Tensions rise as October deadline looms

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In March of this year, the European Council agreed to the UK Government’s request for a transition period that would apply from the date the UK leaves the EU (29 March 2019) until the end of 2020. Following that last summit, senior figures in the EU and the 27 remaining member states repeatedly stated that significant progress on the remaining withdrawal issues would be needed by June’s European Council to ensure that negotiations remain on track.

The intervening months saw much drama play out domestically in the UK as the EU Withdrawal Bill made its way, slowly and dramatically, through Parliament. However, in Brussels, officials grew frustrated with the lack of progress made by in talks between the Commission and the UK. By mid-June, little to no headway had been made between the two parties on the thorny subjects of the so-called Northern Irish “backstop” and the governance mechanisms that would be employed with regard to the Withdrawal Agreement.

As a result, this week’s European Council meeting brought little in the way of good news for those keenly interested in Brexit. Instead, the EU27 was to sound the alarm at the lack of progress to date while underlining the fact that the Government’s hard-won transition period is at stake unless an agreement is reached by October 2018. The draft Council conclusions also urged “member states and all stakeholders to step up their work on preparedness at all levels for all outcomes”, in light of the increased likelihood that a ‘no deal’ scenario comes to pass.

Although some accused the EU of having set an artificial deadline for progress this June, the final text of the Withdrawal Agreement and the text of the political declaration on the future relationship must be agreed by October in order to ensure that the member states and the European Parliament have time to ratify both agreements. The worry in Brussels is that, with less than four months to go, the UK has not yet clarified its approach to the future relationship, meaning that talks have barely begun on this topic.

The escalation of language used at this June’s Council should therefore be seen as a warning to the UK and to all stakeholders that unless progress on both strands is made quickly and efficiently this summer, the likelihood of the UK crashing out of the EU with no deal in March 2019 will have increased. For its part, the European Commission’s Brexit preparedness team has started planning to that effect, warning governments and businesses in sector specific papers of the steps that they will need to take action to reduce their liability as that deadline approaches. All signs point to a very testing and difficult few months of Brexit negotiations for all involved as the stakes are raised on both sides of the Channel.

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