Can notification under Article 50 be conditional on a “good deal”?

March 13, 2017

Posted by: Stephen Hockman QC, Christopher Badger and Stuart Jessop.

As identified in the last blog, it is potentially harmful to the EU if a Member State were able to trigger Article 50 and then change its mind again and again until the negotiations result in a “good deal”. Adopting this as a starting point strongly suggests that notification under Article 50 cannot be made in such conditional terms.

Article 50(3) provides that the Treaties shall cease to apply to a State that has given notification under Article 50 from the date of entry into force of the withdrawal agreement or, failing that, two years after notification is given. This period can be extended if the European Council, in agreement with the Member State concerned, unanimously decides to extend the period.

There are therefore three possibilities, assuming that the UK doesn’t change its mind during the two-year period:

(i) The Treaties cease to apply to the UK after the successful conclusion of a withdrawal agreement;

(ii) The Treaties cease to apply to the UK automatically at the end of two years; or

(iii) The UK, in agreement with the European Council acting unanimously, extends the two-year period.

Read literally, the UK may well end up at the mercy of the other 27 Member States, who may not agree to extend the two-year timetable. Extending this literal analysis further, if the UK wished to reject the negotiated position reached at the end of two years because it didn’t consider that the deal reached was good enough, this may not result in the opportunity to go back to the negotiating table because such an option may not have the approval of all of the other 27 Member States.

The UK would then be faced with a stark decision. It would either exit the EU with no agreement and no Treaties or it could try to change its mind about leaving at all. Subsequent ‘re-notification’ under Article 50 would be both practically and politically unthinkable – imagine the inevitable resentment that would be generated in both other Member States and the UK public.

Consequently, should the UK wish to give a conditional notification under Article 50, for example, that a final decision to leave the EU is dependent on the approval of Parliament following the successful negotiation of a “good deal”, leaving open the option of remaining in the EU in the event of a “bad deal”, the UK must escape from the literal analysis of Article 50.

The main arguments in favour of the UK being able to change its mind are set out in our previous blog. A critical question remains. Does Article 50 provide the other Member States with a power tantamount to expelling the UK from the EU if no withdrawal agreement is reached or if the UK rejects the proposed withdrawal agreement? This, after all, is the logical extension of the literal analysis.

In our view, the two most attractive arguments against such a power can be summarised as follows:

(i) Article 50(1) provides for a decision to withdraw to be made in accordance with that Member State’s constitutional requirements. Reading Article 50(3) together with 50(1), it is inconsistent with the wording of Article 50(1) (as well as the EU’s professed emphasis on democracy) to force a Member State to leave the EU where the decision to reject the withdrawal agreement on offer is as a direct result of the Member State following its own constitutional requirements (for example by consulting Parliament);

(ii) Interpreting Article 50 restrictively fails to give any regard to the potentially severe consequences of expulsion to the UK or the practical realities of a negotiating process involving a large number of differing parties with competing interests or the prospect of a change in Government or approach by the UK during the two-year process. A pragmatic interpretation would not serve to punish the UK by virtue of the fact of notification alone.

The position is far from certain and the arguments set out above are by no means overwhelming. Article 50, on its face, only allows for the three possibilities. In light of the most recent Lords amendment to the Brexit bill, this is yet another crucial issue for the Commons to consider today.

Next week Article 50 will now be triggered. What happens next?

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