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The Prime Minister Theresa May visited Strasbourg last night to hold last-minute talks with President of the European Commission Jean-Claude Juncker. Negotiations resulted in what the Prime Minister called legal assurances to the EU Withdrawal Agreement, which will prevent the backstop from becoming permanent.
The new legal assurances consist of three documents. The first is a joint legal interpretative instrument in relation to the backstop, which builds on the assurances issued in the joint letter by Juncker and European Council President Donald Tusk in January. The EU and UK have agreed in the instrument that it would be inconsistent with “good faith” and “best endeavours” requirements for “either party to act with the objective of applying the [backstop] Protocol indefinitely.” If either party were to act with this intention, the dispute would be brought before the independent arbitration panel. A ruling from the panel that one side was seeking to apply the protocol indefinitely would be binding, and could ultimately give the aggrieved party “the right to enact a unilateral, proportionate suspension of its obligations under… the Protocol.” The instrument also contains further assurances for Northern Ireland, and a joint commitment to establish a “negotiating track” to replace the backstop with “alternative arrangements.” These alternative arrangements “are not required to replicate [the backstop] in any respect, provided that the underlying objectives continue to be met.”
The second document is a joint statement supplementing the Political Declaration on the future UK-EU trading relationship. This reaffirms the UK and EU’s joint commitment to begin negotiating the future relationship as soon as possible, and makes it clear that the future relationship may apply provisionally pending ratification. It also includes EU recognition of the UK’s commitments on workers’ rights.
The third document is a unilateral declaration by the UK. This emphasises the UK’s interpretation that if agreement on a future relationship is not possible, then the UK would be able to begin “instigating measures that could ultimately lead to disapplication of obligations under the Protocol.”
May said, “The deal that MPs voted on in January was not strong enough in making that clear – and legally binding changes were needed to set that right. Today we have agreed them.” Juncker commented on the deal saying, “Let us be crystal clear about the choice – it is this deal or Brexit might not happen at all,” adding, “It is what we do with the second chance that counts. Because there will be no third chance. There will be no further interpretation of the interpretations and no further assurances on the reassurances.”
Elsewhere, the Irish Taoiseach, Leo Varadkar, said this morning that the changes were “positive” and that they would not “undermine the backstop.” He added, “I hope and trust that the withdrawal agreement will now be endorsed by the House of Commons.”
Labour’s Shadow Brexit Minister Keir Starmer said in a statement, “Having studied the documents, I would be surprised if they are sufficient to enable the Attorney General to change the central plank of his December legal advice…The Withdrawal Agreement does not include a mechanism for unilateral exit from – or termination of – the backstop (or any other part of the Agreement) even where bad faith is made out.”
Meanwhile, the Chairman of the European Research Group Jacob Rees-Mogg said that it is “too early to tell definitively but it’s [legal assurances] clearly a step in the right direction.” The former Brexit Secretary David Davis told Talk Radio this morning, “if [Attorney General Geoffrey] Cox says this has legal force – the requirement on alternative arrangements, date, arbitration… all those together make this just about acceptable to me,” adding, “it’s significantly better than what was presented in December.” Elsewhere, the Democratic Unionist Party’s (DUP) Westminster leader Nigel Dodds said, “All of this will need to be taken together and analysed very carefully because we are speaking at the moment without having had sight of the precise text.” The DUP’s Brexit spokesman, Sammy Wilson, told LBC that “it seems to fall short of what [the Prime Minister] herself has promised. But we want to give due diligence to what has been said.”
The Prime Minister will open the debate on the second meaningful vote around 1p.m. today. The MPs will start to vote first on amendments and then on the deal itself at 7 p.m. this evening. Attorney General Geoffrey Cox will also publish new legal advice on the Brexit deal this morning ahead of the debate.
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The Times reports that EU officials are preparing for an extension to Article 50 of at least one year. Martin Selmayr, the European Commission’s Secretary General, reportedly told EU27 ambassadors yesterday a Brexit delay could happen only once, and could be short if the Brexit deal is passed or longer if it does not, as the UK could hold a General Election. According to an EU diplomatic source, Selmayr told the meeting of ambassadors, “The EU will have to extend to allow time for [UK general] elections and [a] new government so that means until the end of the year .” He also said that an extension until European Parliament elections will not be useful, as “six weeks won’t fix anything.”
This comes as European Commission President Jean-Claude Juncker wrote in a letter to European Council President Donald Tusk that Brexit should be “complete before the European elections that will take place between 23-26 May this year,” adding that if the UK has not left the EU by then, “It will be legally required to hold these elections.”
The International Energy Agency (IEA), an intergovernmental organisation acting as a policy advisor to OECD states said yesterday, “Ongoing trade disputes between major powers and a disorderly Brexit could lead to a reduction in the rate of growth of international trade and oil demand.” The IEA added, “Confidence in the health of the world economy has deteriorated.”
The Financial Times
A new report by rating agency Moody’s suggests that tariffs under No Deal would have a negative impact on the production capabilities of global automakers who are based in the UK. In such a scenario, tariffs would be 10% and the agency argues that this would be a hard hit for automakers in the EU bloc who import cars from the UK. Moody’s vice-president Motoki Yanase said, “The UK production of these automakers is highly interconnected to the EU, and so a ‘No-Deal’ Brexit will create a significant negative impact through various channels, most notably, the cessation of tariff-free automobile trade with EU countries.” The UK automotive industry is especially vulnerable since 80% of domestic production was exported last year – half going to the EU.
Writing for ConservativeHome, Open Europe’s Henry Newman responds to a number of confusions about the Prime Minister’s Brexit deal and about the alternative options. He writes, “There are many myths about the Prime Minister’s deal and its alternatives. It’s certainly not perfect, and some aspects of the backstop are uncomfortable and sub-optimal,” adding, “Nonetheless, it often seems that the deal is not given a fair assessment, particularly against the other options actually available. Some critics clearly have something approaching a pathological mistrust of EU. Others have made a good faith decision to oppose it, on balance. But for those open to persuasion, look at the actual facts of the deal before it’s too late.”