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31.01.2018

Brexit: EU publishes guidelines on transition period

In essence, the EU's new offer to Britain is to split Brexit into a "political part" - as planned on 29 March 2019 - and an "economic part" on 31 December 2020. In between, a transitional phase with continued validity of all EU law (including the internal market and customs union) under the supervision of the European Court of Justice is planned.

The timing for the political Brexit in March 2019 makes sense from the EU's point of view, as this will avoid Britain's participation in the next European elections (May 2019) and in the renewal of the EU Commission (November 2019).

The timing of the economic Brexit at the end of December 2020 also makes sense from the EU's point of view, as the EU's "multi-year financial framework" would then end and no ongoing programmes would have to be interrupted.

From the UK's point of view, there will be a full payment obligation to the EU in the transition phase, with the simultaneous loss of all political rights of codetermination. This "colonial status" of Great Britain in the transition phase is, however, considered unacceptable by many in the UK.

An undeniable advantage of a transitional phase for both sides would be that the so-called "cliff edge" scenario would be avoided. This would mean that full customs formalities and the loss of all other benefits of the internal market would not yet be in place. The period for negotiations on future relations would also increase from the current one year to just under three years, which would be the minimum time required for a detailed free trade agreement.

But nothing has yet been decided. The EU is currently offering a negotiating horizon for the agreement of a transitional phase in October 2018, in order to achieve ratification by all national parliaments of the EU27 before the UK officially withdraws. In short: within 9 months at the latest, at least the exit modalities and the conditions of the transition phase must be agreed upon.

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