Richard North, 29/06/2016  
 


Aside from the diminishing minority who are insisting that there's a way round it, we're at least reaching a stage where it's accepted that, in order to leave the EU, we will have to invoke Article 50. Much time has been wasted on this issue, but it's tine to move on.

Given that the clock starts ticking the moment the notice is sent to Brussels, though, there is a natural and sensible reluctance to invoke the Article too soon. Although, pre-referendum, Mr Cameron threatened the nuclear option, with an immediate use, wiser heads have prevailed, and he's leaving it to his successor, who will not be in place until 2 September.

However, as we see from the European Council meeting – held without the UK being represented (which probably makes it a 27-nation "summit") – leaving the notification much longer is probably not tenable.

In fact, it may not even be possible to hold off before that, as domestic as well as political pressures mount. Mr Cameron may be forced to revisit his decision, and invoke the Article earlier.

On the face of it, this could be fraught with danger. For us to run out of time and leave the EU without a settlement in place would be catastrophic. The outcome has been so well rehearsed that there should be no need for any further discussion on this. Leaving without a settlement is simply not an option.

The problem here is that the "colleagues" will be very well aware of this and, as the two-year period runs into the sand, will be able to use this as leverage, to extract negotiating concessions. Technically, this is known as "blackmail".

For this reason, we have long argued in Flexcit and elsewhere that we should conclude the negotiations within the two-year period, with that constraint shaping the entire UK approach to the exit settlement.

However, there may – and I do stress "may" - be a way out of this. It rests on the observation that, while one might expect to apply for extra time when the deadline is looming, there is nothing in the book that says this needs to be the case.

Instead, there is nothing to stop an application for extra time being the very first item in the order of business. We could, for instance, apply for a three-year extension, making five years in all – thus taking the time-limit off the agenda. We could even make the total ten years.

The crucial issues here is that the "colleagues" themselves are agitating for a speedy Article 50 negotiation. The uncertainty is as damaging to them as it is the UK – if not more so. Thus, a very brief window, we actually have some leverage.

What we do in these circumstances is make an early notification conditional on the Heads of States and Governments (HSGs), within the framework of the European Council agreeing to extend the Article 50 negotiating period.

This would then allow the preliminary discussions to be undertaken, without putting us in jeopardy, while also lifting some of the domestic pressure. And, while a period of five years is agreed, that does not necessarily mean that the full time should be used.

In this context, there is nothing in the rules either to suggest that there can't be a phased exit settlement, rather than a "big bang". It might be possible to lift or waive some of the provision of the treaties, in measured steps, rather than releasing them all in one go.

One thought in this respect is that the UK should explore the legalities of becoming a member of the EU and Efta simultaneously, as part of a transition process, with the EEA acquis being managed as if the UK is an Efta member.

And while that may not be possible – the idea of a staged withdrawal from the EU is not impossible. Something along these lines was being considered with the Spinelli-Bertelsmann "fundamental law" proposal, where the UK became an associate member, adopting only part of the overall acquis (as is already the case).

Certainly, the whole idea of a measured, phased withdrawal might do much to calm the jittery nerves of the markets, and also reassure everybody else that nothing sudden is going to happen. Dealing with change at a pace that everybody can cope with seems to make much more sense.

Given that there is political will, much can be achieved, without the Sword of Damocles, in the form of the two-year time limit, hanging over us.






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