What happens after Britain triggers Article 50?

The Economist The Economist

It is just the start of a long process of tough negotiation—in which Britain will be the chief demandeur

Even that will be contentious, for at least two separate negotiations are involved. The main Article 50 one will be about divorce terms, including over money, assets and liabilities, regularising the position of EU and British nationals in each other’s countries and the future of EU agencies in Britain. This divorce has to be approved by a “qualified majority” of member countries, excluding Britain, and approved by the European Parliament. A second negotiation will be about future trade relations between Britain and the EU. That deal will take longer, not least because it requires the unanimous approval of all EU member countries plus ratification by all national and regional parliaments, as well as by the European Parliament.

The European Council of heads of government, chaired by Donald Tusk, will now fix the broad terms for a negotiation to be led by the European Commission in Brussels. Jean-Claude Juncker, the commission president, has asked Michel Barnier, a former French foreign minister, to head the commission’s team. The European Parliament has appointed Guy Verhofstadt, a former Belgian prime minister, as its Brexit negotiator. The two sides have very different views on the timing and sequencing of the talks. Mrs May wants the divorce and the new trading relationship to be negotiated in parallel, and reckons both can be sorted out within two years. Mr Barnier says the divorce must come first—he is already talking of a €60bn ($65bn) exit bill for Britain to pay its share of outstanding liabilities—and the long-term trading relationship, which may take more than two years to agree, second. Another complication is that several countries face elections this year, including France in May and Germany in September. That could further shorten an already tight timetable.

Article 50 puts the rest of the EU in a stronger bargaining position than Britain, not least because of its two-year deadline. In an effort to shore up her position, Mrs May has insisted that no deal would be better than a bad deal. But other EU leaders disagree. If Britain were to leave the EU without a deal, it would still face demands for money, and its trade would revert to normal World Trade Organisation terms, which would imply tariffs on exports of cars, car parts, pharmaceuticals, farm products and much else, as well as non-tariff barriers for financial and other services. It is true that the rest of the EU would suffer from such a chaotic Brexit, but Britain would suffer more. If she is to secure a mutually beneficial deal, Mrs May will have to soften her demands more than her fellow EU leaders will have to.