‘It’s not you, it’s me’: Article 50 and the future EU-UK relationship

By Alessandra Asteriti

On 14 May 2017, the Secretary of State for Exiting the European Union David Davis was interviewed on ‘Peston on Sunday’ and the topic was, unsurprisingly, Brexit. The contentious issues of the sequencing of the negotiations according to the Council’s Guidelines for withdrawal arose. As is now known, the Chief Negotiator for the EU, Michel Barnier, has insisted that the issues of EU citizenship rights, the UK’s financial liabilities and the border between the Republic of Ireland and Northern Ireland are resolved before any discussion of the future trade relationship with the UK can proceed. This position was further affirmed in the Negotiating Directives issued by the Council on 22 May 2017 which deal exclusively with the negotiating priorities of the Withdrawal Agreement. The goal of this contribution is to point out that the plain language of Article 50 does not in fact envision the necessity of a future, separate agreement to deal with the future relationship between the EU and the UK, contrary to much debate both at UK and EU level. To be perfectly clear: I am not arguing that in fact the future relationship is not likely, or even bound, to entail such as an agreement. The argument is instead entirely predicated on the textual interpretation of the Article.

In his interview, David Davis quoted Article 50(2), which determines that: ‘the Union shall negotiate and conclude an agreement with that State, setting out the arrangements for its withdrawal, taking account of the framework for its future relationship with the Union.’

The Secretary of State added: ‘How can we take into account a future relationship that doesn’t exist yet?’. According to Davis, ‘You can’t decide one without the other; it is wholly illogical and, we happen to think, the wrong interpretation of the treaties.’ Patently, for Mr Davis, a future relationship and a future agreement are one and the same, and, further, according to him, the crucial issue is the correct sequencing of the agreements.

Is Mr Davis right? Is it illogical for the EU to demand an agreement about Northern Ireland before the agreement on the future relationship is determined? Or is Mr Barnier right to think that those three issues have to be disposed of as part of the withdrawal agreement before the future relationship can be negotiated?

Let’s go back to the text of Article 50(2): a clear sequencing of events can be evinced from the text:

1. The withdrawing Member State notifies the Council of its intention to withdraw;
2. The Council drafts guidelines for the negotiations of the withdrawal agreement (that this is the necessary second step is not explicitly spelled out, but the wording ‘in light of the guidelines […] the Union shall negotiate’ makes it clear that drafting the guidelines has to precede the start of the negotiations – whether the guidelines can be amended during the negotiations is not clarified);
3. The Union negotiates and concludes a withdrawal agreement, by setting out the necessary arrangements.

Outside the clear temporal sequencing of the negotiation is the requirement that the Union negotiates ‘taking account of the framework for its [the withdrawing Member State’s] future relationship with the Union’.

This requirement has almost universally been interpreted to refer to a future [trade] agreement between the EU and the UK. This also clearly includes Mr Davis in his interview, and the Guidelines themselves, at points 3-5. Davis goes as far as saying that to conclude that the withdrawal agreement can be finalised in advance of any deal on the final arrangements would be ‘illogical’ and the ‘wrong interpretation of the treaties’. He also derives from this interpretation a sequencing of the negotiations in conflict with the one provided by the EU. Specifically, he argues that it is not possible to finalise such issues as the border between NI and Ireland without having first agreed the future trade agreement under which the border issues can be specified (such as tariffs and custom checks).

Quite apart from the politically charged position taken by the UK government, as expressed by Mr Davis, several academics and commentators have also derived from the text of Article 50 the reference to ‘two agreements’ (see ‘Brexit: A Tale of Two Agreements’ European Law Blog, 30 August 2016).That blog post does indeed point to the legal hurdles of using Article 50 as the legal basis for the future relationship agreement, which this blog post is not concerned with. However, the former piece seemingly accepts that ‘future relationship’ refers to a future agreement to be concluded, whether concurrently or in sequence with the withdrawal agreement.

However, a straightforward textual interpretation of the text of Article 50, in accordance with Article 31(1) of the Vienna Convention on the Law of Treaties and with the customary rules of interpretation, does not warrant this reading. The Article clearly refers to the ‘framework of [a] future relationship’ and not to a future agreement. Patently, relationship and agreement are not the same thing, nor should the requirement for the latter be read in the reference to the former.

A future relationship with the EU can take many different forms with specific reference to the possible trade arrangements (which have been the almost exclusive focus of the UK government):

1. Membership of the Internal Market;
2. Membership of the Custom Union;
3. Membership of the EFTA;
4. Bespoke new UK-EU FTA;
5. Fall-back to WTO rules.

Of the five listed arrangements, only one (bespoke FTA) requires a ‘future agreement’, i.e., a new agreement to be negotiated ex nihilo. All other frameworks rely on pre-existing treaties, either as a basis of a separate agreement under the umbrella of the relevant Treaty in order to take into account the UK’s new status as a third country, or in view of the implementation of a series of amendments in the underlying treaties to accommodate the UK’s new status. The correct sequencing enjoins the Union to conduct the negotiations taking account of the choice made by the UK as to the desired future relationship: in other words, it requires the UK to enter into negotiations having clear in mind, and having made clear to its negotiating partners, the desired framework for a future relationship. In fact, Article 50 implies that it is up to the UK to determine ‘its’ desired framework. In other words, it is up to the UK to decide whether it wants to remain in the Internal Market, or the Customs Union, etc. The EU cannot dictate this choice one way or another, but can only negotiate the terms accordingly (hence the insistence of the UK not being able to cherry-pick only certain elements of each framework).

This is the most important contribution that the withdrawing State is supposed to make to negotiations that are, by general consensus, largely under the control of the Union. It is also clear that the details of the withdrawal agreement, for example, on financial liabilities or the necessity of a transitional arrangement, are dependent on the shape of the future relationship (arguably, this is not so much the case for the UK, where it is reasonably clear that no continued membership of the Single Market or Customs Union is expected. The point is instead made more generally).

Patently, Article 50 envisages a State approaching withdrawal from the EU and the terms of its future relationship rationally, having determined in advance what sort of relationship it wishes to retain with the EU. No-one could have predicted a Member State notifying its intention to withdraw without having decided, as a matter of internal, constitutional arrangements, its future course of action. This is ironic in light of the complaints of sovereignty over-reach by the EU made repeatedly by the UK: here is an EU Treaty provision that clearly leaves to the Member State the framework of any future relationship, and here the UK government is incapable of giving clear, unambiguous signals to the EU as to what it wants.

Mr Davis is right to say that the withdrawal arrangement cannot be finalised without taking account of the future relationship, but is wrong to derive from this a right to have a trade agreement negotiated in advance of, or concurrently with, the withdrawal agreement. As a matter of legal interpretation, Article 50 remains completely neutral as to what the future relationship will entail. It does not require the EU to negotiate a trade agreement, the necessity of which cannot be predicated upon a textual interpretation of the Article, neither concurrently nor in advance of the withdrawal agreement.