The Brexit explained: All you need to know

Since the Brexit referendum on June 23, 2016, to decide whether or not the UK should leave the European Union, negotiations for agreements have been taking place between the 2 parties. By far, the discussions have mainly covered how the UK leaves, not the consequences.

The 'divorce' deal or the withdrawal agreement

The ‘divorce' deal, also known as the withdrawal agreement, sets exactly how the UK leaves:

  • The EU imposition of a £39billion bill payment to the UK;
  • The refuse of a physical border as the frontier between the UK and the EU;
  • The conditions for the +1 million British citizens living in the EU as well as those for the +3 million European citizens living in the United Kingdom.

European relationships with the UK

As part of the European Economic Area, Norway, Iceland, and Liechtenstein have the closest relationship with the EU, followed by Switzerland that significantly contributes to the EU's finance. Next, we have the European Eastern Partnership, the Trade Agreement, and the European neighborhood policy which promotes the human rights and trade integration.

This is where Ukraine agreed to let the European Court of Justice have some jurisdictional power in her borders, and so consists of the requirement for Ukrainian participation in Interpol, the ‘EU's FBI'. Finally, Turkey has not complete independence in matters of Trade Policy.

The UK does not want to emulate any of these relationships, bringing its deal-breakers, reason why we end up in an inevitable no deal with the EU, and with the UK's regular relationship with other countries in the World Trade Organization (WTO), membership of which is basically every country on Earth.

The UK could stick with the deal-breakers and go alone or she can drop only a few of them, but she can't have both. She wants independence, but also a deeper and more comprehensive agreement with the EU, who finds impossible to satisfy those contradictory preferences.

A look at the bigger picture

Before the UK voted to Brexit, the imaginary EU wall encircled all the institutions and border complications, such as the Trade Deals, Free Movement of goods, services, capital, and people, the European Economic Area, and the European Court of Justice Jurisdiction. But now, the UK has to pick 2 vertexes from the impossible trinity:

  1. At the top, the Maximum Brexit: the exit where the UK leaves to build her own wall which would go straight across the Irish land to separate from the EU and resemble any other country. This wall between Northern Ireland and the Republic of Ireland has already existed in the past, so having it again would break the vital, political promise with the UK, which back then ended the violence and the troubles of their relationship.
  2. The trinity's second vertex is no wall across Ireland: the UK tries to walk away from the bloc, but not every country makes it: Northern Ireland stays in the EU while still being part of the UK, as British and also Irish with the right of leaving the UK and joining Ireland if she decides to do so. For the UK, this situation implies a wall inside the UK, which would mean having an external wall through the internal territory.
  3. The trinity's final vertex: no walls inside the UK. This would leave Northern Ireland behind while staying connected to her also with some of those institutions.

The UK refuses these 3 options, as none of them are acceptable. Ultimately, there's not a way to avoid the impossible trinity: from 3 vertexes, the UK has to pick 2.

So, there has been almost no progress over the Brexit long timeline. For the UK, there's nothing as permanent as a temporary solution, which doesn't. solve. anything.

 

Leaving the EU and the Transition Period

If all goes to plan, Britain will leave the EU officially on the 29th of March 2019 and the transition period will last until the end of 2020, to allow the UK and EU to arrange a trade deal, to give businesses the time to adjust and to leave the European Parliament. Normal trade, migration rights, and EU subsidies will remain the same, but British taxpayers will have to carry on paying EU bills. Afterward, it depends on its politicians and what kind of deal they manage to make.

Brexit scenarios

Many conservative MPs want a Maximum Brexit, as they consider it would restore UK democracy.

In opposition, other Tories and most of the Labour Party, the SNP, and the Lib Dems want to take a softer approach to Brexit, so fewer changes are introduced. The Government is somewhere in between trying to make both sides happy with the Chequers Deal.

However, if the UK does not reach an agreement before the deadline, it could immediately crash out of the EU with no transition period and the usage of Standard International Trading Rules.

In a no-deal scenario, British laws would separate from EU ones, and tariffs, extra inspections, and border checks would potentially kick in straight away. According to many experts, so would chaos across the UK and the EU, warning about a potential shock to the economy, even with disrupted deliveries of food and medical supplies, and huge delays at the UK's border, due to no agreement about custom checks. Also, without a trade deal, EU leaders are forced to install a hard border, whether it is a physical barrier or a police check, which would run between the Irelands, even if the Maximum Brexit supporters think of it as unnecessary to keep peace with Northern Ireland. Hopefully, it will not affect anybody's holiday plans...

A positive aspect for Britain would be the control of its borders and the possibility to create its own policies on migration, and its own rules.

So here we enter to the aspect of living abroad. As the Freedom of Movement will completely end between Britain and the EU, British citizens will lose the right to live and to work in Europe, the guarantee of free healthcare, and the pension value will decrease. In fact, there's no specific arrangement to protect Brits living abroad, apart from the countries in the announcing process of schemes for them. According to the Government, European citizens in Britain can stay, and their rights and privileges will be protected if they apply for the ‘Settled Status' by proving they live there and that they're not a security threat.

The soft Brexit scenario means no tariffs and minimal disruption but could cause political turmoil as they'd miss out on the possibility to create new trade deals for, i.e., the USA, and, in the other hand, Brexit supporters believe it would undermine UK national democracy. In Northern Ireland, it would mean less demand for a hard border, as most of the trade rules would align with the EU.

The Chequers Deal would protect everyone's rights and control immigration and the Free Movement. It also suggests signing up a common rulebook with the EU to allow the Trade Deal's harmonization, with no tariffs and delays on the border. For Northern Ireland, Theresa May hopes to avoid a hard border that could probably renew violence by the extremists, but her deal was rejected by MPs, meaning they're getting closer to a no-deal Brexit.

Click here for the further reading of Brexit possible scenarios

Then what's next?

They could either try to delay Brexit (so would open a huge legal and political minefield) or to call a second referendum: do people still want to leave the EU? Do they feel content with the Government's plan? But, they could enter a lengthy process of nothing new.

For now, politicians are just hoping they agree on a deal. Otherwise, there would be no transition period after the established date and the UK would not apply the EU laws.