Brexit – Background and Procedure

Britain has been a member of the European Union since the first enlargement in 1973. In a
referendum held on 23 June 2016, however, a majority of Britons voted to leave the European Union.
Nothing much happened until UK Prime Minister Theresa May triggered Article 50 of the Treaty on the
European Union in March 2017, initiating negotiations on the terms of leaving the European Union.

2018 will be the year of Brexit decisions, and Holst, Advo- kater has dedicated a series of
newsletters to Brexit. This newsletter is our first, introducing the background and the procedure
leading to Britain’s exit from the European Uni- on.

Background

The European Union is a political and economic union of 28 member states. The Union has developed
an internal single market, ensuring the free movement of people, goods, ser- vices and capital
within the internal market. All of these free movement rights will no longer apply to Britain when
Britain ceases to be a member of the European Union. What will actually happen is still difficult
to predict as the terms are up for negotiation between Britain and the 27 remaining mem- ber
states. What we do know, however, is when it will happen and what will be the procedure thereof.

Procedure
On 29 March 2017, Prime Minister Theresa May triggered Article 50 of the Treaty on the
European Union, thereby initi- ating the procedure of Britain’s withdrawal from the Union.

Separation
Britain is scheduled to leave the European Union on Friday 29 March 2019 at 00:00 CET. If no
withdrawal agreement is rea- ched before this date, the EU Treaties will automatically cease to
apply to the UK.

Therefore, Britain and the EU have been engaged in negoti- ations on the terms of the separation.
An agreement in prin- ciple on the priority issues was reached on 8 December 2017.

Such priority issues included citizens’ rights, a financial sett- lement and the border between
Northern Ireland and Ireland. A number of specific aspects are still pending discussion.
“Sufficient progress” has been achieved, however, on the priority issues, and
negotiations have therefore moved forward to agreements on transitional arrangements and the
future relationship.

The British EU Withdrawal Bill, a Bill to repeal the Act by which EU law is given effect in Britain
and introduce new legislation following the withdrawal of Britain from the EU, was passed in both
Houses of Parliament and became law by Royal Assent on 26 June 2018.

Transition period

On 19 March 2018, Britain and the European Union agreed on a transition period. The transition
period will commence on 30 March 2019 (two years after the triggering of Article 50) and will run
until 31 December 2020.

 

Holst, Advokater Hans Broges gade 2
T, 8934 0000
[email protected] DK-8100 Aarhus C
F, 8934 0001
www.holst-law.com
Advokater
Agreements on the future UK/EU relationship cannot be formalized until Britain has left the
European Union. Conse- quently, there will be a gap between the British withdrawal and the entry
into force of the future framework. Therefore, the parties have agreed on an implementation period
to ensure an “orderly withdrawal”. Businesses and others can use this period to prepare for the
moment when the new rules between Britain and the European Union come into force.

During the transition period, Britain will continue its mem- bership in all but name. EU law will
continue to apply to and have the same legal effect in Britain as in other member states.
The European Union’s institutions and agencies will continue to have jurisdiction in Britain, but
during the transi- tion period, Britain will no longer be entitled to participate in the
decisionmaking procedures of EU institutions.

During the transition period, Britain will be able to negotiate and sign new free trade deals, but
Britain will have to wait until after expiry of the transition period for new deals to come into
effect.
Anders Hedetoft
E, [email protected] T, +45 8934 1110
M, +45 3010 2210
Anna M. Stubben Skovsgaard E, [email protected]
T, +45 8934 1182
M, +45 3010 0582
Reengagement

Agreements on the future relationship between Britain and the European Union can only be concluded
once Britain is no longer a member of the EU.

During the transition period, Britain and the European Union will negotiate on the new set of rules
framing their relations- hip.

However, Britain and the European Union have agreed on a general structure for further talks on
their future relationship, and negotiations have already begun.

Holst, Advokater will look more into the negotiations on the future relationship in our upcoming
newsletters, including the effect that this relationship will have on Denmark, Danish trade and
commercial contracts. In our next newsletter, we will focus on the various EU-principles at stake
when Britain
leaves the Union.