October 29, 2018
Why the EEA is no longer a Brexit option
Brexit almost entirely disappeared from the news agenda in the UK over the last few days, which would have been a relief if Brexit had not been superseded by other awful news. There was one Brexit story that caught our eye, not so much for what it says, but as an example of how uninformed the debate still is. This story concerns a Brexit plan B to introduce a temporary EEA membership in lieu of the transition period. Various senior Tory politicians are quoted as finding the idea brilliant.
Unfortunately, the proposal is technically and legally not feasible. We have also advocated the EEA as a potential Brexit option in the past. But the EEA is no instant panacea. As Jean-Claude Piris pointed out in a series of tweets, full EEA membership requires a series of treaties, including the UK joining Efta. These treaties are not off-the-shelf, they require technical negotiations and ratification by all members. This cannot be done by March 29, 2019. Piris doubts that EEA members would accept the principle of a temporary membership. That assertion would need to be tested, though. We find it hard to see why EEA members should want to block this, but we agree with him that their assent cannot be taken for granted either. Thus a Brexit transition period is necessary. And Piris also points out that the EEA is not a customs union. Worse, it is incompatible with a customs union as Art 56(3) of the Efta Convention binds members to accept FTAs concluded by Efta members. This means that the cliff edge would still occur, and that the EEA does not solve the Irish border issue.
This is the reason why the UK government and the EU are negotiating along the lines of a virtual customs union, with minimal regulatory checks. The agreement on the Irish backstop in December has dramatically reduced the political room for manoeuvre on Brexit. It’s either that, no deal, or a last minute reversal. Such is the universe of available options.
We see the debate about a second referendum to be equally based on a lot of misinformation, such as the idea of an amendment to the withdrawal treaty that makes it subject to a referendum. The EU would invariably interpret this as a rejection of the entire treaty. There are circumstances in which the EU might extend the Article 50 period. The likelier of the scenarios is for this to buy a little more time - a few weeks at most - to allow for ratification. The less likely, but still possible, scenario would involve the UK government informing the EU that the UK wants to reconsider Brexit and hold a second referendum - even if the EU would be less than impressed by such a legally and politically uncertain parliamentary manoeuvre.