BrExit - UK leaving the EU


3. The Treaties shall cease to apply to the State in question from the date of entry into force of the withdrawal agreement or, failing that, two years after the notification referred to in paragraph 2, unless the European Council, in agreement with the Member State concerned, unanimously decides to extend this period.
I was a reluctant remainer believing that on balance we are just about better off in than out. Despite this I wasn't that concerned when the referendum went the other way.

Initially I was optimistic that both sides would want a deal and as the situation was unexpected both sides would be open to the necessary compromises.

Now I am tending towards no deal and the UK dropping out simply because no agreement will have been made by 29 March 2019 and there being no desire to extend the negotiation process.
Nobody expected the UK to vote to leave, at the time it was unthinkable.

By taking 9 months to trigger Article 50 the UK Government gave the rest of the EU time to get used to the idea.....

.... and the departure of the UK is not seen as being so bad after all.

BrExit 7 January 2018

Well we seem to have made "significant progress" and the talks can move on to trade terms.

But what has been agreed?

Citizenship was never really going to be an issue as there was too much agreement at the start of the process. The option for British courts to refer cases back to ECJ is fudge that suits both sides.

It seems that the Northern Ireland border issue has been deferred with some words that don't seem to mean much.

The exit bill seems to be mostly on the EU's terms rather than the UKs.
So of the two big issues, one has been deferred and the EU won the other.

The UK is talking tough on Financial Services needing to be in any trade deal and the EU is saying no.

Whether the financial settlement is the Quid Pro Quo for this we don't yet know.

Without Financial Services being included I really can't see how Parliament could vote a trade deal through.

BrExit 17 July 2017

How would most people in the UK react if it were Italy leaving rather than the UK? Mostly with indifference I suspect.

The event is far more significant for the UK than it is for other member states so it is easy to see how they can be getting bored with it.

This boredom may make some countries unwilling to extend the exit period and unless Italy, France and Germany wanted to extend and could use their influence Article 50's requirement for a unanimous vote to extend the departure period could see the UK out after the two years.

At present it is unclear how much of the current UK contribution the EU will insist is a firm commitment and is part of the exit agreement. This alone could stall talks for long enough that we hit the two year deadline.

Meanwhile BMW, Mercedes and Audi may be thinking if there are going to be WTO 10% tariffs so be it. With so many of these cars now being sold on finance contracts often without an ownership option a bit a price increase can easily be hidden.

Others have also had time to see how they could trade with a UK outside of the EU and I suspect that pressure on EU governments from EU businesses is reducing.

Only if we got to the stage of there being an UK exit and no travel agreements existing between the EU and the UK would I expect that a special agreement would be made outside of the main negotiating thread. Hopefully this would include some arrangement covering air travel as well.

By being clear on Hard BrExit a deal seemed achievable as agreement to leave The Single Market and Customs Union doesn't through up challenges to the core EU beliefs, just procedural issues.

Unfortunately in the UK delusion is starting to set in, Tony Blair's suggestions that Free Movement of Labour may be negotiable is a great example, Diane Abbot is talking about remaining as a full member of the Single Market.

IF we are not careful we may get to the stage where individual businesses are "accidentally" closed down. I can see this as many industries have regulators who have little or no discretion in certain areas.

For example banking regulators can't allow unregulated banks to operate just because they used to operate under an EU issued licence and the regulator trusts them. The regulators will know if and when various banks lose their authority to operate and would have no choice but to close them down.

They can't say, "ah but they will have authority again in a couple of months after..."
So which businesses are going to be affected and by how much.

Most businesses that could, created plans for a new order where the UK is clearly out of the EU.

For example it is not that hard conceptually for a UK airline with a European operation to create a new airline within the EU which becomes an EU regulated airline.

Clearly it is harder for other businesses such as car makers who are much less discrete, sourcing components from both the UK and other EU countries.

It is already becoming clear that some companies that are likely to be heavily affected have not only created plans for an EU based business but are also implementing them.

Such as EasyJet converting a lot of its European operation to an airline that will be regulated in Austria, IGG reporting that they are in advanced stages of approval for an EU operation.

If these are simply some of the first which seems likely then by the time of the UK departure it will be a non event like the Year 2000 computer meltdown.

The Y2K problem was a non issue because there was enough time and publicity to ensure that the appropriate action was taken.

We are not hearing stories of regulators in EU countries attempting to deny UK based business approval unreasonably. It would be surprising if this were to happen as they will almost certainly be regulating many businesses with non EU ultimate owners already.

My suspicion is that there will be a handful of big losers and these will be found amongst FTSE 250 and All Share companies. They will be the ones that need both UK and EU operations but don't have enough capital to finance this or enough customers to be able to afford to do this profitably.

They will have to decide if they want to operate in the UK or the EU.