René Repasi, Associate Professor
of EU Law at Erasmus University Rotterdam, Netherlands
After the elections
in the UK and the clear majority of the Conservative Party under Prime Minister
Boris Johnson in UK House of Commons the Withdrawal
Agreement (WA) concerning the UK’s exit from the EU was promptly ratified,
with the UK leaving the EU on 31 January 2020. This completes phase 1 of ‘Brexit’:
Dealing with the legacy of the UK’s membership.
We are now entering
phase 2: The negotiation of and the decision about the future relationship
between the EU27 and the UK. Originally, phase 2 should be concluded during the
transition period of the Withdrawal Agreement, during which the UK remains part
of the internal market and subject to EU law. This transition period expires on
31 December 2020 (Article 126 WA). The Joint Committee (JC) of the WA (composed
of officials of the European Commission and the UK Government and co-chaired by
a Member of the European Commission and a Minister of the Crown) can adopt, by mutual
consensus, a single decision extending the transition period for up to one or two
years (Article 132(1) WA). Such decision can be requested from both the EU and
the UK. The purpose of this prolongation possibility was originally (in March
2019) and still is to avoid an undesired ‘hard Brexit’ because of unfinished
trade negotiations. The decision of the JC to extend the transition period must
be taken before 1 July 2020.
The newly elected Prime
Minister Johnson does not intend to make use of this prolongation possibility
and wants to strike a trade deal with the EU before 31 December 2020. In order
to emphasise this commitment, the Withdrawal
Agreement Act includes a section 33, according to which ‘[a] Minister of
the Crown may not agree in the Joint Committee to an extension of the
implementation period’. This means that – in the event a trade agreement between
the EU27 and the UK is not ratified on 31 December 2020 – there will be a ‘hard
Brexit’ on 1 January 2021 if the deadline of 1 July 2020 elapses without any
prolongation decision of the JC.
Extending the Transition Period after 1 July 2020 if
there is a political will
This situation begs
the question whether there are other possibilities – past 1 July 2020 – to
prolong the transition period, during which the UK remains part of the EU’s
internal market and subject to EU law, until a trade agreement is ratified, if there
is a political will on both sides to do so. As a baseline, any prolongation of
the transition period after 1 July 2020 is legally excluded because the WA does
not provide for any other mechanism to do so. There are, however, two legal pathways
to explore that might nevertheless lead to a prolongation of the transition
period:
-
A new transition period could be
established by a new and distinct agreement between the EU and the UK;
-
The ‘old’ transition period of the
WA could be prolonged by replacing the original end date in Article 126 WA
through amendment of the WA.
New and Distinct Agreement would Undermine EU Rules on
Membership
A new and distinct
agreement that includes a new transition period starting on 1 January 2021 would
need, on the EU’s side, an explicit or at least implied competence to grant
such a ‘status’ to a third country (Article 216(1) TFEU), which the UK will be
after 31 January 2020. Article 50 TEU, being the legal base on the part of the
EU for the establishment of the original transition period in the Withdrawal
Agreement, would not serve as a legal basis for such an agreement as the new
and distinct agreement would be concluded with a third country and not with
‘[a] Member State which decides to withdraw’. We may now think of a construct that
the ‘transition’ equals some sort of a ‘temporary association arrangement’ of
the UK with the EU so that Article 217 TFEU might suffice as a legal base. Yet,
looking at previous instances when Article 217 TFEU was used, an association implies
stability and permanency, which runs counter to the very idea of a transition
period. Finally, Article 207(1) TFEU could also not be used on its own as
rights and obligations that the ‘transition period’ implies go beyond the
‘common commercial policy’. The transition period prolongs, in substance, the
EU membership beyond the official exit date of a Member State. The substance of
EU membership covers more than the ‘common commercial policy’.
What remains, would
be basing a new and distinct agreement that introduces a new transition period
(for example, together with a future customs arrangement between the UK and the
EU) on a combination of legal bases and Article 352(1) TFEU, as it was done previously
when the EU joined the WTO agreements (cf. CJEU, Opinion
1/94). Whilst this construct certainly allows for quite a comprehensive
scope of an agreement, triggering mixity so that also national Parliaments have
to ratify it, it would not work for extending the transition period. This
follows from the fact that Article 352(1) TFEU ‘cannot be used as a basis for
the adoption of provisions whose effect would, in substance, be to amend the
Treaty without following the procedure which it provides for that purpose’
(CJEU, Opinion
2/94, para 30).
If we were to apply
Article 352(1) TFEU in order to introduce a new transition period, which would
keep the UK in the internal market and keep it subject to EU law, we would
create the legal possibility to grant (temporarily) EU membership (which is, in
essence, being part of the internal market and subject to EU law) to any other
third country. This would undermine Article 49 TEU and the necessity for being
a formal Member State in order to have such a status. The Treaties only provide
for one exception to deviate from this rule: a country that used to be a Member
State can keep up its rights and obligations deriving from membership for a
limited period of time after the withdrawal. The Treaties created with Article
50 TEU a special exclusive Union competence to grant such a status to a prospective
third country.
For these reasons,
a new and distinct agreement between the EU and the UK cannot introduce a new
transition period starting as of 1 January 2021. It should be noted that this
reasoning does not apply to any special arrangement that only includes a subset
of previous EU rights and obligations and a partial access to the internal
market. Such arrangement would, however, also not qualify as a ‘transition
period’.
Extending the Transition Period by Amendment of the
Withdrawal Agreement
The second pathway
to prolong the transition period would be an amendment of the original Withdrawal
Agreement itself by exchanging the end date in Article 126 WA. Some argue
now that any other way to change the transition period than its prolongation by
the JC is legally impossible. The argument is based on the reading of Article
50 TEU that its applicability to the Withdrawal Agreement ceases in the moment
the UK has exited the EU and that besides Article 50 TEU there is no legal base
in the EU Treaties that would allow the EU to amend the WA.
General Public International Law Allows for Amendments of
the WA
Another reading of
the legal situation is, however, supportable. The argument is built on general
public international law. The Vienna
Convention on the Law of the Treaties (VCLT), which is considered to codify
customary international law when it comes to the law of the Treaties, provides
in Article 39 for a general rule, according to which a ‘treaty may be amended
by agreement between the parties. The rules laid down in Part II [on the
conclusion and the entry into force of Treaties] apply to such an agreement
except insofar as the treaty may otherwise provide’. The WA provides for a
legal base for the JC to ‘adopt decisions amending this Agreement’ (Article
164(5)(d) WA) but excludes ‘Part Four’ from its scope, which contains the end
date of the WA. Although this is a specific treaty rule that allows for
amendments of the treaty text, it only covers parts of it. Drawing the
conclusion from the presence of such a limited amendment rule that the treaty
parties are deprived from amending the treaty text themselves seems stretched.
Such clauses enable quick technical amendments in place of lengthy ratification
procedures. But they cannot bar the treaty Parties from amending the treaty
text between them. In other words, the WA is silent on the revision of its text
by the treaty parties in general and, more specifically, of Part Four of the WA
with the end date of the transition period.
This brings us back
to the starting point, according to which general public international law
allows for an amendment of the WA including the end date of the transition
period after 1 July 2020. This leads to the follow-up question on the legal
base and the procedure to follow for such an amendment. On the part of the UK,
the legal base and the procedure to follow is to be found in domestic law. The
capacity of the UK to conclude treaties includes the capacity to amend them.
Provided that domestic law does not prescribe any special rules for the
amendment of the WA, the traditional rules on treaty ratification apply.
In Search of The Union Competence to Amend the Withdrawal
Agreement
On the part of the
EU, the situation is more complicated. The EU may only act if it is at least
implicitly empowered to act. There must hence be a legal base for amending the WA.
A literal reading of the original legal base for the conclusion of the WA excludes
the use of Article 50(2) TEU. This article requires an agreement with a ‘Member
State which decides to withdraw’. Once the other Treaty party involved in the
WA is no more a Member State, Article 50(2) TEU seems to cease to apply. Besides
Article 50(2) TEU, once again, Article 207 TFEU or Article 217 TFEU could be
considered as possible legal bases, given that the amendment of an agreement is
formally just another agreement. Yet, the WA exceeds the scope of Article 207
TFEU as its content covers more than ‘common commercial policy’. Also, Article
217 TFEU seems to be a rather weak legal base as it would require the establishment
of an ‘association’. Although it is not completely unimaginable to qualify the
‘reciprocal rights and obligations’ in the WA as the creation of some sort of
association between the UK and the EU, the entire purpose of the WA (except for
the Protocol on Ireland/Northern Ireland) is not meant to create an association
that lasts but to deal with legacy issues of the former membership of the UK in
the EU.
A further thought
would be to consider Article 352(1) TFEU. For the same reasons as mentioned
above, Article 352(1) TFEU cannot serve as a legal base to extend the
transition period of the WA by means of Treaty amendment. This leads us to the
(interim) conclusion that EU law does not provide for any legal base to enter
into an agreement that amends the WA so that any amendments of the WA are ruled
out by EU law.
This understanding
of EU Law makes the WA a ‘fossilised’ international agreement that could never
be changed. Such treaties (especially bilateral ones such as the WA) are
unknown to public international law. The existence of such treaties would run
counter the general international law principle (which is even considered to
have the quality of ius cogens) enshrined in Article 6 VCLT, according to which
the legal capacity to conclude Treaties cannot be limited by Treaties.
Violation of treaty obligations because of the conclusion of another treaty may
be sanctioned according to the principles of state responsibility but the
capacity to enter into other treaties may not be limited by treaty obligations.
This finding holds also true for the EU. On this basis, it is valid to state, that
as a matter of principle, whenever the EU enters into an international
agreement, it must also have the competence to amend this agreement or to
suspend it in accordance with either the procedures foreseen by the agreement
or general public international law.
Analogous Application of Article 50 TEU
Against this
background, EU law seems to have a lacuna in the case of Withdrawal Agreements
if the legal basis for concluding such agreements ceases to apply at the moment
of their entry into force. The existence of such a lacuna paves the way for an
analogous application of Article 50(2) TEU. This provision must then be read as
including a former Member State in its capacity as Treaty party to a Withdrawal
Agreement with the EU. Such analogous application is not barred by an
understanding that Article 50 TEU expires upon the withdrawal of a Member
States. The article remains the source of existence of the WA and can be
invoked for implementing measures of the WA as well as for amendments of the
original Treaty text. Only for the conclusion and ratification of a new and
distinct agreement with a former Member State of the EU, Article 50 TEU ceases
to apply.
The decision-making
procedure for amendments of a Withdrawal Agreement is hence also defined by
Article 50 TEU: a qualified majority voting in Council of the EU27 upon consent
of the European Parliament.
If therefore the deadline
of 1 July 2020 elapses unused and it turns out in November 2020 that a ‘hard
Brexit’ on 1 January 2021 can only be avoided by extending the transition
period of the WA in its Article 126, general public international law says that
this is legally possible and an analogous application to Article 50 TEU
provides for the necessary legal base on the part of the EU.
*An earlier version
of this post was published on Verfassungsblog
Barnard &
Peers: chapter 27
Photo credit:
Tobias Helfrich via Wikicommons
