Prime Minister Theresa May said she’ll begin the U.K.’s withdrawal from the European Union in the first quarter of 2017 in her clearest announcement yet about her government’s Brexit strategy.
The premier told delegates at her Conservative Party’s annual conference in Birmingham, central England, that she’ll invoke Article 50 of the EU’s Lisbon Treaty — the formal trigger for two years of talks — before the end of March. May also said she’ll introduce a bill next year to convert all existing EU laws into U.K. legislation on the day that Brexit is completed to provide certainty for business and investors.
“We should not let things drag on too long; having voted to leave, I know that the public will soon expect to see, on the horizon, the point at which Britain does formally leave the European Union,” May said in a speech on Sunday. “There will be no unnecessary delays in invoking Article 50. We will invoke it when we are ready. And we will be ready soon. We will invoke Article 50 no later than the end of March next year.”
May’s announcement signaled that the two years of Brexit negotiations should be completed in 2019, 46 years after the country joined the bloc, though Trade Secretary Liam Fox cast some doubt on that timetable.
“Everything we do as we leave the EU will be consistent with the law and our treaty obligations, and we must give as much certainty as possible to employers and investors,” said May. “I want to give British companies the maximum opportunity to trade in and operate in the single market.”
May pledged to control immigration in Britain’s best interests while retaining access for business to the European single market.
But still left unsaid is what exactly the prime minister will seek in the talks and what her counterparts in Europe will agree to. As well as commerce and immigration, the two sides must find common ground on rights for their citizens in each other’s territory, the border between the two Irelands and what if anything the U.K. contributes to the EU budget. There’s also a string of legal, regulatory, energy, agricultural and security issues to address.
European Union President Donald Tusk welcomed May’s announcement for bringing greater clarity to the timing of Brexit talks. The remaining 27 member states of the EU will engage with the U.K. once Article 50 is invoked, he said.
“I know some people ask about the ‘trade-off’ between controlling immigration and trading with Europe. But that is the wrong way of looking at things,” May said. “We have voted to leave the European Union and become a fully independent, sovereign country. We will do what independent, sovereign countries do. We will decide for ourselves how we control immigration. And we will be free to pass our own laws.”
The government’s planned “Great Repeal Bill” will abolish the 1972 European Communities Act that took Britain into what was then the European Economic Community, while converting all EU laws governed by it into domestic legislation on the day Britain eventually completes its pullout, May said. Subsequent governments will then be able to repeal or amend individual laws if needed.
The bill will be introduced in Parliament between May 2017 and May 2018, Transport Secretary Chris Grayling told ITV’s “Peston on Sunday” program. On the same show, former Business Minister Anna Soubry, who left her post when May became premier, said that the repeal act was a necessary step but not a “big deal.” She called for more detail on the “guiding principles” of the government’s Brexit plan and expressed concern at the timeline.
‘Something Worse’
“We need to know what are our red lines as we go into this process,” Soubry said. “This idea that we hold the cards and that the EU is going to come to us and say, ‘Do you know what, we’ll give you pretty much what you want’ — the idea that we’re going to get anything like we’ve got now is rubbish. We’re going to get something worse.”
Asked if he could be 100 percent certain that the U.K. would be out of the EU by the time of the next general election, scheduled for 2020, Fox declined to give a guarantee.
“What we want is the best exit for the United Kingdom, not the quickest,” he said at an event in Birmingham before the start of the party conference. “I wouldn’t put a timescale on it. Again, I think that’s one of the cards we have in our negotiation. Why would we want to hand it over at the outset?”
The British premier also said she will not allow Brexit to be used by nationalists to break up the U.K. That drew the response from pro-EU Scottish First Minister Nicola Sturgeon, who has held out the prospect of a new Scottish independence referendum, that May “is going out of her way to say Scotland’s voice and interests don’t matter.”
In the continued absence of any detail on the nature of the future relationship with the EU, Sunday’s announcement may exacerbate concerns among investors that the government will pursue what’s become known as a “hard Brexit.” That would see it willingly surrender membership of the EU’s single market for trade in return for more power over immigration, law-making and the country’s budget.
The pound just wrapped up its worst quarterly run against the dollar since 1984, driven down first by the result of the June 23 referendum and then kept weak by speculation of a swift, severe break. It found some support as the economy proved more resilient than most forecast.
Business Anxiety
Nissan Motor Co. Chief Executive Officer Carlos Ghosn signaled on Sept. 29 that he may not be able to make new investments in Britain without a government pledge for compensation in the event of adverse consequences stemming from Brexit. And Vodafone Group Plc has said it’ll consider moving its headquarters to mainland Europe if Britain doesn’t preserve access to the EU’s single market.
“Businesses need day-one certainty on the rules and regulations they will face when the U.K. exits the European Union,” Adam Marshall, the acting director general of the British Chambers of Commerce lobby group, said in a statement. “Businesses will welcome Mrs. May’s focus on stability, but will await the details of the planned ‘Great Repeal Bill’ and a better understanding of the terms of trade they will face in future, to pass final judgment.”
Virtual Unanimity
Having agreed to grant May space to form a strategy, the 27 other EU leaders are virtually unanimous in arguing she cannot “cherry-pick” the best parts of membership, a Bloomberg News analysis showed. The U.K. “cannot have the advantages of the European Union without carrying out the obligations,” Irish Finance Minister Michael Noonan said in a recent interview.
May’s latest decision will pacify those foreign officials who warned against her avoiding divorce talks long beyond the end of this year. There are elections in Germany, France and the Netherlands in 2017 and the worry was extended uncertainty would hurt already-weak economic growth and fan populist support elsewhere in the region.