The Cicero Brexit Insights team is producing regular updates, comment and insight on both the broad themes and the technical detail of Brexit. We aim to give readers a clear view of the issues and challenges as they are seen in Brussels, London and Member States. This week the UK team looks at the second reading of the EU (Withdrawal) Bill and the EU team analyses European Commission President Jean-Claude Juncker’s State of the European Union address.

The European Union (Withdrawal) Bill has overcome its first hurdle in the Commons, passing its second reading in the early hours of Tuesday morning by 326 votes to 290 – a majority of 36. Those voting in favour of the Bill included the 10 DUP MPs and 7 Labour MPs who voted against their whip. While there had been increasing speculation that centrist Conservative MPs may rebel and vote against the Bill, this was not the case at second reading, with only 3 abstaining – 2 because they were not present.
However, Committee stage may be a very different story. Both Dominic Grieve and Anna Soubry have put their name to cross-party amendments, backed by other Conservative MPs including Ken Clarke and Nicky Morgan. With 157 amendments already tabled, the eight days scheduled for Committee stage will see lengthy debate on issues including the Government’s proposed use of delegated powers, Parliament’s involvement and say on the final deal and the length and scope of a transitional deal, the size of the ‘divorce’ bill and protection of citizen’s rights.

Outside of Parliament, the need for a transitional arrangement appears to have been broadly agreed by the Cabinet but the debate on what format this would take rages on. Giving evidence to the Lords Economic Affairs Committee this week, Chancellor Philip Hammond commented that the Government will look to strike a transitional arrangement that is “a lot like the status quo”. Under this plan, the UK would legally leave the Single Market and Customs Union in order to be able to negotiate new trade deals in this period, but would essentially be aiming to remain in these in all but name. This would be a welcome move for the business community, but with the clock ticking and no signs of progression to phase two of negotiations, the ability to negotiate such a transitional arrangement with enough warning is starting to look questionable.

Charlotte Adamson
Senior Account Executive

 

The postponement of the next round of UK-EU negotiations and Commission President Juncker’s State of the European Union (SOTEU) address before the European Parliament this week provided some welcome respite for Brexit-weary EU leaders and officials.

Juncker’s bold and ambitious speech laying out his vision for the future of the Union made it clear the EU was ready to move on from Brexit. While he expressed sadness at the UK’s decision, Juncker made only a single reference to Brexit, which he described “as not the future of the EU”. Even the verbal matches with Nigel Farage which marked previous SOTEUs were reduced to a quick jibe at the former UKIP leader who was told he may live to regret the decision. In another symbolic move, the Commission President suggested that the Council hold an extraordinary summit on the day of the UK’s withdrawal from the EU to vote on the plans for institutional reform.

While Juncker made several ambitious proposals for institutional reform, including a merger of the Commission and Council Presidents, they were laid out as part of his own vision for the EU. Given the reaction from several Members States (e.g. the Netherlands and Denmark), it is unlikely the Council will move forward on the more radical proposals in the short to medium term. Nevertheless, there is appetite for moderate institutional reform amongst Member States and a perception that economic recovery and recent electoral defeats for populist parties offer the opportunity to do so.

Meanwhile, the European Parliament’s Brexit coordinator Guy Verhofstadt welcomed UK Prime Minister Theresa May’s confirmation that she would address the Conference of Presidents in the Parliament. With Parliament’s approval needed on the final outcome of negotiations, May will need to show consideration for MEPs’ concerns over EU citizens’ rights, the Irish border question and the financial settlement. The European Parliament will debate a new resolution on 3rd October which will tackle the issue of progress in negotiations and moving to the second phase.

With the EU demonstrating its readiness and desire to move on from Brexit, the hope in Brussels is that Theresa May’s planned announcement in Florence next Friday will provide enough for a breakthrough in negotiations.

Robert Langmuir
Senior Account Executive

 

To sign up for updates from Cicero Brexit Insights, or to arrange to speak to the team, please email register@cicero-group.com.