'Brexit will be more complicated than many believe'

Jürgen Basedow explains why the UK can expect long, drawn-out negotiations - and why little is likely to change in the short run

November 02, 2016

On 23 June, the majority of British citizens voted for the UK to leave the European Union. On taking office, the new Prime Minister of the UK, Theresa May, announced that she would implement the decision swiftly. And she promised: “The supremacy of EU laws in this country will end forever.” Jürgen Basedow, Director at the Max Planck Institute for Comparative and International Private Law, believes that European rules will remain valid in the UK for a long time to come.

Jürgen Basedow, Director at the Max Planck Institute for Comparative and International Private Law

Mr. Basedow, why can’t the British simply “offer to continue trading duty-free, write a letter and leave”, as a Tory MP has proposed?

The UK has been a member of the European Union for 44 years. In that time, far-reaching agreements have been concluded, and hundreds of regulations and directives have been issued. These govern a broad range of areas. For example, there are comprehensive regulations on consumer protection, such as product liability and bans on misleading advertising. In labour law, there are clear guidelines on how to protect the health of workers and the rights of works councils. EU regulations exist on social security, environmental protection, bankruptcy proceedings, the admission of pharmaceutical drugs and so forth. When the British leave the EU, they will have to decide what will apply in place of all these standards.

Theresa May has announced that she will introduce a Great Repeal Bill during the next session of Parliament, which will reconvene in May 2017. What does that mean?

First of all, it’s about the fact that when the UK leaves the EU, the act by which the country adopted the EU regulations when it joined in 1972 will also be repealed. At the same time, the Great Repeal Bill will convert European standards, in particular EU directives, to national law. This move is dictated by time constraints. Article 50 of the Treaty on European Union allows just two years to negotiate an exit. The clock will begin to tick as soon as the British officially trigger Article 50. If the negotiations are not completed after 24 months and the deadline has not been extended, the EU treaties and, arguably, the regulations will become invalid in the UK without any clarification as to what law should apply. Theresa May wants to prepare the country for this eventuality.

If the EU provisions have already been implemented in British law, what will change for the British?

The approach will ensure legal certainty for entrepreneurs and citizens in the UK. The British Parliament will later decide whether to adopt all the standards and what needs to be changed. However, the difficulties for the British lie not in their own country but in the remaining EU countries. If the UK is no longer an EU member, British companies and service providers will lose many advantages they currently enjoy on the Continent. Lawyers, financial advisors, architects and many others will no longer automatically be allowed to do business in Germany, France or Sweden. The disadvantages will be especially pronounced in the judicial field: the decisions of British courts will no longer be automatically recognized in EU states. This applies even to simple cases, such as car accidents, and the question of which insurance company must pay.

Of course, the British would like to regulate these things in the exit negotiations.

That depends on how long they’re willing to negotiate. Given the enormous volume of EU regulations, it certainly can’t be achieved in the space of two years. I predict that the negotiations will take eight to ten years – unless the negotiators opt for an existing model, for example the treaties previously signed with Norway, Iceland and Liechtenstein. However, all these countries have had to accept certain compromises, for example the free movement of people, goods and capital, and freedom to provide services. Moreover, the free movement of people also includes the right to residence and the free movement of workers.

But that’s precisely what the British don’t want. They want less immigration.

Free movement is therefore certain to be the stickiest issue. Theresa May has stated: “Norway is not a model”. On the other hand, I’m sure that the EU will not budge from its insistence on freedom of movement. If time is short, the Norway model might therefore be adopted – at least as an interim solution. I find it hard to imagine that the UK will discuss every act of legislation piecemeal, especially as it will also have to negotiate with other countries beside the EU.

For example?

The EU has signed many international treaties with non-EU countries that will not automatically apply to the UK if it leaves the EU. They include, for example, agreements on aviation liability, copyright law and environmental protection as well as numerous trade agreements. China has announced that it is interested in signing a free trade agreement with the UK and at the same time said that the British should provide 500 people to work out the details. Apart from showing that Brexit is far more complicated than many have imagined, it also shows that the EU is more than a union of its member states: it is a player on the world stage. And that’s not so easy to replace.

 Interview: Mechthild Zimmermann

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