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For Britain ‘soft Brexit’ is the worst of all worlds

The proposal Britain should adopt a 'soft Brexit' would leave Britain an economic vassal of the EU exactly analogous to Ukraine. In reality it is desired neither by the EU nor the leaderships of the two major parties in Britain. The only issue is to negotiate the transitional arrangements leading to 'hard Brexit'.

One inevitable consequence of the British general election is that the unexpectedly strong showing of Jeremy Corbyn’s Labour Party has brought encouragement to those in Britain who claim to want ‘soft Brexit’ but who in reality want no Brexit at all.

To be clear, there is no possibility of Brexit not happening.  I have already explained that the leaderships of both the Conservative and Labour Parties are now fully committed to Brexit, and that Labour’s unexpectedly strong showing in the election was partly due to Jeremy Corbyn’s success in persuading pro-Brexit Labour voting working class voters that the cause of Brexit is safe with him.  By contrast the two parties that continue to support the EU – the Liberal Democrats and the SNP – both lost votes.

It is also fair to point out that Jeremy Corbyn has a much longer history of criticism and opposition to the EU than Theresa May – even though both voted Remain in the Brexit referendum – and that the Brexit Labour advocated during the election in its manifesto is essentially as ‘hard’ as the one advocated by Theresa May.

As to what a ‘hard Brexit’ means, the short answer is that it means Britain’s complete exit from the EU’s institutions, including the Single European Market, which in turn means that Britain would no longer be subject to the body of EU law – the so-called acquis – which is regulated by the European Court of Justice.

That is the only Brexit that makes sense, and irrespective of whether or not Jeremy Corbyn eventually becomes Prime Minister it is the only Brexit that can happen.

To explain let me refer to an article I wrote two years on the subject of the association agreement between the EU and Ukraine.  Here is what I said about it

Most people believe the [association] agreement is intended to create a free trade area between the EU and Ukraine.

It is easy to understand why people think this since that is what the Association Agreement itself says in Article 25:

“The Parties shall progressively establish a free trade area over a transitional period of maximum 10 years starting from the entry into force of this Agreement, in accordance with the provisions of this Agreement and in conformity with Article XXIV of the General Agreement on Tariffs and Trade 1994 (hereinafter referred to as ‘GATT 1994’).”

Establishing “a free trade area” (in the commonly-understood meaning of that term) between the EU and Ukraine is not however what the Association Agreement actually does.

At almost a thousand pages, the text of the Association Agreement is extremely long and uses convoluted and technical language.

This is intentional. The text has been deliberately made much longer and far more technical than it needs to be, precisely so as to confuse people.

It is certainly far longer and much more complex and technical than it would need to be if its purpose really was merely to create a free trade area. Here by comparison is the text of the EU Association Agreement with Chile. This too purports to be a free trade agreement between the EU and Chile.

Reading the two documents side by side, the similarities are obvious; but so are the differences. The Association Agreement with Ukraine is much longer and far more technical and complex.

What the EU officials who drew up the document have done is take a standard form of the Association Agreement the EU routinely uses when it negotiates free trade agreements with non-EU countries and graft onto it something completely different.

So what does the Ukraine EU Association Agreement actually do?

What it does is require Ukraine to adopt the whole body of EU law as it affects regulation of its economy.

EU officials call this body of EU law the acquis. Those with the time and inclination to read through the document will see this word appears constantly throughout the text.

The key omnibus provision is Article 56, in the section that deals with removing “technical barriers to trade”:

“2. With a view to reaching these objectives, Ukraine shall, in line with the timetable in Annex III [to this Agreement]: (i) incorporate the relevant EU acquis into the legislation of Ukraine.”

Since Ukraine is committing itself to make the acquis its law, it is surrendering regulation of its economy to the EU in Brussels. Questions of regulation of Ukraine’s economy will no longer be decided by the Ukrainian government and parliament in Kiev, but by the European Council and the EU Commission in Brussels.

Moreover what the EU decides will have the force of law. This is made quite clear by the single most important paragraph in the entire document (buried on page 187):

 “Article 322

Dispute settlement relating to regulatory approximation

The procedures set out in this Article shall apply to disputes relating to the interpretation and application of obligations contained in relating to regulatory or legislative approximation contained in Chapter 3 (Technical Barriers to Trade), Chapter 4 ( Sanitary and Phytosanitary Measures), Chapter 6 (Services, Establishment and Electronic Commerce) and Chapter 8 (Public Procurement) [of this Agreement].

Where a dispute raises a question of interpretation of an act of the institutions of the European Union, the arbitration tribunal shall not decide the question, but request the Court of Justice of the European Union to give a ruling on the question. In such cases, the deadlines applying to the rulings of the arbitration panel shall be suspended until the Court of Justice of the European Union has given its ruling. The ruling of the Court of Justice of the European Union shall be binding on the arbitration tribunal.”

Since the entire point of the Association Agreement is “regulatory or legislative approximation” through wholesale adoption of the acquis in the key economic areas mentioned in Article 322, what this paragraph does is give the EU effective control of Ukraine’s economy, with the EU’s decisions having the force of law, with the right of enforcement given not to Ukraine’s own courts, but to the European Court of Justice in Luxembourg.

To hide away this provision the Association Agreement creates an elaborate arbitration system to settle disputes. However, since in deciding legal questions the arbitration tribunal is bound by decisions of the European Court of Justice, the final decision always ultimately rests with the EU.

Other sections of the Association Agreement are equally far reaching, with Ukraine for example required to harmonize its foreign, defense, tax and transport policies with those of the EU, to base its intellectual property law on that of the EU, and even to allow unrestricted access to EU investigators undertaking “anti-corruption” investigations in Ukraine.

The Association Agreement does not therefore just create a free trade area.  What it does – and what it is intended to do – is make Ukraine in effect a part of the European Economic Area and of the European Single Market administered by the EU Commission in Brussels.

It does so despite Ukraine remaining outside the EU. Ukraine is surrendering control of its economy to the EU without the corresponding benefit of EU membership.

Many people within the EU today complain about the power the democratically-unaccountable institutions of the EU have over their lives. They are however at least represented in the EU through their governments and can vote in elections to the European parliament. Ukraine’s people will have no representation at all, and no say through their government in what the EU decides for them.

(bold italics added)

‘Soft Brexit’ is Ukraine’s EU association agreement applied to Britain.  Just as by committing itself to the association agreement Ukraine has over control of its economy to the EU without the corresponding benefits of EU membership, so ‘soft Brexit’ would hand over control of Britain’s economy to the EU without the corresponding benefit for Britain of EU membership.

Just as the EU institutions (the European Council, the Council of Ministers and the EU Commission) are entitled by Ukraine’s association agreement to regulate the entire working of Ukraine’s economy, so if Britain went for a ‘soft Brexit’ they would be entitled to regulate the entire working of Britain’s economy.

Since Ukraine is not a member of the EU, and since Britain will cease to be a member of the EU in two years time, Ukraine and Britain will have no say in either case, and decisions of the European Court of Justice on law they have no part in making will be binding on both.

If the association agreement has robbed Ukraine of its economic independence, turning it into an economic satellite and vassal state of the EU, so the ‘soft Brexit’ some support would do exactly the same for Britain.

I cannot see any possible merit in this.  ‘Soft Brexit’ would simply make Britain even more subordinate to the EU than it is already, whilst depriving it of such say in EU decision as it currently has as an EU member state.

I cannot see how this is remotely consistent with the clear and unambiguous decision to leave the EU taken by the British people in the Brexit referendum last year, and I am sure that many of those who campaign for a ‘soft Brexit’ know it.

Their agenda is to create an unsatisfactory half-way house, which they hope to leverage to bring Britain eventually back into the EU when the current anti-EU mood – as they hope – has subsided.

In reality precisely because ‘soft Brexit’ is so unsatisfactory it isn’t going to happen.  Neither the Conservative nor the Labour leaderships support it, and in Jeremy Corbyn’s case he unquestionably knows that the strongly social democratic manifesto he put to the British people in the election cannot be implemented if Britain goes for a ‘soft Brexit’ because key provisions of that manifesto – such as the re-nationalisation of the  railway system – are incompatible with EU law.

Moreover – a point that is repeatedly overlooked – it is doubtful that a ‘soft Brexit’ is what the EU wants either.  A good explanation of why has been provided in the Financial Times by the columnist Wolfgang Münchau who has also explained why for procedural reasons Brexit is now essentially irreversible

Brexit, hard or soft, is not the UK’s decision alone. It is not even primarily the UK’s decision. The second is that the Brexit process is driven by the legal procedures of the EU, not whether commentators think a UK prime minister has a mandate or not. And finally, from a European perspective, it does not matter whether the UK has a minority government, a coalition or a governing party with a 100-seat majority. Angela Merkel, the German chancellor, never achieved a result as good as Mrs May did last week.

Both are improbable. But even then, the reversal of Article 50 would not happen automatically. It may not even be legally possible.

Even in the unlikely case that the European Court of Justice were to give an opinion on this issue, the final decision does not lie with the British parliament, but with the European Council, which is guided by its own self-interest.

If Brexit cannot technically be reversed, can it be materially altered or softened?

I do not see how this is possible, either, except through a longer transition period. Mrs May’s letter triggering Article 50 laid down two clear conditions: no membership of the customs union and no membership of the single market.

What very few Remainers in the UK seem to realise is that the EU favours a Brexit with no single market and customs union membership, because it makes a difficult negotiating process easier. The degrees of hardness and softness are not unilateral choices to be taken by the UK electorate.

(bold italics added)

As Wolfgang Münchau says, the real issue is not whether there will be a ‘soft Brexit’ or a ‘hard Brexit’ – the only possible outcome is a ‘hard Brexit’ whoever Britain’s Prime Minister is – but negotiating the transitional arrangements needed to achieve it.

Negotiating those transitional arrangements and agreeing how long they will last is a colossal and massively complex undertaking, all the more so as it must be done in parallel with the equally massive task of preparing for life Britain outside the EU.

The expertise to do all this exists in Britain, but it will require the widest possible degree of consultation and openness to work out an effective strategy.  Theresa May’s preposterous proposal to EU Commission President Juncker to conduct the whole Brexit negotiation in secret is the diametric opposite of what the situation requires.  If she now leaves office, making it possible for someone more attune with the realities of the situation to take over, then the election Britain has just had may turn out to be Britain’s deliverance.

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Alexander Mercouris
Editor-in-Chief atThe Duran.

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