Tuesday, December 4, 2018

France's President Macron Effortlessly Destroys the Brexit Deal - Malcolm Lowe


by Malcolm Lowe

But it could be saved if May were less stubborn

  • We are most grateful to French President Emmanuel Macron for revealing that the problem of the "backstop" is far larger than anyone had realized. It was seen as merely a problem of good faith of the EU Commission toward the UK. Now we see that it is also a problem of good faith of all the 27 remaining members of the EU. The problem is 28 times larger than anyone had noticed.
  • The flaw in Article 20 of the "backstop" is that it permits the customs union dictated by the Protocol to continue forever unless both parties agreed to end it. What is needed is the reverse: a date on which the application of the Protocol ends unless both parties agree to continue it. Indeed, the length of the transition period starting on March 29, 2019 is defined in the reverse manner in the Withdrawal Agreement. So why did the UK's negotiators fail to demand something of the kind for Article 20?
  • Although UK Prime Minister Theresa May's Conservative critics do have the power to create a majority against her deal by voting with the opposition, there is a much greater majority in the Commons for preventing a no-deal exit. That is, there are other Conservatives who will themselves join the opposition in feverishly averting no-deal, and with good reason. Apart from May's Conservative critics, no-deal is unthinkable.

French President Emmanuel Macron has rudely falsified some of UK Prime Minister Theresa May's claims about the Brexit deal. No publicity campaign can disguise it. Pictured: Macron and May meet at the United Nations on September 26, 2018 in New York. (Photo by Spencer Platt/Getty Images)

On November 25, 2018, a summit meeting of the 27 remaining countries of the European Union approved the Brexit deal agreed with the UK's Theresa May. At the end of the summit, President Macron gave a press conference in which he announced how he would abuse the deal to blackmail the UK, thereby making approval of the deal in the UK Parliament unthinkable. This deal must be the shortest-lived treaty in history.

From the moment that Theresa May first presented the proposed Brexit deal to her cabinet on November 14 and to the House of Commons the next day, opposition to it has steadily risen among the MPs of her own Conservative Party. Also the Democratic Unionist Party of Northern Ireland (DUP), the coalition partner that gives her a small majority in the Commons, is unanimously opposed. May has earned respect for the resolution with which she promotes the deal amid a cacophony of opposed voices that offer no coherent alternative, but also amazement at the stubbornness with which she rejects any change to the deal, thereby ensuring its failure.

The Sticking Point

At the risk of repeating what everyone knows, let us explain the structure of the deal and the main sticking point that makes it unacceptable to many in May's own party. The deal consists of two documents, whose cumbrous titles we shall abbreviate as the Withdrawal Agreement (November 14, 2018) and the Framework for the Future Relationship (November 22, 2018; this is the final version of a shorter provisional text that was made available on November 14). The first document has itself, basically, two parts. What we can call the Main Part consists of 185 Articles occupying the first 300 pages, together with the nine Annexes occupying pages 504-585 (the end). The other part consists of pages 301-503, containing three Protocols on Ireland/Northern Ireland, Cyprus and Gibraltar, which pertain to European issues arising out of the earlier history of the UK.

The Main Part of the Withdrawal Agreement prescribes the steps to be taken during a "transition period" between 23:00 GMT (midnight in Brussels) on March 29, 2019, when the UK officially leaves the EU, and the end of 2020, when the UK ends all links with the EU that derive from its present membership in the EU (including trading and customs links). Further, the Main Part defines the residual rights of UK citizens vis-à-vis the EU and vice versa after the end of the transition period. The Framework outlines the intended future relationship between the UK and the EU that will replace all such previous links. Negotiations to turn the Framework into a full-fledged treaty are projected to be completed during the transition period, such that there will be a smooth switch from the current relationship to the future one.

All that might have commanded a majority in the Commons. For sure, the Labour Party has some objections to the Framework, but they could be addressed during the negotiations on its transformation into a treaty.

Indignation has focused instead on the Protocol on Ireland/Northern Ireland. Everyone is agreed that the Protocol addresses a genuine problem, but there is vehement opposition among MPs of the Conservative Party and the DUP to how the Protocol seeks to deal with the problem.

Because of the UK's membership in the EU, there are currently no controls between Northern Ireland and the Irish Republic on a border that is crossed by nearly 300 routes. If the transition period ends before the negotiations on the future relationship have been completed, that "soft border" could vanish. The Protocol, therefore, defines a temporary customs union between the UK and the EU that will then exist until those negotiations are complete and the resulting treaty comes into effect. The issue is particularly acute because the UK pledged to maintain a soft border in the agreements that ended the Northern Ireland "Troubles" of 1969-1998 (the terror campaign waged by the Irish Republican Army in order to force incorporation of Northern Ireland into the Irish Republic).

Both Theresa May and the EU Commission aver that the negotiations are sure to end on time and that the Protocol is merely a "backstop" that need never go into effect. There is, however, proverbially nothing as foreseeable as the unforeseen and nothing as permanent as the temporary.

To make matters worse, Article 20 of the Protocol, which defines how the UK may attempt to end the application of the Protocol, gives the UK no automatic right to do so. It states that the UK and the EU can at any time request each other to end the application of the Protocol. It also prescribes a tedious arbitration procedure to be followed if the request is refused by the other party, while the arbitration may validate the refusal anyway. Every MP in the Commons, it seems, except for May herself, sees a real and present danger that the Protocol may stay in operation for year after year, hindering the UK's ability to sign fresh trade deals with other countries. Quite correctly, about 100 Conservative MPs are refusing to vote for the deal as long as the UK has no right of exit from the Protocol.

Now comes President Macron's intervention, giving the deal a death blow. His news conference addressed a French concern: fishing in UK coastal waters after the UK leaves the EU. Whereas French boats can currently fish in those waters, Theresa May has been boasting that the deal restores to UK boats the exclusive right to do so. President Macron proclaimed that France will push the negotiations on the Future Relationship beyond the end of the transition period, thereby activating the Protocol and keeping the UK enslaved to the EU until he gets his way on fishing in UK coastal waters.

We are amazed at the stupidity with which Macron has revealed, already before the vote in the Commons, the joker that he holds in his hand. Likewise, we are most grateful to Macron for revealing that the problem of the "backstop" is far larger than anyone had realized. It was seen as merely a problem of good faith of the EU Commission toward the UK. Now we see that it is also a problem of good faith of all the 27 remaining members of the EU. The problem is 28 times larger than anyone had noticed.

May has tried to brush off the threat issued by Macron, citing the arbitration procedure in Article 20 of the Protocol. She is mistaken. The arbitration panel is merely permitted to rule whether the Protocol is still needed to ensure a soft border; it is not empowered to disqualify an attempt by an EU member to prolong the negotiations for its own benefit. The massive publicity campaign for her deal that May is planning before the vote in the Commons in mid-December will be in vain. Macron has rudely falsified May's claim that the Protocol is unlikely ever to be invoked. No publicity campaign can disguise it.

How to Modify the Problematic Protocol

What makes the matter so silly is that there are simple ways to modify the Protocol such that the UK will not be threatened with permanent subjugation to it. We believe that if the Commons approved the deal subject to this one change, May could go back to Brussels and confront the Commission with this demand. If the Commission refused, it would be convicted of responsibility for derailing the whole deal by the stubbornness with which it refused to change just one detail. May would thereby win back the opponents in her own party and become a hero to the public at large. Unfortunately, she maintains her own stubborn refusal to entertain any change in the deal whatsoever, to the despair of ministers who have hesitantly remained in her cabinet in the hope of effecting such a change.
The flaw in Article 20 of the "backstop" is that it permits the customs union dictated by the Protocol to continue forever unless both parties agreed to end it. What is needed is the reverse: a date on which the application of the Protocol ends unless both parties agree to continue it.

Indeed, the length of the transition period starting on March 29, 2019 is defined in the reverse manner in the Withdrawal Agreement. Article 126 of the Withdrawal Agreement states: "There shall be a transition or implementation period, which shall start on the date of entry into force of this Agreement and end on 31 December 2020." But Article 132.1 qualifies it: "Notwithstanding Article 126, the Joint Committee may, before 1 July 2020, adopt a single decision extending the transition period up to [31 December 20XX]." (Here "XX" signifies one or more years.) So why did the UK's negotiators fail to demand something of the kind for Article 20?

The "Joint Committee" referred to here is defined in Article 164 as a body "comprising representatives of the Union and of the United Kingdom" and "co-chaired by the Union and the United Kingdom," with the purpose of being "responsible for the implementation and application" of the Withdrawal Agreement. Both Article 164 and Annex VIII of the Withdrawal Agreement make it clear that the Joint Committee is to act always "by mutual consent."

A previous article already formulated the kind of simple modification required in Article 20:
Article 20 of the Protocol on Ireland/Northern Ireland should be supplemented by a sentence of the form: "If not earlier, this Protocol shall cease to apply [x] years after the end of the transition period unless both the Union and the United Kingdom agree to extend its application in whole or in part." Here "[x]" should be a number (of years) that is sufficiently large to convict the European Union of bad faith if it refuses to countenance such a sentence, but sufficiently small not to be absurd. We think that "three" would be a suitable number of years, but even "five" would establish the principle that the United Kingdom must have a guaranteed prospect of liberty.
In order to make this proposal conform with the language of Article 132, as just quoted, one can replace "both the Union and the United Kingdom agree" with "the Joint Committee decides." In view of Macron's impudent threat, however, perhaps something stronger is needed:
The application of this Protocol shall end after twelve months unless the Joint Committee decides to extend its application in whole or in part. The extension shall last for a period of not more than twelve months and any further extensions shall likewise require a decision of the Joint Committee and last for a period of not more than twelve months.
As the arbitration procedure defined in Article 20 would itself take most of a year, one could simplify matters by just replacing the whole of Article 20 with the above two sentences. In any case, the point is that there are easy ways to defang the menace incorporated in Article 20. Why has this not already been done? Mainly because of May's stubborn refusal to entertain the slightest change in the deal, but also because -- given that refusal -- her critics have thundered condemnation without proposing any specific change themselves.

According to unsubstantiated rumors, "Mrs May's Brexit adviser Olly Robbins has reportedly drawn up a secret blueprint to let Britain unilaterally abandon guarantees over the Irish border." Mere rumors will not save her. She needs to come out publicly with such a suggestion, present it to the Commons, invite constructive amendments, and promise that she will take the result to Brussels and tell the EU that the deal stands or fails on acceptance of this one change in the Withdrawal Agreement.

No-Deal Illusions

Many of May's Conservative critics are jubilant at the imagined prospect of the UK leaving the EU on March 29 with no deal whatsoever. The UK will save itself, they say, from paying its residual debt to the EU, as spelled out in Part Five of the Withdrawal Agreement (Articles 133-157). Then it can simply trade with the whole world on the terms of the World Trade Organization (WTO).

They are deluding themselves no less than May does -- and on both counts. The UK has set aside £39 billion as the estimated sum reached by deducting what the EU owes the UK from what the UK owes the EU, according to the Withdrawal Agreement. About half of the bill, however, relates to UK commitments that exist given any deal or none, such as the UK's share of projects belonging to "the Union programmes and activities committed under the multiannual financial framework for the years 2014-2020" (Article 137.1) and its share of "the Union's liability for pension rights and rights to other employment-related benefits accrued on or before 31 December 2020" (Article 142.2).

On the other hand, the UK trades below WTO tariff rates with much of the world because of deals made by the EU on behalf of its members. Those preferential tariffs would end immediately with no-deal on March 29 and before the UK has time to replace them in direct negotiations with the third-party countries concerned.

Although May's Conservative critics do have the power to create a majority against her deal by voting with the opposition, there is a much greater majority in the Commons for preventing a no-deal exit. Already on November 29, it is reported: "Tories and Labour MPs got together to table an amendment to get rid of Mrs May's deal, stop a no-deal Brexit and give MPs a choice in what follows." That is, there are other Conservatives who will themselves join the opposition in feverishly averting no-deal, and with good reason.

For one thing, much trade across the English Channel consist of "just-in-time" supplies of both components for industry and whole products for public institutions (like the National Health Service). All of a sudden, goods that flowed freely in both directions will be held up by the need to pay tariffs on every shipment. No-deal therefore means, as well, that long-dismantled storage capacity will have to be hastily erected afresh, but this will be too little and too slow. The chief executive of the Society of Motor Manufacturers and Traders has warned that three-quarters of its members believe a no-deal Brexit will threaten their viability, 20% say they have already lost business, one in 10 is cutting jobs, one in five is implementing contingency plans, and some are executing relocation plans. (It was the motor industry that pioneered "just-in-time" in the UK around 1980, importing the concept from Japan in order greatly to reduce the expense of storing vast inventories of components.)

For another, the first 125 articles of the Withdrawal Agreement (pages 6-195) cover issues that are vital to millions of individuals, such as the rights of UK citizens currently living or working in the EU and vice versa, intellectual property rights, police and judicial cooperation between the UK and EU, etc. All that excellent work of the negotiators will be lost with no-deal. Apart from May's Conservative critics, no-deal is unthinkable.

Malcolm Lowe is a Welsh scholar specialized in Greek Philosophy, the New Testament and Christian-Jewish Relations.

Source: https://www.gatestoneinstitute.org/13369/france-macron-brexit

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