EU withdrawal trade talks “could exceed two years”

29 Feb 16

The UK may be unable to reach a trade deal with the European Union within the two-year timeframe to be triggered following a leave vote in the referendum on June 23.

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In a paper setting out the likely process by which the UK would leave the union, the Cabinet Office said exit would follow the rules set out in Article 50 of the 2007 Treaty on European Union.

Prime minister David Cameron said that if the British people vote to leave, they would expect the process to start straight away.
Article 50 is intended to allow for a deal on the terms of withdrawal, such as any continued access to the EU’s internal market and the withdrawal of structural funds, to be agreed. This would make it difficult to meet in two years before the formal exit from the economic bloc, according to today’s document from the Cabinet Office.

The result could be up to a decade or more of uncertainty, it stated.

“The complexity of the negotiations, and the need for the UK to negotiate adequate access to the single market after it leaves the EU, would make it difficult to complete a successful negotiation before the two year deadline expired. Any extension to the two-year period set out in the Treaty would require the agreement of all 27 remaining EU member states.

“If the UK was to reach the end of the two-year period specified by Article 50 without having reached an agreement, and if any of the 27 other member states vetoed an extension of this period, this would lead to the UK leaving the EU with no immediate replacement agreed, without any protection under EU law for the rights of UK business to trade on a preferential basis with Europe or the EU’s free trade agreement partners, UK citizens to live and work in Europe, or UK travellers to move about freely in Europe.”
Responding to the report, Vote Leave, one of the groups vying to be the designated group campaigning for an out vote, said the document was not credible.

Chief executive Matthew Elliott said it contained errors and incorrect assumptions. Challenging the prime minister’s stance, he said there was no legal obligation in the European Union Referendum Act 2015 to trigger Article 50 immediately.

“When we Vote Leave we will negotiate a new UK-EU deal based on free trade and friendly co-operation, but not the supremacy of EU law, and we’ll spend our money on our priorities,” Elliott said.

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