Article 50 Triggered: The Two Year Countdown

“I hereby notify the European Council in accordance with Article 50(2) of the Treaty on European Union of the United Kingdom’s intention to withdraw from the European Union” – Theresa May in UK’s letter triggering Article 50.

On March 29th, 2017, Theresa May, the UK’s Prime Minister, triggered Article 50 and formally began the process of withdrawing UK from the European Union (EU). In her letter to the European Council President Donald Tusk, Mrs. May outlined UK’s views on some of the aspects of the withdrawal. One of the significant points was that the future trade talks should be held concurrently as the agreements on which the UK should leave the EU. As a response, the European leaders formally rejected the demand on the next day, and on March 31st, 2017, the EU presented its draft guidelines on how the negotiations will unfold.

About nine months ago, on 23rd June 2016, the results of the referendum on whether UK should remain or leave the EU showed that the public wanted independence. With a turnout of 71.8%, 51.9% wanted to leave and 48.1% wanted to remain. More specifically, England and Wales voted for Leave whereas Scotland and Northern Ireland voted for Remain. Nonetheless, despite the division, the country as a whole was skewed towards ending the 44-year relationship with the EU.

Currently, including the UK, there are 28 countries in the EU. The political and economic union: member countries enjoy the benefits of a single market where there is a free movement of goods and people while having to uphold the EU law above the national law.

No country has ever left the EU before the UK. There are no guidelines to follow, no examples to learn from. It poses huge uncertainties and the clock is ticking: the UK and the EU have only 2 years to reach an agreement unless all the remaining EU members agree universally that the term should be extended.

Under such circumstances, the two parties – the UK and the EU – need to reach an agreement on a “divorce” bill, a transitional arrangement and the long-term UK-EU relationship. In terms of the bill, European Commission hopes that the UK pays a sum of 60 billion euros for the disengagement according to the Financial Times. Moreover, the Great Repeal Bill has been introduced to make the transition of UK withdrawal smoother. While repealing the European Communities Act 1972 which mandated EU law to be upheld before the UK law, the EU laws will be integrated into the UK. Once incorporated, they will be edited to make them more prevalent for the country. The last big question is the long-term relationship between the two parties, primarily in terms of trade and people movement.

Currently, the EU has rejected UK’s desire to hold concurrent talks on the “divorce” bill and the future trade relationship. It has declared that it will take a phased approach, dealing first with the bill before any talks on trade will be considered. It has also stated that the UK cannot negotiate with individual member states and that it will not give UK rights to the single market as the other EU members.

UK is in a very delicate and complex situation where it has to disentangle itself politically and economically while understanding its own interests and those of the EU. Brexit has given a huge financial burden to the UK in terms of the weakened pound, uncertainties of the market and now the “divorce” bill. The future seems even more uncertain. How will the UK solve the problems outlined above? We only know that the clock is ticking.