Thread by @Usherwood

Some thoughts on the duration of transition

1/

It is generally agreed that there will be a gap between the UK leaving the EU and the coming-into-force of a new relationship.

I'll call this the 'transition' period despite all the issues that come w that label

2/

During this time, the EU and UK will negotiate the new relationship, on the same legal basis as any other third-state agreement the EU runs

3/

That means no 'trade talks' prior to March 2019, despite what many think will happen

4/

(Phase 2 of Art.50 is about setting up the structures for that post-membership negotiation, and the arrangements for the transition)

5/

At some other point in time, I'll write about the content of transition, but for now let's just focus on how long it'll last

6/

UK has always been keen on it being shorter and well-defined: helps w selling 'we've actually left the EU' and w economic transition planning

7/

Until last month, EU was much more open. Focus was on Phase 1

8/

But Dec #EUCO and (especially) today's COM draft mandate now point to EU pushing for v.short transition period

9/

COM recommends end 2020, to fit with current financial cycle. Basically, push Brexit timeline into EU timeline, so less hassle

10/

Several issues arise.

1) Given lack of clarity (on either side) about new relationship, no sense of financial obligations post-2020

11/

If we assume UK follows NOR model, then monies post-2020 will be hived off into a separate fund, so impact on 2020-7 finances is manageable in any case

12/

2) March 19 to Dec 20 is 21 months, in which aim is to negotiate a big FTA, and ratify it

13/

That looks heartily ambitious, given FTAs often take more like 4-5yrs to negotiate, then 1yr to ratify (and this wld be a mixed agt, so unanimity prevails)

14/

Even if you take +ve view (starting pt is convergence, so avoid many difficult debates), still lack clear preferred outcomes on either side

15/

3) And that takes us to Q of what happens if 21mths isn't enough.

16/

Much talk from EU27 that this wouldn't be extendable, ie a one-shot period.

But what if new relationship negotiations haven't got through all the detail come Dec 20?

17/

No clarity on whether EU prefers to let it all collapse (a delayed no-deal scenario), or to extend (against its stated preferences), or something else

18/

Logically, extension is only sensible path, so why try to close it down now?

19/

Three ideas to play with.

- EU is trying to help UK, by being tough, then 'conceding' more time
- EU just wants Brexit off the books ASAP
- EU thinks Jt Rpt on Phase I locks UK into EEA-style alignment, so no downside risk

20/

None of those look very sensible logics.

Next weeks will reveal more, but expect this to become much more of an issue during the Spring.

/end