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Implications of the United Kingdom/ Great Britains

Exit from the European Union


Before we tackle on the implications of Britains exit (Brexit)
from the European Union (EU), it is worth noting first why the Brits
decided to depart from the EU.
Reasons for Brexit
A look into United Kingdoms (UK) membership history shows
that it remained aloof from the continents first postwar efforts
towards integration, the European Coal and Steel Community
(ECSC) and the European Economic Community (EEC), formed in
the hopes of avoiding another war. According to the Brits, they
never entered the EU with the same political imperatives as that of
France or Germany. Nor were they been invaded or lost the war.
The Brits didnt join the EEC until 1973. But despite
membership, suspicion of political union with the rest of Europe
remained strong. Brexit critics argued that the European project
was already moving beyond mere economic integration and toward a
European superstate.
For decades, UK has had a hesitant and sometimes
contentious relationship with the European Union. London has kept
its distance from Brussels' authority by negotiating opt-outs from
some of the EU's central policies, including the common euro
currency and the border-free Schengen area. Even still, the EU's
faltering response to recent crises has fueled a renewed
euroskepticism.
The Brexit became apparent when the UK Independence Party,
who were campaigning for Britain's exit from the EU, won the 2016
European elections. Joining the cause are about half of
Conservative MPs, including five cabinet ministers, several Labor
MPs and the DUP.
Advocates are of the opinion that Britain was being held back
by the EU, which imposed numerous rules on business and charged
billions of pounds a year for membership fees, yet miniscule in
return. Advocates argued that by reclaiming its national sovereignty,
the UK would be better able to manage immigration, free itself from
onerous regulations, and spark more dynamic growth.

Reasons for UK to Stay

Prime Minister David Cameron carried the voices of the proEU supporters on the fight for UK to stay in the EU. EU supporters
claim that UK gets a big boost from membership in the EU. Selling
goods and services with other EU countries are easier, and the flow
of immigrants fuels economic growth. Also, being a member harbors
greater security against uncertain future events that might lead to
economic downfall rather than standing alone.
Business analysts speculates that the Brexit would benefit
the UK economy, in a way, that it would allow UK to make trade
negotiations as a country and not merely as part of the 28 EU
states. On the other hand, although matters are yet uncertain, the
break-away of UK from the EU could damage trade relations with
other EU member leading to an inter-state silence. There is that
possibility that EU will make decapitating terms in the withdrawal
agreements so as not to encourage other member states to break
away from the union. In effect, UK will be put in a more stressful
environment then it was when it was a member. Although some
analysts speculate that such an event would be off-setted when UK
establishes trade relations with other countries other than the EU.

Implications of the Brexit:

Laws to be observed
In order for the Brits to leave the EU, it has to invoke Article
50 of the Lisbon Treaty1. It is through such invocation will then set
in motion the formal legal process of withdrawing from the EU, and
1 Article 50 of the Lisbon Treaty1. Any Member State may decide to withdraw from the Union
in accordance with its own constitutional requirements.
2. A Member State which decides to withdraw shall notify the European Council of its intention. In
the light of the guidelines provided by the European Council, 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. That agreement shall be negotiated in
accordance with Article 218(3) of the Treaty on the Functioning of the European Union. It shall be
concluded on behalf of the Union by the Council, acting by a qualified majority, after obtaining the
consent of the European Parliament.
3. The Treaties shall cease to apply to the State in question from the date of entry into force of the
withdrawal agreement or, failing that, two years after the notification referred to in paragraph 2,
unless the European Council, in agreement with the Member State concerned, unanimously decides
to extend this period.
4. For the purposes of paragraphs 2 and 3, the member of the European Council or of the Council
representing the withdrawing Member State shall not participate in the discussions of the European
Council or Council or in decisions concerning it.
A qualified majority shall be defined in accordance with Article 238(3)(b) of the Treaty on the
Functioning of the European Union.
5. If a State which has withdrawn from the Union asks to rejoin, its request shall be subject to the
procedure referred to in Article 49.

give the UK two years to negotiate its withdrawal. But, as the law
demands, the EU law still stands in the UK until the date of entry of
such withdrawal agreement although it can no longer take part in
any decision-making.
Then there is the question what if UK decides to rejoin the EU, will
it be accepted? This is a matter best resolved through politics,
Article 50 with reference to Article 49 2 of the Lisbon Treaty suggests
that UK would have to start from scratch with no rebate, and enter
accession talks with the EU. Furthermore, the law provides that the
agreement has to be ratified by all contracting States of the EU,
other leaders might not be too generous towards any UK demands.
ECHR decisions still binding despite exit
The European Court of Human Rights (ECHR) in Strasbourg,
France is not a European Union institution nor is it related with the
Court of Justice of the European Union (CJEU). It is rather a supranational or international court set up by the Council of Europe, in
accordance with Article 19 of the European Convention of Human
Rights which charges the Court with ensuring the observance of the
engagement undertaken by the contracting states in relation to the
Convention and its protocols. Hence, membership in the EU does
not in any way affect the binding decisions of the court.

Article 49 of the Lisbon TreatyAny European State which respects the values referred to in
Article 2 and is committed to promoting them may apply to become a member of the Union. The
European Parliament and national Parliaments shall be notified of this application. The applicant
State shall address its application to the Council, which shall act unanimously after consulting the
Commission and after receiving the assent of the European Parliament, which shall act by an
absolute majority of its component members. The conditions of admission and the adjustments to
the Treaties on which the Union is founded, which such admission entails, shall be the subject of an
agreement between the Member States and the applicant State. This agreement shall be submitted
for ratification by all the contracting States in accordance with their respective constitutional
requirements. The conditions of eligibility agreed upon by the European Council shall be taken into
account.

Single market system still applies?


The single market system is seen to be EUs greatest
achievement and one of the reasons it was set up in the first place.
It allows the free movement of goods, services, money and people
within the EU as if it was a single country. In other words, it is
possible to set up a business or take a job anywhere within the EU.
The idea was to boost trade, create jobs and lower prices of goods
and services in order to build a strong and competitive economy.
The continued application of the single market system however
depends with the kind of withdrawal agreement the UK and the EU
with its member States agree upon. If UK remains with the single
market system, it would retain free movement rights allowing UK
citizens to work and trade in EU member states and vice versa. If
however UK opts to impose work or business permit restrictions,
then other countries would reciprocate such acts and impose the
same against UK citizens.3 On the other hand if UK leaves, it can
freely establish its own trade agreements without EUs strangling
regulations.
Whether other EU countries would offer generous terms in the
withdrawal agreement or not is one of the big unknowns of the
agreement. Brexit supporters argued that it would be in the
interests of other European countries to re-establish free trade, but
EU supporters suggests that the EU would want to make life hard
for Britain in order to discourage further breakaways.

Investment

Brian Wheeler and Alex Hunt, The UKs EU Referendum: All you need to Know, BBC
News (June 24, 2016), http://www.bbc.com/news/uk-politics-32810887

In an online news article The Week4, there are two diverging


views on the matter of investments: EU supporters are of the
opinion that the UK's status as one of the world's biggest financial
centers will be diminished if it is no longer seen as a gateway to the
EU for the likes of US banks, while Brexit supporters suggest that,
free from EU rules and regulations, Britain could reinvent itself as a
Singapore-style supercharged economy.
Barclays, however, put forward a worst-case scenario, saying
that the departure of one of the EU's most powerful economies
would hit its finances and boost populist anti-EU movements in
other countries. This would open a "Pandora's box", said the Daily
Telegraph, which could lead to the "collapse of the European
project".
The UK would then be seen as a safe haven from those risks,
attracting investors, boosting the pound and reducing the risk that
Scotland would "leave the relative safety of the UK for an
increasingly uncertain EU".5
4

EU Referendum: What are the Pros and Cons of Brexit?, The Week (June 27, 2016),
http://www.theweek.co.uk/brexit-0
5

Id.

UK not more Sovereign than remaining in EU


Labour MP Kate Hoey says the EU is "an attempt to replace the
democratic power of the people with a permanent administration in
the interests of big business". But pro-EU advocates opine that EU
membership involves a worthwhile trade of sovereignty for
influence: in return for agreeing to abide by EU rules, Britain had a
seat around the table at which they are set and its voice was
amplified on the world stage as a result.
"The truth is that pulling up the drawbridge and quitting the EU
will not enhance our national sovereignty," warned Labour's Hilary
Benn. "All it would do is to weaken it by taking away our power to
influence events in an ever more complex and interdependent
world." Nor will UK sovereignty be absolute out of the EU: the
British government would still be bound by membership of Nato,
the UN, the World Trade Organization, and various treaties and
agreements with other nations.

Immigration
Under EU law, Britain cannot prevent anyone from another
member state coming to live in the country, while Brits benefit from
an equivalent right to live and work anywhere else in the EU. The
result has been a huge increase in immigration into Britain,
particularly from eastern and southern Europe.
According to the Office for National Statistics, there are
942,000 eastern Europeans, Romanians and Bulgarians working in
the UK, along with 791,000 western Europeans and 2.93m workers
from outside the EU. China and India are the biggest source of
foreign workers in the UK6.
6

EU supporters claim that, while the recent pace of


immigration has led to some difficulties with housing and service
provision, the net effect has been overwhelmingly positive. By
contrast, others insisted immigration should be cut dramatically,
and that leaving the EU was the only way to "regain control of the
borders". Other Brexit supporters would not necessarily reduce
immigration, but said that it should be up to the British
Government to set the rules7.

Conclusion
In every situation, there is always two sides of a coin. Both the
Brexit supporters and the EU supporters present an equally
persuasive argument on the consequences of UKs breaking away
from the EU. But my personal take on the situation is tilted to the
Brexit side.
In the short run, UK might momentarily have a hard time with
trade relations with its former mates in the EU but such do not
pose a grave danger to its economy. UK has profoundly established
a name for itself on its own stand without the benefit of the EU.
History would tell us that UK was never really in need to join a
union in order to rebuild its economy from the damages of war, in
fact UK didnt even loose the war in the first place, UKs motive to

Office of National Statistics UK (April 2016),


https://www.ons.gov.uk/employmentandlabourmarket/peopleinwork/employmentand
employeetypes
7

Wheeler, supra

join the EU was to expand trade relations under the single market
system.
Seeing that UKs intention of joining the EU to expand its
economic base is rather undermined by the rules and regulations of
the Union itself, UK is at best to leave EU and expand its base
globally.

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