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Research Papers from the EU

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The Brexit Negotiations: An Assessment Of The Legal, Political And Institutional Situation In The UK

is an in-depth analysis on the political and institutional situation in the United Kingdom following the referendum on the UK’s withdrawal from the EU, and was prepared by Charles GRANT from the Centre for European Reform.

This research paper was requested by the European Parliament’s Committee on Constitutional Affairs (AFCO) and was commissioned, overseen and published by the Policy Department for Citizens’ Rights and Constitutional Affairs.

http://www.europarl.europa.eu/RegData/etudes/IDAN/2017/583130/IPOL_IDA(2017)583130_EN.pdf

In a number of findings the research concludes that:

The outcome of the Brexit talks will be shaped to a large degree by the EU governments. They are mostly united in taking a hard line. Worried about the cohesion and unity of the EU, they do not want populist leaders to be able to point to the British and say, “They are doing fine outside the EU, let us go and join them.” Exiting must be seen to carry a price.

There are only three possible outcomes of the Brexit talks:

  • a separation agreement plus an accord on future relations including an FTA;
  • a separation agreement but no deal on future relations, so that Britain has to rely on WTO rules;
  • neither a separation agreement nor a deal on future relations, so that Britain faces legal chaos and has to rely on WTO rules

The Impact and Consequences of Brexit for Northern Ireland

is a Briefing paper prepared by Jonathan Tonge from the University of Liverpool in the UK on behalf of European Parliament’s Committee on Constitutional Affairs (AFCO).

http://www.europarl.europa.eu/RegData/etudes/BRIE/2017/583116/IPOL_BRI(2017)583116_EN.pdf

The paper explores the legal position and other issues concerning Northern Ireland in relation to the UK and Ireland and discusses a number of topics:

  • The Legal position
    • UK government legislative dominance over the Northern Ireland Assembly
    • Challenges to the UK government’s domination of the EU withdrawal process
    • The legal upholding of the UK government’s position
    • The impact of EU withdrawal upon legislation for Northern Ireland
  • Issues relating to the Good Friday Agreement
    • Political stances on EU withdrawal
    • The Good Friday Agreement and Northern Ireland Assembly legislation
    • The Good Friday Agreement and EU membership
    • EU membership references in the Good Friday Agreement
    • How can the Good Friday Agreement be revised?
  • Implications of Brexit for Northern Ireland
    • Issues of free movement: The Common Travel Area
    • Cross-border trade, tariffs and the Customs Union

References

More research and analysis papers from the EU can be found at
http://www.europarl.europa.eu/supporting-analyses

The Centre for European Reform is a think-tank devoted to making the EU work better, and strengthening its role in the world. They are pro-European.
https://www.cer.org.uk

Brexit Negotiations – Who’s Who

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Theresa May has indicated that she will invoke Article 50 on Wednesday 29 March 2017. This is the formal notification required to indicate the intention of the UK to withdraw from the EU.

Significant figures in the Brexit negotiations are:

For the UK

Theresa May – Prime Minister, UK

David Davis – Secretary of State for Exiting the EU

Boris Johnson – Foreign Secretary

Philip Hammond – Chancellor of the Exchequer

Liam Fox – Secretary of State for International Trade

For the EU

The UK will be in negotiation with all 3 EU institutions, the European Commission, European Council and European Parliament represented by:

Michel Barnier – European Commission Chief Brexit Negotiator

Didier Seeuws – Council Special Taskforce Chief Negotiator

Guy Verhofstadt – European Parliament Chief Negotiator on Brexit

Notification of Withdrawal Bill

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As a result of the decision of the Supreme Court requiring Parliamentary approval to invoke Article 50, the European Union (Notification of Withdrawal) Bill 2016-17 was introduced to Parliament by David Davis on 26 January 2017.

https://www.publications.parliament.uk/pa/bills/cbill/2016-2017/0132/17132.pdf

Other documents can be found at

http://services.parliament.uk/bills/2016-17/europeanunionnotificationofwithdrawal/documents.html

A briefing paper from the House of Commons Library is available at

Full Report: http://researchbriefings.files.parliament.uk/documents/CBP-7884/CBP-7884.pdf

Summary: http://researchbriefings.parliament.uk/ResearchBriefing/Summary/CBP-7884

The Bill is debated, first in the House of Commons and then in the House of Lords.

House of Commons

1st Reading

The Bill was presented to the House of Commons and given its 1st Reading on Thursday 26 January 2017. This stage is formal and takes place without debate.

2nd Reading

The 2nd Reading of the Bill took place over two days on 31 January and 01 February 2017 when MPs could debate the bill. Usually the second reading of a bill is conducted over a single day, but in this case, the time was extended over 2 days due to the importance of the bill. Parliamentary time was also extended to Midnight on the first day.

Jeremy Corbyn imposed a three-line whip on Labour MPs, directing them to vote for the Bill, because the Shadow Cabinet had agreed not to block Article 50. It is called a three-line whip because the instruction from the Labour Chief Whip is underlined three times, meaning MPs must vote as directed or risk being disciplined.

The Bill passed the 2nd Reading by 498 votes to 114 and proceeded to a Committee of the Whole House for consideration of possible amendments to the Bill.

Committee Stage

The Committee stage took place over 3 days 6th, 7th and 8th of February 2017

There were 175 Amendments to the Bill for consideration by MP’s. Details of these amendments are contained in the following documents:

Amendments – Monday 6th February

Amendments – Tuesday 7th February

Amendments – Wednesday 8th February

None of the amendments were accepted, following a number of votes, and the Bill was passed in its original form.

Report Stage and 3rd Reading

MPs approved the 3rd Reading of the European Union (Notification of Withdrawal) Bill on Wednesday (evening) 8 February 2016 by 494 votes to 122, giving a majority of 372.

The Bill was passed to the House of Lords for further scrutiny, possible amendments, and vote.

House of Lords

1st Reading

The Bill passed the 1st reading in the House of Lords on 8 February 2017.

The House of Lords is in recess from 10 February to 20 February

2nd Reading

The 2nd reading of the Bill took place over 2 days, 20th and 21st February 2017.

The 2nd reading of the Bill was completed on 21 February.

Committee Stage

The committee stage of the Bill took place over 2 days 27 February 2017 and 01 March 2017. It was completed on 01 March 2017.

By a vote of 358 to 256, the following amendment was agreed:

Baroness Hayter of Kentish Town moved amendment 9B, in clause 1, page 1, line 3, at end to insert:

“( ) Within three months of exercising the power under section 1(1), Ministers of the Crown must bring forward proposals to ensure that citizens of another European Union or European Economic Area country and their family members, who are legally resident in the United Kingdom on the day on which this Act is passed, continue to be treated in the same way with regards to their EU derived-rights and, in the case of residency, their potential to acquire such rights in the future.”

Report Stage and 3rd Reading

Following the Committee Stage, the Report Stage was held on 7 March 2017, the Bill was discussed in a number of sittings and Amendments were agreed.

This was followed by the 3rd reading of the Bill and after further debate, the Bill was returned to the House of Commons with amendments on 7 March 2017.

The suggested amendments are:

Ping Pong

In order for a Bill to become Law, both the House of Commons and the House of Lords must agree on the final wording in the Bill. If the House of Lords suggests amendments should be made, the Bill is passed back to the House of Commons for further debate, to consider those changes.

This process is known as “ping pong“. If the House of Commons agrees to the amendments the Bill passes on to the next stage, otherwise, the House of Commons can reject the amendments or make further changes/additions and pass the Bill back to the House of Lords for further debate. At this stage the House of Lords can accept what the Commons has decided, or offer further amendments and return it to the House of Commons. This process could continue indefinitely but can be limited by the time available for debate.

It is unlikely that the House of Lords will reject a Bill more than once, and the House of Commons has an option to use the Parliament Act to override (and ignore) amendments made by the House of Lords.

http://www.parliament.uk/about/how/laws/parliamentacts/

The Bill was received back in the House of Commons and debated on 13 March 2017. Both amendments were rejected, Amendment 1 by 335 votes to 287 and Amendment 2 by 331 votes to 286, for the following reasons

The Commons disagree to Lords Amendment 1 for the following reason—

Because it is not a matter that needs to be dealt with in the Bill.

The Commons disagree to Lords Amendment 2 for the following reason—

Because it is not a matter that needs to be dealt with in the Bill.

The Bill was returned to the House of Lords.

After further debate, the House of Lords did not insist on their amendments and the Bill completed its journey through the Houses of Parliament on 13 March 2017.

Royal Assent

This stage is when the Queen formally agrees to make the Bill into an Act of Parliament and becomes Law.

The Bill was granted Royal Assent and announced by the Speaker in the House of Commons on 16 March 2017 who stated:

I have to notify the House, in accordance with the Royal Assent 1967, that her Majesty has signified her royal assent to the following acts: Supply and Appropriation (Anticipation and Adjustments) Act 2017, European Union (Notification of withdrawal) Act 2017.

The Prime Minister can now legally begin the formal process of leaving the EU by invoking Article 50 of the Treaty on European Union (Lisbon Treaty).

Three Knights Opinion

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Law firm Bindmans LLP, based in London UK, has published a legal Opinion “IN THE MATTER OF ARTICLE 50 OF THE TREATY ON EUROPEAN UNION – Opinion“, which considers legal questions arising from the process of leaving the European Union.

This is also known as the Three Knights Opinion.

An article (17th february 2017) discussing the Opinion in more detail is available on Bindmans website at

https://www.bindmans.com/news/withdrawal-bill

The Three Knights Opinion was prepared by Sir David Edward, former judge of the European Court of Justice, Sir Francis Jacobs, that Court’s former Advocate General, and distinguished EU lawyer Sir Jeremy Lever (retired) together with two QCs Helen Mountfield and Gerry Facenna.

It explores the following questions

(i) What are the United Kingdom’s ‘constitutional requirements’ for a decision to withdraw from the European Union, within the meaning of paragraph 1 of Article 50 of the Treaty on European Union (‘TEU’)(‘Article 50’)? Do they include a requirement for an Act of Parliament approving the terms of withdrawal at the end of the Article 50 process?

(ii) Does Article 50 permit the United Kingdom to decide to withdraw from the European Union, and notify its ‘intention’ to do so, subject to the fulfilment of constitutional requirements, such as an Act of Parliament approving the terms of withdrawal? If such constitutional requirements are not satisfied, would the notification lapse, or could it be withdrawn, before the end of the two-year period referred to in the third paragraph of Article 50?

(iii) What is the position if the United Kingdom and the European Union do not reach any agreement?

In summary, the Opinion suggests that after the European Union (Notification of Withdrawal Bill) is passed through Parliament, the Prime Minister will be able to notify the EU of the UKs intention to leave the EU, but actual withdrawal from the EU has to be authorised by Parliament after negotiations have completed.

The compete, published document is available at

https://www.bindmans.com/uploads/files/documents/Final_Article_50_Opinion_10.2.17.pdf

Background

CrowdJustice is a crowd-funding platform to raise funds specifically for legal cases.

The CrowdJustice campaign Leaving the European Union: Should Parliament decide? organised by Jolyon Maugham QC raised £10,665 pledged by 406 people.

https://www.crowdjustice.org/case/should-parliament-decide/

It posed the question “Can the Prime Minister decide whether to leave the EU or does it require an act of Parliament?”. The funds were used to take advice from leading lawyers and to write to the government to determine its position.

The People’s Challenge to the Government on Art. 50: A Parliamentary Prerogative is a campaign, organised by Grahame Pigney, which raised more tham £170,000, pledged by 4918 people.

https://www.crowdjustice.org/case/parliament-should-decide/

It was created to challenge the ability of the Government being able to trigger Article 50 without requiring an Act of Parliament.

The People’s Challenge campaign is represented by a team from Bindmans LLP led by John Halford and their barristers are Helen Mounfield QC, Gerry Facenna QC, Tim Johnston and Jack Williams.

Following on, is the crowd-funding campaign The Second People’s Challenge: helping Parliament take control on Article 50, also organised by Grahame Pigney and which has raised more than £57,000 to date.

https://www.crowdjustice.org/case/parliament-take-control/

The Second People’s campaign is lobbying MPs and Peers to assist them in their decision making process during the passage of the European Union (Notification of Withdrawal Bill) through Parliament and afterwards during subsequent negotiations with the EU.

The Three Knights Opinion detailed above was commissioned, published and circulated to all Peers using funds provided from these self styled “People’s Challenge” campaigns.

Other documents produced include:

A guide to EU citizenship rights at stake in the negotiations (which was circulated to all MPs).

https://www.bindmans.com/uploads/files/documents/UK_Parliament_EU_Citizenship_rights_booklet.pdf

An amendment briefing sent to all Peers

https://www.bindmans.com/uploads/files/documents/EU_Notification_Bill_-_Lords_Committee_Stage_briefing_on_the_parliamentary_approval_amendment.pdf

Government White Paper

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David Davis presented a White Paper “The United Kingdom’s exit from and new partnership with the European Union White Paper” to Parliament on 2 February 2017. This paper describes the Governments plan for leaving the EU and outlines the 12 point plan previously mentioned by Theresa May.

The main areas (12 points) extracted from the published paper are:

  1. Providing certainty and clarity – We will provide certainty wherever we can as we approach the negotiations.
  2. Taking control of our own laws – We will take control of our own statute book and bring an end to the jurisdiction of the Court of Justice of the European Union in the UK.
  3. Strengthening the Union – We will secure a deal that works for the entire UK – for Scotland, Wales, Northern Ireland and all parts of England. We remain fully committed to the Belfast Agreement and its successors.
  4. Protecting our strong and historic ties with Ireland and maintaining the Common Travel Area – We will work to deliver a practical solution that allows for the maintenance of the Common Travel Area, whilst protecting the integrity of our immigration system and which protects our strong ties with Ireland.
  5. Controlling immigration – We will have control over the number of EU nationals coming to the UK.
  6. Securing rights for EU nationals in the UK, and UK nationals in the EU – We want to secure the status of EU citizens who are already living in the UK, and that of UK nationals in other Member States, as early as we can.
  7. Protecting workers’ rights – We will protect and enhance existing workers’ rights.
  8. Ensuring free trade with European markets – We will forge a new strategic partnership with the EU, including a wide reaching, bold and ambitious free trade agreement, and will seek a mutually beneficial new customs agreement with the EU.
  9. Securing new trade agreements with other countries – We will forge ambitious free trade relationships across the world.
  10. Ensuring the UK remains the best place for science and innovation – We will remain at the vanguard of science and innovation and will seek continued close collaboration with our European partners.
  11. Cooperating in the fight against crime and terrorism – We will continue to work with the EU to preserve European security, to fight terrorism, and to uphold justice across Europe.
  12. Delivering a smooth, orderly exit from the EU – We will seek a phased process of implementation, in which both the UK and the EU institutions and the remaining EU Member States prepare for the new arrangements that will exist between us.

The White Paper is 75 pages log and can be obtained from the Government website at:

https://www.gov.uk/government/publications/the-united-kingdoms-exit-from-and-new-partnership-with-the-european-union-white-paper

A local copy of the paper is also available here:

The United Kingdoms exit from and partnership with the EU

Process to invoke Article 50

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Although it would seem that the process for invoking Article 50 should be straightforward, a legal case was initiated to determine whether the Government can use Royal Prerogative Powers to start the process of leaving the EU.

Gina Miller engaged the City law firm Mishcon de Reya to challenge the authority of the British Government to invoke Article 50 of the Treaty on European Union using prerogative powers, arguing that only Parliament can take away rights that Parliament has granted.

After a hearing on 03 November 2016, the High Court of Justice ruled that Theresa May cannot use the Royal Prerogative Powers to invoke Article 50 and begin the process for withdrawal from the EU and she needs prior Parliamentary approval.

Judgement: https://www.judiciary.gov.uk/wp-content/uploads/2016/11/r-miller-v-secretary-of-state-for-exiting-eu-amended-20161122.pdf

Summary: https://www.judiciary.gov.uk/wp-content/uploads/2016/11/summary-r-miller-v-secretary-of-state-for-exiting-the-eu-20161103.pdf

(LOCAL COPIES)

The Government decided to appeal the High Court’s decision and took the appeal directly to the Supreme Court.

The Supreme Court is the final court of appeal in the UK for civil cases, and for criminal cases from England, Wales and Northern Ireland. It hears cases of the greatest public or constitutional importance affecting the whole population.

https://www.supremecourt.uk

The appeal hearing was held from 5-8 December 2016 with the decision to be issued in January 2017.

Details of the case and proceedings can be found at

https://www.supremecourt.uk/news/article-50-brexit-appeal.html

The judgement by the Supreme Court was issued on 24 Jan 2017. The Secretary of State’s appeal was dismissed by a majority of 8-3. In a joint judgement of the majority, the Supreme Court holds that an Act of Parliament is required to authorise ministers to give Notice of the decision of the UK to withdraw from the European Union.

The judgement documents are available at:

Judgement : https://www.supremecourt.uk/cases/docs/uksc-2016-0196-judgment.pdf

Summary: https://www.supremecourt.uk/cases/docs/uksc-2016-0196-press-summary.pdf

(LOCAL COPIES)

A useful article, interpreting details of the judgement by Robert Craig: Miller Supreme Court Case Summary can be found at

https://ukconstitutionallaw.org/2017/01/26/robert-craig-miller-supreme-court-case-summary/

The Supreme Court decided that the Government is not obliged to consult with the UK’s devolved assemblies before triggering Article 50 and also ruled that once Article 50 is triggered, it cannot be reversed.

The form that the legislation should take was not defined and is entirely a matter for Parliament but Parliament will need to pass a new bill that gives Government the authority to trigger Article 50.

A statement, following the ruling, from Number 10 added :

The British people voted to leave the EU, and the Government will deliver on their verdict – triggering Article 50, as planned, by the end of March. Today’s ruling does nothing to change that.

It’s important to remember that Parliament backed the referendum by a margin of six to one and has already indicated its support for getting on with the process of exit to the timetable we have set out.

We respect the Supreme Court’s decision, and will set out our next steps to Parliament shortly.

Opposition leader Jeremy Corbyn reacted to the judgment by saying that his party will not seek to frustrate the will of the British people, but did say that “Labour will seek to amend the Article 50 Bill to prevent Conservatives using Brexit to turn Britain into a bargain basement tax haven.”

Brexit Update – Part 1

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An update on what’s been happening since my last article on 24 July 2016

In one of his first comments following the result of the EU Referendum, Jeremy Corbyn stated that:

“The British people have made their decision. We must respect that result and Article 50 has to be invoked now so that we negotiate an exit from European Union. Quite clearly negotiations must take place. There must be the best deal possible in order to ensure strong industries in Britain stay strong and strong industries that have big export markets protect retain those export markets. But we are in some very difficult areas.”

During the summer holiday period in 2016 there did not appear to be much happening.

Although a new leader was appointed by the Conservative Party in a relatively short timeframe, it took longer for the Labour Party to make a choice following the challenge to the leadership of Jeremy Corbyn.

After a long process, which began shortly after the EU Referendum, Jeremy Corbyn retained the leadership of the Labour Party with a convincing majority when the result was announced on Sep 24.

Theresa May coined the phrase “Brexit means Brexit” in response to questions about what Brexit meant but with little extra definition.

BREXIT Negotiations

The type of relationship that the UK has with the EU following Brexit has been under much discussion with speculation about a “Hard Brexit”, a “Soft Brexit” or whether to follow the relationship that other countries such as Norway and Switerland have with the EU.

It is not clear where the terms “Hard Brexit” and “Soft Brexit” originated. The terms are used in an attempt to describe the type of relationship with the EU that may result after negotiations are completed. “Hard” implying that the UK ends up trading with the EU under the rules of the World Trade Organisation (WTO) with no tariff free access to the EU Single Market, and has no obligations to the EU. “Soft”, on the other hand, implies that the UK retains access to the EU Single Market but in return accepts some form of restricted membership of the EU and includes following the 4 fredoms of the EU which are defined as the freedom of movement for goods, people, services and capital across national boundaries.

The UK is currently excluded from meetings with other EU countries when the topic relates to the UK leaving the EU.

Statements issued by EU leaders have also emphasised on numerous occasions that:

  • There will be no discussion on Brexit until Article 50 has been invoked.
  • The UK must honour the principle of free movement of people if it wants to retain access to the single market after it leaves the EU.

Details about the 4 freedoms from

http://www.europarl.europa.eu/atyourservice/en/displayFtu.html?ftuId=FTU_3.1.3.html

“One of the four freedoms enjoyed by EU citizens is the free movement of workers. This includes the rights of movement and residence for workers, the rights of entry and residence for family members, and the right to work in another Member State and be treated on an equal footing with nationals of that Member State. Restrictions apply in some countries for citizens of Member States that have recently acceded to the EU. The rules on access to social benefits are currently shaped primarily by the case law of the Court of Justice.”

The former French Foreign Minister Michel Barnier has been appointed by the European Commission to lead the negotiations on behalf of the EU.

At the beginning of October, during the Conservative Party conference, Theresa May announced that the UK would begin formal Brexit negotiations by the end of March 2017. She also promised to introduce the Great Repeal Bill to remove the European Communities Act 1972 from the statute book and enshrine all existing EU law into British law. The repeal of the 1972 act will not take effect until the UK leaves the EU under Article 50. The Government has indicated that these legal changes within the Bill would take effect on “Brexit Day”: the day the UK officially leaves the European Union (EU).

Theresa May’s speech can be seen at https://youtu.be/08JN73K1JDc

The Secretary of State for Exiting the European Union, David Davis, has later emphasised the difference between the Article 50 process and the Great Repeal Bill:

The great repeal Bill is not what will take us out of the EU, but what will ensure the UK statute book is fit for purpose after we have left. It will put the elected politicians in this country fully in control of determining the laws that affect its people’s lives—something that does not apply today.

A Research Briefing Legislating for Brexit: the Great Repeal Bill was issued on 21 November 2016. A summary is available at

http://researchbriefings.parliament.uk/ResearchBriefing/Summary/CBP-7793

where you can also find a link to the full report.

Alternatively a copy of the full report is available here

https://eureferendum.kf12.com/wp-content/uploads/2017/02/CBP-7793.pdf

What’s happened since the EU Referendum

24 July 2016

It’s been a month since the EU Referendum where a majority of the electorate voted for the UK to leave the EU.

Here is a summary of the major events that have occurred since then.

Financial

The Governor of the Bank of England, Mark Carney,  was quick to make a statement following the EU referendum result.

Statement from the Governor of the Bank of England following the EU referendum result

You can watch his statement at

http://www.bankofengland.co.uk/publications/Pages/news/2016/056.aspx

FX Market

One of the first effects was seen in the financial markets with the Pound falling in value against the US dollar.

Looking at the spot inter-bank market rate, the biggest drop was on the 24 June showing the rate opening at 1.00GBP = 1.48USD and closing at 1.00GBP = 1.36USD.

The rate continued to fall, but more slowly for the next 2 weeks reaching 1.00GBP = 1.29USD on the 8 July.

On the 22 July the rate opened at 1GBP = 1.32 and closed at 1 GBP = 1.31 USD and appears to have settled down at least for the time being.

ref: https://www.poundsterlinglive.com/best-exchange-rates/british-pound-to-us-dollar-exchange-rate-on-2016-07-24

Precious Metals

As the pound was falling, the price of precious metals started to rise. On the 24 June, the spot price for Gold was £955.84 per troy ounce rising to a high of £1,056.79 per troy ounce on the 6 July and currently, on the 22 July, the price was £1,008.66

Stock Market

The Brexit vote caused a wave of panic selling by those gamblers, sorry traders, in the Stock Market with the Footsie 100 Index falling steeply after trading began but recovering to finish 199 (3.1%) points down at 6138.69 on the 24 June. After the weekend, the selling continued and the Footsie stood at 5982.2 at the close. After that, stocks started to rise and the Footsie was at 6577.83 by the 1 July and on the 22 July was at 6730.48 (which is around where it was in Aug 2015!).

ftse100

Political

The result also caused various political upheavals.

Conservative Party

Prior to the referendum Cameron had claimed (18th June) that he was the best person to negotiate any post-referendum deal and would remain “whatever” the result.

from the Independent newspaper:

http://www.independent.co.uk/news/uk/politics/eu-referendum-david-cameron-resign-step-down-boris-johnson-brexit-stay-as-prime-minister-result-poll-a7088811.html

from the Telegraph newspaper:

http://www.telegraph.co.uk/news/2016/06/18/david-cameron-insists-he-will-stay-on-as-prime-minister-regardle/

However, Cameron was quick off the mark and decided to resign as Prime Minister as the result hadn’t gone his way.

Cameron’s Resignation Statement

also at

https://www.gov.uk/government/speeches/eu-referendum-outcome-pm-statement-24-june-2016

In his resignation speech, he said he would stay until a new Prime Minister was in place, which was expected to happen by the 1st October.

Following Cameron’s statement 5 MPs presented themselves as candidates for the leadership: Stephen Crabb, Liam Fox, Michael Gove, Andrea Leadsom and Theresa May. Nominations closed at noon on 30th June 2016.

(Boris Johnson, an early favourite, decided not to run in the competition for leader after Michael Gove announced that he would run).

The process for election as leader of the party (and thus the next Prime Minister) is first put to a serious of ballots (voted by MPs) to determine 2 candidates who are sent forward to a ballot by all Conservative party members.

In the 1st ballot (5th July) May obtained more than half the votes of MPs with 165 votes, followed by Leadsom with 66, Gove with 48, Crabb with 34 and Fox with 16 votes. Fox was eliminated and Crabb withdrew leaving May, Leadsom and Gove to contest the next ballot.

In the 2nd ballot (7th July) May obtained 199 votes followed by Leadsom with 84 and Gove with 46.
Gove was eliminated, leaving May and Leadsom to proceed to the final ballot by all party members.

A few days later, 11 July, Andrea Leadsom withdrew from the contest and Theresa May was duly elected, unopposed, as the new leader of the Conservative Party without the need for a ballot by members.

On the 13 July, David Cameron relinquished his position as Prime Minister and Theresa May accepted a request from the Queen to become Prime Minister and immediately started creating her new government team.

Most notable positions in her cabinet are Philip Hammond as Chancellor, Boris Johnson as Foreign Secretary, Amber Rudd as Home Secretary, David Davis as Secretary of State for Exiting the EU (Brexit Minister) and Liam Fox as head of the Department for International Trade. Andrea Leadsom is appointed Secretary of State for the Department of Environment, Food and Rural affairs (DEFRA). Michael Gove and Stephen Crabb have not been appointed to positions in the new cabinet.

Labour Party

Jeremy Corbyn was elected as leader of the Labour Party after Ed Milliband resigned as leader following the 2015 General Election. His election as leader was never fully respected by his fellow MPs even though he had over whelming support from ordinary members of the Labour Party. (New members who had paid a joining fee of £3.00 were able to vote in the election).

After criticism of his lacklustre support for the Remain campaign,  the sacking of his Shadow Foreign Secretary Hilary Benn (25 June) who had expressed no-confidence in Corbyn’s leadership,  and resignations from over 20 members of the Shadow Cabinet,  a no confidence vote in his leadership  (28 June)  supported by 172 Labour MPs  vs 40 MPS supporting Corbyn resulted in a formal challenge to his leadership.

Angela Eagle announced her intention to contest the leadership on 11 July. After some debate by the National Executive Committee (NEC) of the Labour Party (12 July), it was determined that Corbyn could be included in the contest without needing nominations from other Labour MPs.  The NEC also decided to vary the rules that so that new members who had joined in the last 6 months  would not be allowed to vote. (130000 new members have joined the Labour Party paying their joining fee of £3.00 since the EU referendum). Registered supporters were, however, given the option to pay a further fee of £25  which would allow them a vote.

Owen Smith announced his intention to contest the leadership on 13 July.

Prior to nominations closing on 20 July, Angela Eagle withdrew leaving a straight contest between Corbyn and Owen Smith.

The ballot is not due to close until 21 September so the leadership contest is going to drag on for some time yet.

UKIP

Nigel Farage announced on the 4 July his intention to resign as the UKIP leader as he had achieved his aim which was to get the UK out of the EU .

http://www.bbc.co.uk/news/uk-politics-36702384

SNP

The Scottish First Minister, Nicola Sturgeon was quick to make a statement (24 June) claiming it was democratically unacceptable for Scotland to be taken out of the EU against its will. She also stated that a  second referendum for independence for Scotland from the UK was highly likely. This is a theme that is likely to remain for some time.

Nicola Sturgeon travelled to Brussels on the 29 June in an attempt to talk with EU leaders about Scotland  retaining their membership of the EU. She was rebuffed by Donald Tusk, President of the European Council, who felt it would not be appropriate, although she did meet with Jean-Claude Juncker, President of the European Commission, and Martin Shulz, President of the European Parliament.

It is likely that the only way for Scotland to become members of the EU would be to follow the application process in the same way as for any other State. This could only happen if Scotland were independent from the UK

 

EU Referendum 2016 – Results

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The referendum on continued membership of the European Union was held on June 23 2016 and the results were declared on June 24 2016.

The following figures were obtained from the Electoral Commission

http://www.electoralcommission.org.uk

The total electorate in the UK (the number of people registered to vote) was 46,500,001

England: 38,981,662 (83.832%)
Scotland: 3,987,112 (8.574%)
Wales: 2,270,272 (4.882%)
Northern Ireland: 1,260,955 (2.712%)

The total number of votes cast was

Remain – 16,141,241 (48.1%)

Leave – 17,410,742 (51.9%)

giving an overall turnout of 72.15%

There were 25,359 (0.06%) rejected ballot papers.

12,922,659 (27.79%) people did not use their vote

Further analysis of the figures shows how the individual countries voted, with England and Wales having majorities to LEAVE,  while Scotland and Northern Ireland having majorities to REMAIN

RegionResults

The actual EU Referendum results data (in CSV format) is available and provided by the Electoral Commission at

http://www.electoralcommission.org.uk/find-information-by-subject/elections-and-referendums/upcoming-elections-and-referendums/eu-referendum/electorate-and-count-information

Is the EU referendum legally binding ?

Referendums in the UK, in constitutional terms,  are not legally binding so the Government could (in theory) ignore the results although this is unlikely to happen. It is, however, necessary at some point for the UK Government  to repeal the 1972 European Communities Act, requiring a vote in parliament, in order to ultimately leave the EU.

Making up your mind

by Mick 0 Comments

Organisations and individuals for both sides of the argument appear to have been using strategies based on Fear, Uncertainty and Doubt (FUD). This makes it difficult in deciding which way to vote because it is hard to interpret the information and whether the data being presented is accurate or not.

So how can you decide? Here is a summary of some, hopefully useful, information.

The Common Market was designed to create a Free Trade area among its member states by removing trade barriers and establishing a common external trade policy with non members. The creation of a single European economic area based on a common market was the fundamental objective of the Treaty of Rome. The UK joined the Common Market (EEC) in 1973 and a referendum on membership in 1975 voted to remain as members. 1 A popular impression at the time was that the referendum was to decide whether the UK wanted to be a member of a Common Market providing Free Trade with and between other European countries.

The EEC became the European Union (EU) in a later treaty 2 which was agreed to by the UK Government and politicians at the time. There are currently 28 members states. 3

The forthcoming referendum (23 June 2016) is the first opportunity, since the referendum in 1975, for the Electorate in the UK to support continued membership of the EU or to leave the EU altogether. 4 The Labour manifesto for the 2005 election promised a referendum but never delivered. 5

The UK is one of 28 “voices” in the EU. The EU will increase in size in the future with more countries joining. While individual countries have a voice at the EU negotiating table, their influence diminishes as more countries join the EU.

The European council defines the EU’s overall political direction and priorities and sets the EU’s policy agenda. The members of the European Council are the heads of state or government of the 28 EU member states, the European Council President and the President of the European Commission.  6

The EU parliament is made up of 751 members who are directly elected by member states every 5 years using proportional representation. The number of MEPs from each country are determined by the population of that country with the UK currently having 73 MEPs (just under 10% of the total).  7

The European Commission is the EU’s executive body 8. It represents the interests of the European Union as a whole (not the interests of individual countries).

  • Propose legislation
  • Enforce European law
  • Set objectives and priorities for action
  • Manage and implement EU policies and the budget
  • Represent the Union outside Europe

A new team of 28 Commissioners (one from each EU Member State) is appointed every five years. Past members from the UK, chosen by the government of the time, include Leon Brittain, Neil Kinnock and Peter Mandelson.

The combined size of the EU gives it a major voice in the world where it represents its member countries on global issues such as

  • Climate Change
  • Energy
  • Environmental Issues
  • Terrorism
  • Migration

The EU has an interest and/or influence in many different areas affecting the UK, from Human Rights to Transport and Trade.

Areas of interest include, but are not limited to:

Agriculture, Audiovisual and media, Budget, Climate action, Competition, Consumers, Culture, Customs, Development and Cooperation, Digital economy & society, Economic and monetary affairs, Education, Employment and social affairs, Energy, Enlargement, Enterprise, Environment, EU citizenship, Food safety, Foreign and security policy, Fraud prevention, Health, Humanitarian aid and Civil Protection, Human rights, Institutional affairs, Justice and Home Affairs, Maritime affairs and fisheries, Multilingualism, Regional policy, Research and innovation, Single market, Space, Sport, Taxation, Trade, Transport

The EU Constitution guarantees the free movement of persons, goods, services and capital within the Union (the so called “four freedoms”) and strictly prohibits any discrimination on grounds of nationality.

The UK can trade freely with other members in the EU without tariffs, or other restrictions, in a combined market of more than 500 million people. The EU negotiates Trade Agreements with other countries on behalf of all member states providing a powerful worldwide negotiating position.

The EU has created a number of directives and regulations, relating to Workers’ Rights that have been enshrined in European Law, from minimum paid leave to increased pregnancy and maternity rights.

Every EU worker has certain minimum rights 9 relating to:

  • health and safety at work: general rights and obligations, workplaces, work equipment, specific risks and vulnerable workers
  • equal opportunities for women and men: equal treatment at work, pregnancy, maternity leave, parental leave
  • protection against discrimination based on sex, race, religion, age, disability and sexual orientation
  • labour law: part-time work, fixed-term contracts, working hours, employment of young people, informing and consulting employees

Citizens of Europe have the freedom to work study and travel within EU countries without restriction. Freedom of  movement across the EU opens up job opportunities for UK workers willing to travel and enables UK companies to easily employ workers from other EU countries.

Benefits (minor) arising as a result of “freedom of movement” rules include

  • The European Health Insurance Card (EHIC) 10
  • Driving licences are valid across Europe
  • Mobile phone roaming charges are being removed across the EU. 11
  • etc

they demonstrate the ability of the EU to introduce common, universal benefits  which are the same for all EU citizens.

Another side effect, from the freedom of movement rules, concerns social security payments. All countries have their own system, some more generous than others. Payments can be claimed by any EU citizen in the country where they are resident according to that countries rules not the rules of their home country. This is somewhat contentious in the UK (because of the perceived generosity of the UK ?) and possibly other countries which may have more generous payments than others.

There are also other financial differences between countries, e.g. in minimum wage payments and cost of living etc.

Could the EU impose the same minimum wage and the same social payments across all member states in the EU ? This could happen if there was closer fiscal integration between member states.

One of the fundamental principles, defined in the treaties, is the “ever closer union” of member states. The exact details of this principle are not defined but are likely to include closer fiscal and political union.

Closer fiscal integration would mean a central European authority would set spending and tax rates for all member countries.

Political union is where member countries transfer most, or all sovereignty, to a joint government which is recognised internationally and has common home and judicial policies, a common foreign policy and security policy.

One of the moves in this direction was the introduction of a common currency, the Euro, across member states. Although the UK opted out of joining the other countries using the Euro, joining the Eurozone has not been completely ruled out in the future.

The world financial problems circa 2007-2008 subsequently caused problems for a number of countries in the Eurozone, most noticeably Ireland, Greece and Portugal.  The necessary process for their recovery  was determined by the EU and austerity measures were imposed on these countries.  12

Remaining in the EU

It is unlikely that  any radical changes would be made in the short term and it is pure speculation to try and guess what would happen in the future.

So here’s my pure speculation.

There are a number of indicators of how the EU wants to proceed in the future.

In the longer term the EU is likely to want to explore the possibility of closer fiscal and political union as mentioned in the existing treaties. Whether this would mean the EU becoming the “United States of Europe” or the “Federated States of Europe” is unknown, but is a concept worth considering as a future aim.

It is difficult to know how this would affect the UK and how committed the UK would be to closer integration although a referendum vote to remain could be viewed as the UK providing their approval for the EU to continue on its way.

As the size of the EU increases, the ability of the UK to influence decisions may be diminished simply because the proportion of their voting power is reduced. It is also uncertain whether it would be necessary for majority voting to be used more often in order to get the business done, but any changes to  the voting process could require treaty change.

From a financial point of view, items such as the EU Budget rebate, currently granted to the UK, could come under closer scrutiny and be reduced or even removed completely.

A question mark remains over the ability of the EU being able to effectively handle crises which may occur. The recent, and continuing, refugee crisis highlights the dis-united nature of member states in coming up with an acceptable resolution or plan for resolution.

Another issue may be the ability of the EU to ensure mechanisms for applying sanctions, such as fines etc. to member states who fail to obey EU law. 13

Leaving the EU

If the UK were to leave the EU, the process for leaving is defined by Treaty (Article 50) and the UK should begin a period of negotiation to decide on its terms for leaving and its initial relationship with the EU post exit. 14 This allows for a maximum period of 2 years (unless extended) in which to negotiate suitable terms for separation.

Leaving the EU is likely to be a staged process and will have significant geopolitical and economic consequences trying to unravel forty years of integration in a single step. There is an interesting document, Flexcit which describes a possible multi-phase approach to exit. 15

For other aspects of leaving the EU, it is difficult to predict what would happen in the short term but uncertainty can breed fear and it is possible for some disruption in the world financial markets.

A vote to leave is likely to throw global markets into turmoil and undermine confidence in the 28-nation trading bloc.

In the currency markets, Sterling appears to weaken as polls show an increase in the support to Leave although stock markets have remained relatively calm in the run-up to the referendum

US investors may also be vulnerable to a fall-out from a vote to exit. They have increased their allocation to British equities since May of last year, according to a separate report by Nasdaq OMX Group’s advisory-services unit. Those in Britain, on the other hand, have been the biggest sellers, it showed.

The euro weakened against the dollar on concern an exit would damage trade and encourage other members to renegotiate their relationships with the EU. 16

The long term future of the EU could also be threatened following the withdrawal of the UK but while some additional member countries may decide to hold similar referendums and vote to leave, there would likely always be a core of countries remaining to carry on the European dream.

In terms of its future trading position, while difficult to predict what would happen, the UK has an impressive résumé which may help 17

  • The UK has the fifth-largest national economy (and second-largest in the EU) measured by nominal GDP.
  • The ninth-largest in the world (and second-largest in the EU) measured by purchasing power parity (PPP).
  • The UK economy currently makes up 4% of world GDP.
  • The UK has been the fastest growing economy in the G7 for four consecutive years with 2.1% year on year growth in Q1 2016.
  • In 2014 the UK was the ninth-largest exporter in the world and the fifth-largest importer,  had the second largest stock of inward foreign direct investment and the second-largest stock of outward foreign direct investment.
  • The UK is one of the world’s most globalized economies.

 


 

Notes:

  1. http://eureferendum.kf12.com/the-1975-common-market-referendum/
  2. Consolidated Version of the Treaty on European Union
  3. http://eureferendum.kf12.com/what-is-the-eu/
  4. http://eureferendum.kf12.com/eu-referendum-june-23-2016/
  5. Extract from the 2005 Labour party manifesto: The new Constitutional Treaty ensures the new Europe can work effectively, and that Britain keeps control of key national interests like foreign policy, taxation, social security and defence.The Treaty sets out what the EU can do and what it cannot. It strengthens the voice of national parliaments and governments in EU affairs. It is a good treaty for Britain and for the new Europe. We will put it to the British people in a referendum and campaign whole-heartedly for a ‘Yes’ vote to keep Britain a leading nation in Europe.
  6. http://eureferendum.kf12.com/the-european-council/
  7. http://eureferendum.kf12.com/the-european-parliament/
  8.  http://eureferendum.kf12.com/the-european-commission/ 
  9. http://eureferendum.kf12.com/workers-rights-in-the-eu/
  10. http://eureferendum.kf12.com/european-health-insurance-card-ehic/
  11. http://eureferendum.kf12.com/mobile-phone-roaming-charges/
  12. An interesting article that examines the austerity measures imposed on Ireland claims that the Irish recovery was built on human rights violations and undermined long term social and economic development. http://www.irishexaminer.com/viewpoints/analysis/irelands-austerity-success-is-no-model-for-greece-340662.html
  13. http://eureferendum.kf12.com/uk-beef-embargo/
  14. Although no other member state has left the EU, Greenland voted in a referendum in 1985 to leave the EEC, following disputes over fishing rights. Greenland was originally part of Denmark which joined the Common Market / EEC together with the UK in 1973. Greenland gained their independence from Denmark in 1979 and subsequently held a referendum on their continued membership of the EEC
  15. Flexcit – The Market solution to leaving the EU http://www.eureferendum.com/documents/flexcit.pdfThis is not to say that this process would be followed but is an example of how the exit process could be achieved.

    A possible obstacle to the exit process could be The European Communities Act 1972 legislation. This is an Act of Parliament providing for the incorporation of European Union law into the domestic law of the UK. In the event of a vote to leave, would it may be necessary to repeal the Act and would MPs vote accordingly ? 18http://www.legislation.gov.uk/ukpga/1972/68

  16. http://www.businesspost.ie/brexit-could-send-europe-shares-down-25-per-cent/
  17. https://en.wikipedia.org/wiki/Economy_of_the_United_Kingdom
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