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After a rollercoaster period filled with debate, deliberation and even the intervention of the Supreme Court, the government has today formally commenced the UK’s exit from the EU with the triggering of Article 50.
Today’s notification has been a formality since the Article 50 Bill received Royal Assent earlier this month, and the Prime Minister’s statement to parliament along with her letter to the President of the EU Council, Donald Tusk, provided little new information.
Building upon the twelve negotiating priorities laid out in her speech at Lancaster House, the Prime Minister’s statement set out that the UK is optimistic about the task ahead. In her letter, Mrs May emphasised the need to look forward and “believe in Britain” while remaining conciliatory towards the EU in an effort to agree a “deep and special partnership”. Whether her sense of optimism and hope is matched by our European negotiating counterparts remains to be seen.
Mrs May was pointed in saying that she believes it is necessary to agree the terms of the UK’s future partnership contemporaneously with those of its withdrawal from the EU. However, this has been an area of contention with Brussels and there is little indication they would show a willingness to concede on such a point of principle. The Prime Minister also reiterated her belief that a final deal can be achieved within two years, and that she wants to see an implementation period agreed early on in the process. To this end, her recognition of the need for certainty for businesses is to be welcomed.
While cautiously optimistic throughout, the letter was built on the undertone of a threat – that future security cooperation between the UK and EU is dependent on a good economic deal. It was a timely reminder that an intense negotiation is about to begin, with horse-trading expected from both sides.
What happens next?
Since the referendum, and in the month preceding the triggering of Article 50, much of the political focus in the UK had been concentrated on our own negotiation objectives. The triggering of Article 50 now requires a shift of attention to across the channel, with the EU institutions and interlocutors now formally brought into the Brexit process. Whereas government ministers have consistently expressed optimism around negotiating a free trade deal and “having our cake and eating it”, the kick-starting of the negotiation process may prove sobering, as the EU team attempts to pursue its own agenda.
The EU’s Chief Brexit Negotiator, Michel Barnier, has already set out a clear timetable for EU action over the next month. However, with the French Presidential elections expected to roll-on until the middle of May, the real negotiations won’t properly commence until the early summer. We have produced a timeline below of the key dates to look out for and what to expect over the coming months.
As part of the work Kennedys is doing to support the insurance sector, we also intend to revisit our Brexit report. It will explore how key stakeholders in the industry have managed the uncertainty over the past 12 months and provide a sense of the sector’s confidence as we move into the next phase of the Brexit process. We will focus our work around the first anniversary of the referendum towards the end of June 2017. More details on this report will be published shortly.
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United Kingdom