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After Prime Minister Theresa May triggers the formal process for leaving the EU, which she intends to do by the end of March, her team will be free to start trade talks around the world, a senior official said, speaking anonymously about the confidential plans.
The move would directly contradict senior EU politicians, who say Britain cannot legally begin negotiations on trade deals with countries outside Europe until it has left the bloc. Despite this, officials in May’s team believe the EU will have no authority to stop the U.K. once the Brexit process has started, and little political appetite for a fight on this issue. [...]
The U.K. government’s private legal advice states that no trade agreements can be signed while the country remains a member of the EU and no negotiations should begin before May formally starts the process of leaving by triggering Article 50 of the Lisbon Treaty, the senior official said. May has promised to invoke Article 50 by the end of March.
After this point, with the U.K. firmly on the legal path out of the EU, May’s team will have to act in the best interests of the country to secure new trade partners around the world, whatever the sensitivities in Brussels, the official said. Such a stance, if it translated into action, would risk inflaming relations with the EU at the moment when the U.K. is seeking to negotiate good exit terms and a favorable new trade deal with the bloc.
Souring Relations
On Monday, the European Commission underlined its warning that the U.K. will not be allowed to do more than discuss trade in broad terms with countries outside the EU until it has left the union.
“There’s nothing in the treaties that prohibits you from discussing trade,” European Commission spokesman Margaritis Schinas told reporters in Brussels, but he added that countries can’t hold official negotiations on formal trade agreements while still members of the EU.
“EU rules mean the U.K. cannot legally begin negotiating a trade deal with the US before the U.K. leaves the EU,” said Gregor Irwin, chief economist at Global Counsel in London. Defying the EU would risk “further souring the relationship with Brussels just as the Brexit negotiations are starting,” he said.
Ambassador and Permanent Representative to the UN Julian Braithwaite: Ensuring a smooth transition in the WTO as we leave the EU
British ministers in fact took the decision to begin our WTO transition late last autumn. They concluded that establishing the UK’s independent position in the WTO would not prejudge what kind of relationship the UK and the EU would have in future. Nor would it prejudge when the UK would leave the EU. The timing of the transition in the WTO would be linked to whatever the UK and the EU agreed in the Article 50 negotiations. This WTO process was not an alternative to a negotiated exit from the EU, as some claimed. On the contrary, it was a necessary complement to it.
Given that was the case, ministers decided it was better for the UK to get on with it, and with reassuring our trading partners around the world that their trade will not be disrupted. The Secretary of State for International Trade duly notified Parliament in a Written Ministerial Statement on 5 December 2016. [...]
Smoothly separating the UK from the EU schedules is the best way we can reassure our WTO partners that their trade with us will not be disrupted as we leave the EU. Once we have our own schedules in the WTO, the UK will be able to negotiate changes to the international trading system as well, whether multilaterally (with the whole membership of the WTO) or plurilaterally (with some of it). A country’s WTO schedules also provide the baseline for negotiating bilateral Free Trade Agreements.
There is a process in the WTO that allows the UK to submit new schedules. But they can only be adopted – or certified – and thus replace our existing EU schedules if none of the WTO’s other 163 members object to them. So to minimise any grounds for objection, we plan to replicate our existing trade regime as far as possible in our new schedules. Before we take any formal steps in the WTO we will hold extensive informal consultations with the WTO membership. Every member will have an opportunity to raise any issues or concerns with us before we proceed.
We intend to work closely with the EU during this process. In the meantime the UK’s WTO commitments will remain as they are, as set out in the schedules with share with the other EU Member States. While the UK remains a member of the EU we will continue to respect and uphold the EU’s arrangements in the WTO.
Replicating our current EU trade regime will help ensure that our transition in the WTO is as simple, technical and uncontroversial as possible. It by no means precludes the UK from taking control of its trade regime after we leave the EU, and shaping it in the interests of the British economy and the global trading system. Indeed, it is a necessary precondition for doing just that. [...]
Full blog post on the Foreign & Commonwealth Office website