of the single market, even if this means accepting legislation they have no part in making. Furthermore, the EU has much greater clout in international trade negotiations and in bodies like the World Trade Organisation than an individual Member State could ever have. It is worth adding that UK Governments have had a significant influence on the development of the EU’s international trade agenda, and that British Commissioners have played a leading part in this.

Conclusion

I don’t believe that UK withdrawal is inevitable or indeed very likely. My main worry is that there may be a bidding war in the run-up to the General Election, in terms of promises to negotiate EU reforms. What does seem clear is that, in the timescale set by the present Government, no reforms requiring Treaty amendments would be feasible, unless perhaps these can be effected under the simplified revision procedure applicable to Part Three of the TFEU. The most that may be possible, in practice, would be a set of clear commitments by the European Council.

The present Government has manoeuvred itself into a position where, if it achieves nothing of any substance, it may be forced to campaign on the side of withdrawal. That probably would be fatal, but I think it’s avoidable and certainly wouldn’t happen under the present Prime Minister. It won’t happen either, of course, if the Conservatives aren’t the biggest party after the General Election.

We live in interesting times. The marriage has had its ups and downs but, on the whole, it hasn’t been bad. Divorce would be horrible and its aftermath chancy. So, for goodness sake, let’s stick together, even if it’s probably too much to hope that we’ll all live happily ever after.

Prof Sir Alan Dashwood QC

Sidney Sussex College, Cambridge University

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