A WTO No Deal Brexit is now the only way to honour the referendum result

As Attorney General Geoffrey Cox’s attempts to procure a legally-binding change to the backstop appear to have proven futile, the last hope for Theresa May’s deal is slipping away. Reportedly, the Cabinet already anticipates another crushing Commons defeat when the vote is held tomorrow. As with the earlier vote in January, the Prime Minister will be outflanked […]

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As Attorney General Geoffrey Cox’s attempts to procure a legally-binding change to the backstop appear to have proven futile, the last hope for Theresa May’s deal is slipping away. Reportedly, the Cabinet already anticipates another crushing Commons defeat when the vote is held tomorrow.

As with the earlier vote in January, the Prime Minister will be outflanked on both sides. Firstly, by Remainers of all stripes who seek to press home the huge advantage May ceded to them: following the rejection of her deal, in two subsequent votes, these MPs will be able to rule out a No Deal with World Trade Organisation rules, and then seek an extension to Article 50 in the hope of bringing about a second referendum.

On the other hand, the eurosceptic Conservatives of the European Research Group, led by Jacob-Rees Mogg, have made it abundantly clear they will not vote for the Withdrawal Agreement without real movement on the backstop. In line with their ‘three tests’, the ERG rightly demands a temporary arrangement from which Britain could unilaterally exit, replacing the potentially indefinite one which would turn Britain into a vassal state. Geoffrey Cox, however, is getting nowhere fast; and for the second time, May’s deal seems doomed. 

In terms of leverage over her divided party, May can no longer use the threat of No Deal to bring Tory Remainers round to her deal, after sanctioning the 13th March vote – however hard she tries. Clearly, the Government still thinks it can use the opposite threat of ‘No Brexit’, or ‘No real Brexit’, to whip the troublesome eurosceptics into line. Accordingly, the Prime Minister used her speech in Grimsby on Friday to frame her deal as the last chance for the ERG – and Brexiteers – to get something resembling what they want.

Another key player, Philip Hammond – the anti-Brexit Chancellor, as Get Britain Out has previously written about here – could hardly have been clearer about this when he warned last week:

“For those people who are passionate about ensuring that we leave the European Union on time, [the prospect of a vote to delay Brexit] surely must be something that they need to think very, very carefully about now because they run the risk of us moving away from their preferred course of action if we don’t get this deal through.”

Rightly however, the ERG are showing resolve in the face of this tactical threat. Jacob Rees-Mogg argued last week that even if her deal is rejected and MPs vote for an extension to Article 50, these votes are not legally binding. It still remains in the power of the Government to deliver Brexit on time given ‘votes in the House of Commons cannot override the law’. May could choose not to request the extension from the European Union. It is therefore possible to oppose both the current deal and the efforts to delay the satisfaction of the referendum result beyond 29th March.

Despite the tumult of the past few weeks, we must not forget that in law, following the passing of Article 50, the UK is set to leave the EU on 29th March – with or without a deal. If May is truly determined to deliver Brexit on the 29th, then there is a clear and legal route for her to do so following the likely defeat of her deal.

A WTO No Deal Brexit would ensure Britain leaves the European Union on time, in accordance with Article 50. Yet pursuing this course would not merely be an exercise in damage-limitation. The course remains attractive in and of itself. The economic case for No Deal has been made by Get Britain Out here and here.

What’s more, a WTO No Deal Brexit would firstly deliver on most of the Leave platform and, secondly, present major improvements to the Prime Minister’s deservedly unpopular deal.

Firstly, the repatriation of control over laws, money, borders and fisheries would be secured by a WTO No Deal Brexit. Only a free trade deal with the EU would be missing. On the other hand, precisely such a trade deal with the EU27 would become more likely in the event of No Deal. It has proven so elusive during the negotiations because Britain’s bargaining power has been continually squandered by the Government, ably assisted by the Labour Party.

Jeremy Corbyn has not only come out in favour of a second referendum, but has long advocated Customs Union membership post-Brexit. Whether it is attempting to tie the UK to EU regulatory standards indefinitely, or reverse Brexit completely, such measures can only have given succour to all those on the continent who have never taken Britain’s decision to Leave seriously.

However, if Britain simply Leaves the EU on 29th March, and pursues the radical free trade programme of tariff cuts on up to 90% of imported goods – as leaked from Liam Fox’s Department for International Trade last week – we could call the EU’s bluff by daring to prosper outside its institutions.

Under this ‘hard but smart’ Brexit, as recommended by the IFO Institute in Germany – one of the leading economic research institutes in Europe and regularly quoted in the German media – costs for consumers and businesses would be cut whilst Britain’s negotiating hand would be strengthened. So far, the Government’s unwillingness to present No Deal as a viable option has tied its hands in Brussels. Ironically, this lack of belief in Brexit has made by a WTO No Deal Brexit more likely.

Secondly, the significant advantages of a WTO No Deal Brexit over May’s Deal must not be overlooked, although Geoffrey Cox’s failure to secure a meaningful alteration to the backstop so far will be seen as the central reason for the Government’s likely defeat in Parliament on Tuesday. We should remember the backstop – absolutely unacceptable though it is – was never the only problem with the deal, as Get Britain Out has documented in full here.

As Sir John Redwood has recently made clear in an open letter to Geoffrey Cox, the proposed ‘transition’ period of up to 45 months marked out in the Withdrawal Agreement would turn Britain into a rule-taker with no power of reply.

This would be a fundamental challenge to Britain’s independence. The wide-ranging nature of this threat encompasses everything from business regulations and trading relationships to taxation. Moreover, the UK taxpayer would be paying at least £39 billion for the privilege.

On the other hand, a WTO No Deal Brexit would save Britain from this unnecessary expenditure, which could be better spent on domestic priorities. This Brexit dividend would also include the money saved following the immediate cessation of budget contributions to the EU. Under May’s deal these would continue.

Provided Cox was successful in his renegotiation of the backstop, leading eurosceptics were prepared to accept May’s deal. Rees-Mogg was prepared to back it because if the backstop became time-limited, and Britain could unilaterally leave the EU if no trade deal was struck during the transition, then all the above problems with May’s deal would be time-limited too.  

A spirit of compromise was in the air. A willingness not to make the best the enemy of the good. Now a legal change to the backstop seems impossible – and tomorrow, barring some cosmetic alterations – exactly the same deal which was rejected by an historic 230 votes in January will, in all likelihood, be put to Parliament again.

Eurosceptics must not make a very bad deal the enemy of the best deal now available. Let’s Get Britain Out with a WTO No Deal Brexit on 29th March.

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With 50 days until 29th March, the clock is ticking and many of us are hoping for a WTO Brexit

Theresa May is going back to Brussels today following her visit to Northern Ireland, to meet Jean-Claude Juncker and seek changes to the Withdrawal Agreement. But we already know that the EU has said many times that they will not re-open the Withdrawal Agreement, as doing so would mean completely re-writing it after two years’ […]

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Theresa May is going back to Brussels today following her visit to Northern Ireland, to meet Jean-Claude Juncker and seek changes to the Withdrawal Agreement.

But we already know that the EU has said many times that they will not re-open the Withdrawal Agreement, as doing so would mean completely re-writing it after two years’ work on the task.

On 14th December at a Leave Means Leave event, Jacob Rees-Mogg said that of the 585 pages that make up the Withdrawal Agreement, 68 pages concerned the backstop. However, he said that these 68 pages were not pure legal text, they were in fact a 68-page list of legal directives that apply to it!

How exactly can all of this be unpicked to create a new Withdrawal Agreement in time for 29th March, bearing in mind that the European Parliament’s five-year term ends on 18th April? There simply would not be time.

The Telegraph reported yesterday that Theresa May plans to put her revised Withdrawal Agreement to another vote before Parliament at the end of February but this may well end in another crushing defeat, especially if there are no concrete changes to the backstop.

David Davis is now saying he wants to present the Free Trade deal to the EU that he authored last summer, but was rejected in favour of the Chequers blueprint. Will they accept this at the eleventh hour, as he believes?

We also heard yesterday that some Cabinet ministers are suggesting they would need until 24th May in order to get through important Brexit legislation – but it is unclear yet whether the EU would accept this and whether it would mean a formal extension of Article 50.

There is also talk of an amendment being tabled at the end of February to block a no-deal Brexit after the Caroline Spelman amendment passed by eight votes on 29th January. Again, what would this mean?

It would certainly mean extending Article 50 to prolong talks with the EU to create a new Withdrawal Agreement, so that we do not leave without a deal in place. Extending Article 50 would also require the agreement of all 27 Member States – and if just one disagreed, it could not be extended.

However, as I mentioned above, the European Parliament ends its five-year session on 18th April and does not come back until July, in the wake of the European elections taking place between 23rd and 26th May.

If we were to extend Article 50, would it mean that we would have to fight those European elections in May, as we would still be a member of the EU?

This would surely not now be possible because the EU has already re-allocated 27 of the 73 British seats to other Member States, with 46 of them remaining empty to be used in future for any new Member States.

It seems unlikely that the EU would want its timetable disrupted by our Brexit indecision. We have already heard quite clearly from Michel Barnier that they do not want to reopen the Withdrawal Agreement to make any changes. They feel they have given enough time to it and need to move on to other things, since there are 27 other countries with their own issues to deal with.

Nevertheless, the Remainers in Parliament will be racking their brains right now as to how to stop Britain leaving the EU without a deal on 29th March.

A second referendum would most likely take at least a year to put together, which would mean an extension to Article 50 of a year or longer.

Would Remain MPs try to force the Government to revoke Article 50 altogether? This seems highly unlikely because of the huge backlash it would cause in Britain, not to mention the extreme embarrassment of our country spending nearly three years trying to get Britain out of the EU, with the whole world watching, only to drop the whole idea.

So the conclusion is that the only thing that Remainers could try to foist upon us is an extension of Article 50, in order to avert a No Deal. Yet, from the above it appears this would not be possible due to the EU’s timetable and the upcoming European elections.

So many Brexiteers are keeping their fingers crossed that the clock keeps ticking and that nothing can stop us leaving on Friday 29th March on WTO rules.

Unfortunately, the case for this has not been properly presented to the country, certainly not by what I would call our “Remainstream media”. The golden opportunities need to be clearly set out, especially if the EU will cave in and accept Article 24 of GATT, allowing us to trade with them without tariffs for at least two years or longer, until we do finally agree a trade deal.

90% of world trade is done on WTO terms and a considerable percentage of our trade is currently conducted on those terms – and of course the EU sell us £90 billion more than we sell to them.

Leaving on WTO terms gives us everything we wanted when we voted to Leave: taking back control of our country, our laws, our borders, our fishing rights and our money, as well as the ability to agree free trade deals with the rest of the world. The jobs that will be created will far outweigh any short term disruption.

Roll on 29th March!

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The Malthouse Compromise explained

After readers sought further detail of the so-called ‘Malthouse Compromise’ proposals being pushed by figures representing a broad cross-section of opinion on matters European within the ranks of the Conservative Party in Parliament, BrexitCentral has obtained a document which should answer some of the questions being raised. I understand that the summary document that follows […]

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After readers sought further detail of the so-called ‘Malthouse Compromise’ proposals being pushed by figures representing a broad cross-section of opinion on matters European within the ranks of the Conservative Party in Parliament, BrexitCentral has obtained a document which should answer some of the questions being raised.

I understand that the summary document that follows has been cleared by all six participants in its production: European Research Group stalwarts Jacob Rees-Mogg and Steve Baker; Remain-backing ministers Stephen Hammond and Robert Buckland; Treasury Committee Chair and former Cabinet Minister Nicky Morgan; and Leave-backing minister Kit Malthouse, who brokered the discussions that brought the group together…

= = = = = 

Parliament may shortly face a binary choice over leaving the European Union with an agreed Withdrawal Agreement (WA) or without one. 

Many MPs find the WA in its current form unacceptable. Indeed the Commons have rejected it by a large majority. Others find the possible economic and logistical disruption of an exit without any WA equally troubling.

For too long the Brexit debate and negotiations have been stymied by a collective gamble over this choice. Each side of a naturally binary debate – Leave/Remain – was manoeuvring around this fallback arrangement in the event of the WA’s failing, to the extent that the WA itself was being neglected and consensus could not emerge about what it should and should not contain.

Our intention therefore was to create a degree of optionality to mitigate the binary quality of that choice – and to do so in a way in which those on both sides could accept a package as a whole that sought to address their concerns. The idea is that each side will find in the package proposals that they might not consider ideal but will find acceptable.

In this way we hope a consensus will emerge across the House and that we can have an eminently reasonable set of options to present to our EU partners which could command a majority – something the EU have quite rightly been asking to see for some time.

The structure of the compromise is to offer the EU a choice of two plans: Plan A is predicated on achieving agreement on a WA that addresses the principal weakness of the current version, the perpetual character of the Irish backstop, and its consequences for the Future Relationship between the UK and the EU. Plan B assumes that agreement on a WA is not possible and that both sides accept a responsibility to act so as to minimise as far as possible the disruption that might arise to people and businesses in the EU and the UK.

Both Plan A and Plan B involve the UK’s ceasing to be a Member State of the EU according to the timetable set by Article 50 of the treaties, that is on 29th March 2019.

In order therefore – Plan A – “The Deal”:

Essentially we would offer the existing WA with two changes:

First we would extend the implementation period until no later than December 2021. This would involve more money, but also provide a longer period to agree the Future Relationship (FR), with an immovable deadline to act as an incentive for talks.

Second, to address the backstop, we recognise the legitimate concern on both sides of the border on the island of Ireland about the effects of Brexit on the settled border arrangements, and the profound commitment of all parties to the Belfast Agreement. However, it is clear that the current formulation of the backstop is not acceptable to the Commons, and some of the suggested solutions to this problem essentially mean the backstop isn’t a backstop at all. We therefore propose a different basis for the backstop that is capable of being permanent. In essence the nature of the new backstop is a basic free trade agreement and a brief is attached at Appendix 1. It is important to note that the NI border arrangement requires no new technology and relies on existing administrative processes. 

All else in the WA remains the same, including, very importantly a guarantee of EU and British citizens’ rights.

If this is not acceptable to the EU, or they require more time to consider it, we would propose our Plan B:

Plan B essentially creates a transitional standstill period, at the end of which the UK would overnight become a third country in practice but during which we would have time to avoid disruption in a number of ways:

1. We would keep Plan A on offer for as long as the EU was willing to consider it,
2. We would offer to pay our net contribution (c. £10bn p.a.) in exchange for the Implementation Period as negotiated, until no later than Dec 2021, as a standstill period,
3. We would also offer legal text to support a GATT Art XXIV “zero for zero” temporary arrangement for execution either at the start of the standstill in the event the negotiated implementation period could not be secured, or at the end of the standstill if the future relationship had not been concluded (more here),
4. Both sides would prepare for WTO terms fully.
5. We would create an opportunity to discuss our future relationship with the EU as it would apply from the end of the standstill period.

This transitional period would last until the end of December 2021, during which time we would pay our net EU budget contribution, and cover our other liabilities subject to arbitration (pensions etc), and we would “stand still” on everything else – so we would remain a member of the customs union and single market, and the various other arrangements to do with security, aviation and so on. Again very importantly we would unilaterally guarantee EU citizens’ rights.

In essence this structure throws a safety net around “No Deal” diffusing the drama and mitigating the possible damage on both sides, with plenty of time allowed to agree a future relationship, which is the desired outcome for everyone. It also allows other non-EU countries to see that the UK has proposed something eminently reasonable which protects our supply chains.

If this structure of two deals is offered to the EU, we would expect it to receive serious consideration by those concerned to achieve a resolution that works for both the UK and EU. Plan A is reasonable and workable and addresses the legitimate concerns about the Irish border. Plan B provides a transitional period in which we can settle remaining differences without unnecessary economic damage or logistical difficulties, retaining optionality for all sides. In both cases there is no prejudging of the form of the FR. Maintenance of the Common Travel Area on the island of Ireland is also an important part of both plans.

The only other option is slamming the door, which would seem irrational and unfair given that the EU have pledged to use best endeavours to agree a smooth and civilized exit. On this basis, given the widespread support for this compromise, and the demonstrated majority for it, we would welcome the opportunity to develop it further with the Prime Minister such that it could be offered to our EU allies as a profoundly reasonable solution.

Appendix 1: The New Backstop

  • A revised Withdrawal Agreement (WA) which can be negotiated with the EU, thus avoiding No Deal and honouring the referendum result, whilst protecting the national interest.
  • Our proposed new backstop would guarantee departure from the Customs Union, Single Market and all EU rule-making for the entire UK.
  • It can be negotiated because it builds on the EU’s own offer (rather than asking them to compromise the single market) and the concept has already been positively received by the EU privately (they will not publicly back it whilst a permanent customs union is on the table).
  • It retains the vast majority of the draft WA but crucially removes the four poison pills that have prevented the draft WA from finding widespread support in Parliament and the country at large.
  • One of the reasons that Parliament is hostile to the Prime Minister’s current proposal is that it would place the UK in a “single customs territory” by virtue of the backstop, giving the EU no incentive to make concessions in future trade negotiations (thereby putting UK interests such as fishing at great risk). It should be noted that any single customs territory that is not the full Customs Union will require checks and customs certificates, such as Turkey is required to use.
  • This alternative WA proposes a new Free Trade Agreement (FTA) with zero tariffs and no quantitative import restrictions, and a Customs and Trade Facilitation Chapter that will deploy advanced customs and trade facilitation measures which include specific solutions for the Irish border, so the leverage would be the same on both sides. It also addresses the non-regression clauses so as to make them two-way and of the language that would be used in any trade agreement, allowing any potential end state arrangement.
  • The new backstop does not imperil the Union as it represents a permanent solution to the Northern Ireland / Ireland border making it both a backstop and a frontstop. It does not require any differences between NI and GB beyond those that exist today.
  • The new backstop will include a Free Trade Agreement in Goods, a Customs and Trade Facilitation Chapter, as well as: commitment by all parties not to place infrastructure on the Northern Ireland border; the UK adopting EU rules of origin; regulatory recognition such as in sanitary and phytosanitary (SPS) measures; in facility and inland clearance; and level playing field provisions on areas such as labour – in other words normal practice in FTAs.
  • This reformed WA is likely to command a majority in the House of Commons – it is already supported by both leave-backing and remain-backing MPs and, crucially, the DUP.

The main changes to Withdrawal Agreement:

1. No “single customs territory” between the UK and the EU, allowing the UK to regain control over its tariffs and regulations which are required to carry out negotiations for trade agreements with other countries. This makes the UK a credible trade partner for third countries after 29th March 2019.

2. A new backstop to replace the Northern Ireland Protocol which is based on what the permanent solution to the Irish border should be. This maintains the territorial integrity of the UK and allows the UK to regain control over its tariffs and regulation. Crucially to address the concerns of the Republic of Ireland, this arrangement is capable of being permanent – a frontstop – It includes:

  • a free trade agreement in goods: zero tariffs and no quantitative restrictions, providing for tariff-free trade in goods plus UK-EU regulatory cooperation.
  • no infrastructure on the Irish border: a commitment by all parties not to place infrastructure on the border.
  • regulatory recognition based on deemed equivalence because we will be identical on day one of Brexit: on sanitary and phytosanitary (SPS) and animal health measures and mutual recognition of conformity assessment, with measures to ensure that the animal health and disease control zone on the island of Ireland can be maintained.
  • level playing field provisions: on labour, the environment, competition and state aid, consistent with normal practice in FTAs, as opposed to the highly one-sided commitments in the Withdrawal Agreement.
  • a Customs and Trade Facilitation Chapter with an Irish border protocol: an agreement to deploy advanced customs and trade facilitation measures, including specific solutions for the Irish border.

This will allow us to use a range of proven solutions for our customs procedures, while reducing the burden of formalities on traders and avoiding congestion at ports, and include the principle that any necessary formalities and inspections are carried out with the minimum of delay and, to the maximum extent possible, away from the border. This will employ:

  • Inter-agency cooperation and information sharing, and recognition of the other party’s inspections and documents for certification of conformity with country or import or export
  • Simplified procedures and data processing at departure and destination for the import, export and transit of goods
  • Expedited procedures for qualifying operators, with mutual recognition of trusted trader schemes like authorised economic operator (AEO) programmes, and making them available to as many traders as possible
  • Self-assessment for importers to declare imports periodically and account for duties payable, plus support to encourage uptake
  • Inland, in-facility checks and participating in EU systems (such as TRACES) so all SPS related goods will be registered with these systems
  • Inland, in-facility checks for small businesses (who are already filling out VAT forms)
  • Adherence to international standards of the WTO and other appropriate bodies
  • Special facilitations for specific sectors like agriculture.

3. We would propose and extension of the Implementation Period to 31 December 2021, but no further.

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‘Malthouse Compromise’ wins DUP backing and support from trade experts

Late last night it emerged that MPs representing a broad cross-section of Tory opinion on Brexit had been working together on a new plan behind which Leavers and Remainers could unite. The so-called Malthouse Compromise – named after Brexit-backing minister Kit Malthouse who helped broker the discussions that brought the parties together – would provide […]

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Late last night it emerged that MPs representing a broad cross-section of Tory opinion on Brexit had been working together on a new plan behind which Leavers and Remainers could unite.

The so-called Malthouse Compromise – named after Brexit-backing minister Kit Malthouse who helped broker the discussions that brought the parties together – would provide for “exit from the EU on time with a new backstop, which would be acceptable indefinitely, but which incentivises us all to reach a new future relationship”.

Also reportedly involved in the talks that brought about the proposals were European Research Group stalwarts Jacob Rees-Mogg and Steve Baker, Remain-backing ministers Stephen Hammond and Robert Buckland, as well as Treasury Committee Chair and former Cabinet Minister Nicky Morgan.

The plan would extend the transition period by a year to December 2021, which would “allow both parties to prepare properly for WTO terms, but also provide a period in which the parties could obviate this outcome by negotiating a mutually beneficial future relationship”.

A summary of the proposals is circulating, which explains it as follows: 

Plan A – Revise negotiated Withdrawal Agreement and Framework

Outline:

  • Immediately table legal text to amend the Withdrawal Agreement to replace the backstop with an acceptable indefinite solution set
    out in A Better Deal, 12 Dec 2019
  • Maintain our offer on the rights of EU citizens in the UK, the agreed financial settlement, and the proposed Implementation Period
    (IP) until no later than Dec 2021, or sooner on conclusion of the Future Relationship (FR)
  • Require that, at the end of the IP or sooner, the UK shall negotiate fisheries access as an independent coastal state, under UNCLOS

Advantages

  • Rescues the Withdrawal Agreement
  • Maximises leverage plus secure a transition period
  • No backstop dangers: the new protocol is permanent, a “frontstop” and should be objectively acceptable to all.

Disadvantages

  • Uncertainty continues until the FR is ratified
  • Difficulty of persuading Eurosceptics to swallow:
  • – £39bn payment
  • – Saving the effect of the ECA during the IP
  • – Additional EU citizens’ rights
  •  – Other WA problems (DSC, CCP vs WTO)

Plan B – Basic transition agreement=====================

Outline:

  • Continue to offer legal text for Plan A and bilateral cooperation in areas of mutual interest, including security, in a spirit of goodwill
    and cooperation
  • Unilaterally guarantee EU citizens’ rights
  • Uphold current standards, pending a comprehensive FR
  • Offer to pay our net contribution (c.£10bn pa) in exchange for the Implementation Period as negotiated, until no later than Dec 2021
  • Require that, at the end of the IP or sooner, the UK shall negotiate fisheries access as an independent coastal state, under UNCLOS
  • Work to agree an interim GATT XXIV compliant trading arrangement, pending a comprehensive FR
  • Revise our financial offer to the minimum compatible with our public law international obligations and submit to arbitration

Advantages

  • Offers a standstill to 2021 to enable negotiations
  • Preserves optionality
  • Secures time
  • Secures exit

Disadvantages

  • Risks EU conditions, legislation, extension
  • No Withdrawal Agreement
  • Eurosceptic concern about:
  • – Structure of standstill, esp saving ECA effect
  • – Money

The DUP have been swift to endorse the Malthouse proposals, with party leader Arlene Foster issuing a statement to formally endorse the plan:

“We believe it can unify a number of strands in the Brexit debate including the views of remainers and leavers. It also gives a feasible alternative to the backstop proposed by the European Union which would split the United Kingdom or keep the entire United Kingdom in the Customs Union and Single Market. Importantly, this proposal would also offer a route towards negotiating a future trade relationship between the United Kingdom and the European Union.

“If the Prime Minister is seeking to find a united front, both between elements in her own party and the DUP, in the negotiations which she will enter with the European Union, then this is a proposition which she should not turn her back on. There is no better time to advance this alternative given the confusion and disarray which is now manifesting itself in Brussels. This has been displayed both by the contradictory EU statements and the panic stricken behaviour of the Irish government.”

Steve Baker has also released a letter in support of the Better Deal plan from a range of international trade experts, which reads as follows:

Dear Steve,

You have asked for our views as trade policy experts as to the proposal of a Better Deal as an acceptable Withdrawal Agreement that would allow the UK to proceed to the next stage of negotiations, and that would not, in our view take an independent trade and regulatory policy off the table, and would allow, if the UK so chose a clear and negotiable pathway to a comprehensive and advanced free trade agreement such as proposed in Plan A Plus.

We can confirm that in our view the UK would be best served by putting an offer like a Better Deal on the table, and allow the process of pressure and compression at the back end of the negotiations to start to take effect. We would anticipate that the UK will see datapoints emerge from the EU in the course of the next month, such as EU member state agricultural producers express concern about the possibility of no deal, especially Irish beef farmers, Bavarian dairy farmers, and French farmers. We would anticipate member states start to weaken in their unity vis-à-vis each other and the Commission. We have already seen signs of this from Germany, Poland, and from French farmers and fishermen. It is imperative that the UK keeps the pressure on (seeking an extension of Article 50 at the end of February per the Cooper-Boles amendment would be a fatal mistake as it would take the pressure off the EU just as it would otherwise be building). In addition, there is value to putting this facilitated approach on the table as if there is to be an FTA in the future, it will require discussion and evaluation now. It is better to get the EU used to UK ideas on this point, and to put some specifics behind Michel Barnier’s recent pronouncement that, in the event of no deal, alternative arrangements would have to be found for the Irish border. Furthermore, during this period, it would be important for the UK to line up its allies, especially those who run global supply chains through the UK and EU-27 such as the US, Japan, and Korea to name three in support of its reasonable proposals, thus increasing the pressure and compression on the EU.

In our view the current deal gives all the negotiating leverage to the EU during the negotiating phase and makes the path to an advanced FTA such as we have proposed in Plan A Plus extremely difficult. If comfort could be given that such an un-occluded path exists, then support might be brought to bear on all sides for an agreement allowing the transition period to be retained.

Yours sincerely,

Peter Allgeier, Former Deputy USTR and Former US Ambassador to the WTO
Eduardo Perez-Motta, Former Mexican Ambassador to the WTO and Former Chairman of the Mexican Competition Commission
Alan Oxley, former Chairman of GATT Council, Former Australian Ambassador to the WTO, founder of the Cairns Group
Lockwood Smith, former Trade Minister of New Zealand
Shanker Singham, former cleared advisor to US government, Mitt Romney Presidential Campaigns of 2008 and 2012, and formerhead of Squire Patton Boggs Market Access/WTO practice
Hans Maessen, Customs specialist, SGS Corporation, and representative of CLECAT, European Association of Customs Professionals
U. Srinivasa Rangan, Professor of International Business, Babson College, US

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Paddy’s blistering tweet about Jacob Rees-Mogg and the ERG

It’s not often we feature a single tweet but this classic blast of high octane Paddy deserves its own post!: We see clearly now who the ERG playgroup really are. Bad judgement, poor timing, over-grown egos, fantasy politics, prep-school tactics – they are less a political movement – more a Beano comic strip about Lord […]

It’s not often we feature a single tweet but this classic blast of high octane Paddy deserves its own post!:


* Paul Walter is a Liberal Democrat activist. He is one of the Liberal Democrat Voice team. He blogs at Liberal Burblings.

ERG publish Your Right To Know – the case against the Government’s Brexit deal

Four days after the release of the 585-page draft Withdrawal Agreement for the UK’s exit from the European Union, the European Research Group (ERG) of eurosceptic Conservative MPs today publishes a concise guide making the case against the putative deal. In Your Right to Know, the group – chaired by Jacob Rees-Mogg – seeks to put […]

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Four days after the release of the 585-page draft Withdrawal Agreement for the UK’s exit from the European Union, the European Research Group (ERG) of eurosceptic Conservative MPs today publishes a concise guide making the case against the putative deal.

In Your Right to Know, the group – chaired by Jacob Rees-Mogg – seeks to put the case against what Theresa May has agreed with the EU in plain English – and BrexitCentral is exclusively publishing the full text of the 7-page document.

The publication identifies five key areas of concern over the draft Agreement:

  1. The UK would hand over £39 billion of taxpayers’ money with nothing guaranteed in return
  2. The UK would remain a ‘rule taker’ over large areas of EU law
  3. It would lock us in a Customs Union without the ability to leave
  4. It would creates internal borders within the UK, undermining the integrity of the Union
  5. The European Court of Justice would remain in control of the agreement and large areas of EU law directly effective in the UK

The ERG conclude:

“The combination of these measures means the United Kingdom will have not left the European Union but will instead be ‘half in and half out’. This will mean that we will become a ‘vassal state’ many of whose laws will have been created abroad and over which we have no influence. This is completely against the spirit of the 2017 referendum in which 17.4 million UK citizens voted to leave the European Union.”

You can read the document for yourself below or by clicking here to read it as a pdf.

Your-Right-to-Know

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Text of Jacob Rees-Mogg’s letter urging MPs to oppose the draft Withdrawal Agreement

This evening, Jacob Rees-Mogg, Chairman of the European Research Group of MPs, has written to his parliamentary colleagues urging them to join him in voting down the draft Withdrawal Agreement as endorsed by the Cabinet after its 5-hour meeting. The text of his letter is as follows: ———————————————– Dear Colleagues, Like you I supported the […]

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This evening, Jacob Rees-Mogg, Chairman of the European Research Group of MPs, has written to his parliamentary colleagues urging them to join him in voting down the draft Withdrawal Agreement as endorsed by the Cabinet after its 5-hour meeting.

The text of his letter is as follows: ———————————————–

Dear Colleagues,

Like you I supported the Prime Minister in her early approach to the Brexit negotiations. I agreed with her Lancaster House speech that this should be built around the ability of the UK to take back control of our laws, borders and money while safeguarding our precious Union.

Unfortunately the proposals for a UK/EU agreement released today do not match up to those early expectations. For four key reasons.

1. The proposed agreement will see the UK hand over £39 billion to the EU for little or nothing in return. The prospect of an agreed free trade agreement is as far away today as it always has been. The 15 page political declaration is neither binding nor clear in its intentions. If it aims to put in place the Chequers proposal it is neither workable nor respectful of the referendum result. In the absence of a trade agreement we should spend our money on our own priorities, for instance £39 billion could pay for 26,000 nurses for 40 years.

2. The proposed agreement would treat Northern Ireland differently than the rest of the UK. This is unacceptable to Unionists particularly in Northern Ireland, and Scotland where the SNP will seek to demand similar internal UK borders to weaken the Union.

3. This agreement will lock us into an EU customs union and EU laws. This will prevent us pursuing a UK trade policy based around our priorities and economy. Without the ability to regulate our own economy and form our own trade agreements we will lose out on the opportunities that Brexit affords us.

4. Agreeing to be subject to the rules of an EU Customs Union, in contravention of the 2017 Conservative manifesto, without any votes or influence is profoundly undemocratic. This is compounded by the lack of any ability for the UK to unilaterally escape, making the UK a permanent rule taker.

For these reasons I can not support the proposed agreement in Parliament and would hope that Conservative MPs would do likewise.

Yours ———————————————————————-

Jacob Rees-Mogg MP

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