Hard Brexit with no deal “worst possible situation” for UK, EU legal expert warns

18 Jan 17

No deal on Brexit would not be better than a bad deal, but the “worst possible situation”, an expert in European Union law has told the House of Lords sub-committee on EU financial affairs.

Maria Luisa Sanchez Barrueco, senior lecturer in EU law from Spain’s University of Deusto, was referring to warnings made in prime minister Theresa May’s much-anticipated Brexit speech yesterday.

In an address to EU leaders and diplomats, the prime minister stressed she is ready to walk away from the negotiating table if necessary, stating: “No deal for Britain is better than a bad deal for Britain.”

But Sanchez Barrueco said that, in the absence of any withdrawal agreement, the UK would come crashing out of the bloc with no framework to govern its new relationship with union and lacking the oversight to resolve disputes and enforce rulings.

The “whole legal building” would collapse in this case, she explained, including the frameworks governing the budget and the EU programmes it is spent on.

“This is not an orderly departure by any means,” she told the committee and therefore substantial negotiations must take place.

“I don’t agree with the view that no agreement [is better] than a bad agreement. No agreement is the worst possible situation; that is my view as a legal scholar.”

Sanchez Barrueco told the peers that if the UK exits the EU without a deal, she can see no legal basis requiring the it to continue paying its commitments into the EU budget beyond 2019, when the two-year negotiating period allowed for by the triggering of article 50 would come to an end.

The same is true for programmes extending beyond that date, which the UK has already committed to paying for after 2019. Legally, said Sanchez Barrueco, the UK would not be obliged to pay anything after it ceased to be a member state.

Article 50 of the Lisbon Treaty was designed to make leaving the union possible, but to discourage it, she continued. Either negotiate and reach an agreement, or enter an “absolute” legal void. After the two-year negotiating period it allows for, all treaties and membership cease to apply.

This is also represented in the fact that article 50 leaves no recourse to resolve disputes. As an EU member state, the UK resolves any disputes through the European Court of Justice. However, the ECJ does not hear cases brought by or against third countries.

Other adjudication options would be bodies like the International Court of Justice, she said. But without any powers to enforce its rulings, many countries prefer to opt for diplomacy and negotiation.

In the event that there was no Brexit deal reached and a conflict arose surrounding the UK’s payments to the EU, this would mean that the bloc would have very few options to take legal action against Britain.

This may appear like a good thing for Britain, which would apparently be able to cut ties and walk away. However, the EU would also be able to walk away from its commitments to Britain for programmes that it has pledged to deliver in the UK beyond 2019.

Similarly, the UK would have no legal avenues to take action. The government would then have to decide which EU-backed sectors or initiatives should be funded, and which would be “left out in the cold”, Sanchez Barrueco said.

She added that any future conflict over EU budget payments would have “immense political cost” and represent a “miserable loss of image” that would “hit the UK harder than the EU”.

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