Scotland, the EU and ‘indyref2’: the legal issues

Professor Steve Peers

Yesterday, Scotland’s First Minister (Nicola Sturgeon) announced the Scottish Government’s wish to start the process of holding a second independence referendum, once the main elements of the UK’s final Brexit settlement was known. This follows the UK government’s rejection of alternative suggestions put forward by the Scottish government in relation to Brexit – which I previously discussed here.

Obviously any new independence referendum raises issues besides Scotland’s relations with the EU. But since the second referendum, if it goes ahead, will be more closely linked to issues of Scotland’s EU membership than the first one, it is a good moment to outline the main legal issues – and to address one specific point (on Scottish deficits as a membership criterion) in a little more detail. Of course, this blog might well be returning to these issues again in the months to come. (Some of the following is an updated version of my blog post from October 2016 on these issues.)

Scotland as an independent non-EU country

An independent Scotland might not be an EU Member State, at least initially, but rather have an association with the EU either as an interim step toward membership or indefinitely, in the event of political difficulties obtaining EU membership on either the Scotland or EU side (or both). An association with the EU might well be closer than the relationship between the remaining UK (rUK) and the EU – particularly in light of the UK government’s intention to leave the EU single market and customs union.

The most obvious route for Scotland to consider would be membership of the European Economic Area (EEA), along with Norway, Iceland and Liechtenstein. The EEA provides for participation of these non-EU countries in the EU’s single market freedoms and all the EU legislation related to them, as well as most EU employment and environmental law. But Scotland would not be covered by EU laws in other areas, notably agriculture, fisheries, tax and justice and home affairs – although, like Norway and Iceland, it could sign separate treaties with the EU on these issues. Although the current EEA countries have joined Schengen, this is a separate issue (agreed years after the EEA), and Scotland would have no legal obligation to do the same.

There would be no obligation to join the EU single currency (or any related constraints regarding deficits), and most significantly Scotland would be free to sign separate trade agreements with non-EU countries, because the EEA does not cover the EU’s customs union. This is particularly important because it means Scotland could seek to retain a closer economic relationship with the rUK than the rUK might have with the EU. Scotland could also “go global”, as Brexiteers say, by signing up to the free trade treaties already signed by members of the European Free Trade Area (EFTA: the EEA states plus Switzerland) with non-EU countries. (In principle, EFTA membership requires this). And it would retain power to sign its own treaties on top (or to seek to retain its own versions of the EU’s free trade deals with non-EU countries, as the rUK is likely to do). Scotland would have to become a separate WTO member, but could try to fast-track this by copying the rUK’s process of detaching from the EU’s WTO membership.

Is there a downside to EEA participation? Some have argued against the UK joining the EEA due to objections to single market participation, the need to accept ECJ jurisdiction, continued contributions, its undue size compared to other members, or its lack of influence over EU laws which would apply to it. Are these arguments transferable to Scotland? The first to third objections are not, since Scots voted to remain in the EU, entailing the single market, ECJ jurisdiction and budget contributions anyway. (In fact, the non-EU EEA countries are not subject to the jurisdiction of the ECJ, but a separate body called the EFTA Court: it usually follows ECJ case-law, but its decisions are not always binding. EEA financial contributions do not go straight to the EU budget, and would logically be recalculated in light of Scotland’s economic position anyway).

The fourth objection (size) is unconvincing: Scotland is broadly comparable with Norway, in particular in terms of population, location and economy. Finally, EEA states have a modest say on EU laws, being consulted on draft EU legislation and having the option to reject the application of new EU laws (although the EU might retaliate if they do that). Anyway, this is certainly more say over EU laws than Scotland would get after Brexit as part of the UK. In fact, it’s more say than Scotland gets over EU laws while the UK is an EU Member State – given the marginal influence that Scotland has over anything that the UK government does.

So the EEA option includes things that Scotland seeks (single market participation) while steering clear of things it may wish to avoid (the single currency and deficit criteria, Schengen, EU trade policy with non-EU countries, and EU fisheries policy).  It also has the advantage of being potentially far speedier than joining the EU: the EU can decide to apply treaties with non-EU countries provisionally, pending national ratification.

What about the prospect of a ‘Spanish veto’ over Scotland joining the EEA? Here we have actual evidence to suggest that it’s not very likely. For the EU has recently concluded an association agreement with Kosovo – despite Spain (and four other Member States) refusing to recognise the independence of that country after its unilateral declaration of independence. (Note: the EEA is also an association agreement, and Member States have a veto over the initial conclusion of such treaties).

Failing EEA membership, Scotland could still seek other forms of relations with the EU which may be closer than the rUK might enjoy, possibly as a non-EEA member of EFTA like Switzerland. Unless Scotland followed Turkey in joining the EU’s customs union, this would again leave it free to simultaneously retain a strong economic relationship with the rUK.

Scotland as an EU Member State

I blogged on this issue in 2014, during the first Scottish referendum, but I’ll summarise and elaborate on those views again. The basic point is that the Treaties list the Member States by name, and since the ‘United Kingdom’ is unlikely to be interpreted as automatically referring to Scotland alone after independence, either an accession Treaty (Article 49 TEU) or a Treaty amendment (Article 48 TEU) is necessary to include Scotland’s name as a member.

The Treaty amendment route – which the Scottish government called for in the previous independence referendum – could also entail an amendment to Article 49 TEU, if necessary, to refer to the special case of Scotland: “By way of derogation from the above paragraphs, Scotland shall accede to the European Union pursuant to the Treaty of Culloden”.  One possibility is a Treaty amendment which simply replacing the words “United Kingdom” wherever it appears in the Treaties with “Scotland”; this would mean that Scotland retained the UK’s opt-outs from the single currency, justice and home affairs and Schengen (the budget rebate is set out in secondary legislation). This is perfectly feasible legally, and there is a firm precedent in the Treaty of Lisbon, which in Article 2(2) to 2(8) provides for a whole host of amendments just like this: replacing “Community” with “Union” wherever it appears, for instance.  

However, the EU position at present is that it will insist upon an accession process under Article 49. This would entail a negotiation process, which could possibly be fast-tracked in light of Scotland’s existing de facto EU membership as part of the UK. It should be noted that when Iceland applied to join the EU in 2010, the Commission’s opinion on accession took account of Iceland’s EEA membership, and indeed it was possible to close many negotiating chapters quickly, before Iceland withdrew its application in 2013. By contrast, only one out of 35 negotiating chapters has been closed with Turkey, after many years of talks.

Since unanimity of Member States is required in any event, some have argued that there is a risk of a Spanish veto of Scottish accession, because of concerns that Scotland obtaining easy EU membership would inflame separatist tensions in Spain or other countries. On the other hand, some have argued that these concerns are misplaced.

Another argument is that the EU might not be willing to talk to Scotland until it is fully independent – although it should be noted that the EU has relations with Kosovo (see above), even though not all Member States recognise that country legally.

This brings us to opt-outs. If the EU is not willing to extend the UK’s current opt-outs to Scotland, this would in principle mean full participation in the single currency and justice and home affairs policies, as well as the loss of Scotland’s share of the UK’s budget rebate to Scotland. Each issue is worth further discussion.

The rebate is set out in secondary EU legislation which usually is reviewed every seven years or so, and must be agreed unanimously. Scotland would therefore be in a position to refuse its consent on the next occasion unless a rebate were agreed.

As for justice and home affairs, a distinction must be made between general EU policies and those related to Schengen – the border-free area. On the latter point, there is already a protocol to the Treaties which guarantees the continuation of the ‘Common Travel Area’ between the UK and Ireland – which will continue to apply after Brexit. The details will have to be worked out, but the starting point legally is a requirement imposed upon the EU to protect the common travel area. Arguably this not only protects the Irish position concerning the Northern Ireland border in Brexit talks, but also the position of Scotland in potential accession talks. And whatever solution is found for the island of Ireland is therefore transposable to the (rather shorter) border between Scotland and England.

As regards other JHA issues, the UK already takes part in most civil and criminal law EU measures, and so Scotland’s participation will not change anything. It should be noted that Scotland would not have to take part in the planned European Public Prosecutor, as that body will be set up by means of ‘enhanced cooperation’ and new Member States do not have to participate in measures set up by that EU framework, which is a system allowing for the adoption of EU law by a group of willing Member States, allowing the unwilling Member States to stay out (see Article 20(4) TEU).

That brings us to the single currency – and the related issue of deficits. Scotland’s deficit upon independence is sometimes discussed as if it can be calculated with absolute certainty. This is false: the actual deficit in practice would depend upon the terms of Scotland’s arrangements with the rUK, including its share of rUK debt, as well as broader trade and economic developments, including what currency Scotland uses and the decisions on tax and spending which a Scottish government takes upon independence.

While new Member States have in principle an obligation to join the single currency, it must be noted that the EU does not attempt to enforce this obligation. Sweden has not joined since the currency was created in 1999; Poland, Hungary and the Czech Republic have not joined since 2004, when they acceded to the EU; and Romania, Bulgaria and Croatia have not joined either.

As for the deficit criteria, there is a requirement of 3% of GDP in order to join the single currency. But that is not a requirement to join the EU. Otherwise why have so many new Member States not simply joined the single currency soon after EU membership?

In any event, this is easily provable: the Commission’s monitoring report on Croatia joining the EU noted that it had 4% and 5% deficits* in the years just before joining the EU. But its membership was still approved.

Of course, a large deficit is going to cause a country other difficulties besides EU membership, and in the event of EU membership the rule is in principle that a country should aim for deficits less than 3% of GDP after joining. But this rule is not absolute and the EU has little means to enforce it: sanctions for breaching it can only be imposed upon Eurozone countries, and the EU has never imposed them anyway. There would be strict conditions imposed upon any bailout deal (if necessary), inside or outside the Eurozone – but that would also apply outside the EU, for countries that need a bailout from the IMF alone. Whether Scotland might have an unmanageable deficit is certainly an important issue – but it’s quite false to say that “it can’t join the EU unless its deficit is less than 3%”.

Photo credit: Daily Record

Barnard & Peers: chapter 27

*amended to correct "debts" to "deficits", 10 May 2021

Scotland's Place in Europe: Comments on the Scottish Government's new proposals

Professor Steve Peers

Today, the Scottish government published its long-awaited discussion paper on ‘Scotland’s Place in Europe’. Although, as the paper points out, that government supports both EU membership and Scottish independence, the paper focusses on what should happen in the event of Brexit with Scotland remaining part of the UK. It would therefore be quite dishonest for anyone to dismiss the paper as simply ‘rejecting the referendum result’ (either the Brexit or the Scottish independence referendum result) or as ‘banging on about independence’.

So what does the paper propose? Essentially it discusses two options: a) a UK-wide approach to Brexit that would address the concerns of Scottish voters (among others); and b), failing that, a distinct approach for Scotland. It also makes c) the argument for further devolution of powers within the UK in light of the Brexit process. I’ll address mainly points a) and b), although there’s a necessary link between b) and c) – ie a distinct approach for Scotland/EU relations post-Brexit would more obviously require further devolution. Some of this ground is covered in a previous blog post, but it makes sense to revisit the issues in light of the new paper.

UK-wide response to Brexit

The paper primarily argues that the UK should stay in the EU’s single market as extended to non-EU countries like Norway and Iceland, in the form of the European Economic Area (EEA) treaty. It also argues that the UK should remain inside the EU’s customs union, which governs EU trade relations with non-EU states. As the paper rightly points out (at para 104), these are two separate issues – it would be possible to join one but not the other. It’s sometimes argues that being part of the single market entails being part of the customs union, but this is false, as the case of Norway (in the single market, but not the customs union) and Turkey (in the customs union, but not the single market) indicate. Although to date no non-EU state is part of both the single market and the customs union, there is no legal reason this cannot take place.

While it’s sometimes argued that staying in the single market is the same as staying in the EU, and would therefore be a rejection of the referendum result, this is false. As already noted, the EEA agreement doesn’t include the customs union, so the UK would be free to reach trade agreements with non-EU countries. It also does not extend to issues such as fisheries and agriculture (as the Scottish government paper points out), as well as EU foreign and defence policy, tax, and justice and home affairs issues. Norway and Iceland have agreements with the EU on some of these issues, such as participation in the Schengen open borders deal, but these are separate from EEA membership.

Today’s paper tackles a number of the objections to EEA membership.  It correctly notes (at para 100) that EEA membership does not mean being subject to the jurisdiction of the European Court of Justice (ECJ), which is a ‘red line’ for the UK government. However, it does mean being subject to the jurisdiction of an EFTA Court, which usually follows the ECJ where a case concerns an issue within the scope of the EEA treaty. It should be remembered, though, that some EFTA Court judgments (those following references from national courts) are not binding, unlike EU court rulings.

As regards the UK’s budget contribution to the EU, it points out correctly (at para 103) that contributions by non-EU EEA members are calculated differently (they don’t go straight to the EU budget, for instance), and may end up being less for the UK than at present. On the issue of immigration from the EU, the report fails to mention (at para 101) that a safeguard clause could be used to limit EU citizens coming to the UK. The Scottish government would have no interest in using this clause, but it could be invoked on a regional basis – for instance allowing screening of job applications from EU migrant workers at the employer level in England and Wales. While the report notes that non-EU EEA countries are consulted on new EU laws within the scope of the EEA, it doesn’t mention the possibility of non-EU EEA states rejecting the extension of those new laws to them.

Some things could be clearer in the report. There’s a list of areas besides trade where it advocates UK retains a strong relationship with the EU, but it’s not always clearly spelled out whether these are part of the EEA or not. For instance, private law (para 78), discrimination law besides sex discrimination law (para 79), EU funding to Scotland (para 89), research funding (para 92), refugee  issues (para 94) and criminal law (para 91) are outside the scope of the EEA, and so would need to be the subject of separate deals between the UK and the EU. Conversely, consumer law (para 79) and employment law (para 81) are within it. The report does make clear that many – though not all – EU environmental laws are inside the scope of the EEA (see para 93).

In particular, while the report advocates an interim arrangement for the UK leaving the EU, it does not suggest any details of what that might entail – and does not discuss the possibility, favoured by some ‘liberal Leavers’, that the UK could stay in the EEA only on an interim basis, pending negotiation of a comprehensive trade agreement.

Scotland-only approach

The report correctly notes that there is already geographical asymmetry (ie different application of the law in different parts of a country), not only in the application of EU law to parts of Member States and in the application of the EEA, but also in the UK’s planned response to Brexit. It proposes to follow the same approach to Scotland, which would participate in the EEA either via ‘sponsorship’ of the UK or directly (while still part of the UK).

This raises issues concerning the movement of goods or people between Scotland and the rest of the UK, if the two have different arrangements as regards relations with the EU. Some of these issues are discussed in detail in the paper, but it largely relies on arguing that whatever solutions are found for the Northern Ireland/Irish Republic border (as promised by the UK government) can be applied by analogy to relations between Scotland and the remaining UK.

Comments

The prospect of the UK staying in the EEA (or a comparable system) is legally much easier to arrange and negotiate than any Scotland-only approach to Brexit. However, as the report notes, EEA membership seems unlikely for political reasons, since the UK government seems unenthusiastic about any obligations regarding the free movement of people. On this point the report could have done more to address these concerns by discussing the possible use of the EEA safeguard clause. It could also at least have advocated participation in the EEA as an interim measure, given that the UK government in recent weeks has appeared increasingly open to the idea of some interim arrangement following Brexit in principle.  

Equally – although the report does not discuss this – a Scotland-only approach has political problems, as neither the UK government nor the remaining EU seem willing to discuss the idea.

However, the Scottish government might in theory have more success with its proposals relating to devolution. As it correctly notes, devolution issues are bound to arise once the Westminster Parliament examines the planned ‘Great Repeal Bill’ next year – since the conversion of EU law to UK law necessarily raises the question of how this process relates to the powers of the UK’s devolved governments. And on this issue, there is possibly more broad political support: the paper refers in particular to the interest of the Labour party in rethinking devolution, whereas that party does not seem interested in EEA membership for the whole UK and has not (to my knowledge) expressed any view on Scotland-only solutions for Brexit.

In this context, there is the prospect of a coalition of opposition MPs and rebel Conservatives with a number of common (and linked) concerns about the future Bill: ruling out lower standards for environment and employment law, addressing concerns of the devolved legislatures, and limiting the executive’s power to amend Acts of Parliament to reduce standards.

Beyond that is the specifically Scottish political context. If the Scottish government’s proposals on all three issues are rejected by the UK government – given the willingness of today’s report to accept both Brexit and Scotland remaining in the UK – this might be the occasion to argue that a further referendum on Scottish independence is justified, although other factors (such as opinion polling) will also play a big role in that decision.

Barnard & Peers: chapter 27

Photo credit: Business for Scotland

Scotland and Brexit: Brave Heart or Timorous Beastie?

Steve Peers

At the Scottish National Party (SNP) party conference yesterday, Scotland’s First Minister (Nicola Sturgeon) announced that the Scottish Government would issue a draft of a second independence referendum bill next week. She also announced that the Scottish government would soon table an alternative plan “to protect Scotland’s interests in [the EU] and keep us in the single market – even if the rest of the UK decides to leave”. This would entail “substantial additional powers for the Scottish Parliament”, namely all the Scottish powers that “currently lie with the EU – and significant new powers”, namely the power to negotiate international treaties and “greater powers over immigration”. 

Implicitly the Scottish government is offering the UK government a choice: negotiate to ensure that Scotland stays in the single market as a distinct part of the UK, or face another independence referendum. I’ll examine the legal issues arising from these two options in turn, and conclude with some broader observations about the Brexit process compared to the prospect of Scottish independence.

Scotland in the UK – and the single market

Is EU single market participation possible if a) Scotland stays in the UK, and b) the UK as a whole is not in the single market anymore? Some people have called this prospect a ‘reverse Greenland’, referring to the deal whereby Greenland left the EU but Denmark stayed in. Given the huge differences between Greenland and Scotland, I suggest we call this idea by a different name: say the ‘Scottish Economic Area’. I have written about this prospect separately in iScot magazine, but I will summarise my points again here.

Only independent countries which are EU members can fully participate in EU membership. But in theory at least, a part of a non-EU country could participate in the internal market, even if the rest of that non-EU country did not. Of course, the EU and the UK’s Westminster government would have to consent to this in as part of their post-Brexit treaty, and it could only work if there was significant related devolution to Scotland, as the First Minister suggested.

What would it mean in practical terms? The ‘single market’ consists of the free movement of goods, services, persons and capital, which includes the freedom of establishment of companies and the self-employed. To facilitate all this, there’s extensive EU legislation setting common standards for many industries. The single market also includes common rules on competition law and state aid to industry. But a number of rules on other matters (such as trade with non-EU countries) are not necessarily part of it. Full participation in the single market goes further than a free trade agreement with the EU which the Westminster government currently seems likely to prefer, as it will abolish more non-tariff barriers to the trade of goods and services. For instance, most free trade agreements don’t give as much access to financial services markets as single market participation does. So if Scotland is in the single market and the rest of the UK is not, more financial services businesses may stay in Edinburgh, or move from London to Edinburgh rather than to the EU.

Is this feasible in practice though? The easy part would be applying EU laws in Scotland which only have domestic effect, like consumer, environmental and labour law.  When it comes to laws with a cross-border effect on trade between Scotland and the EU, such as financial services market access, it would be necessary to define exactly when a firm was based in Scotland (benefitting from single market participation in the Scottish Economic Area), and when it was based in the rest of the UK (subject to a less favourable trade agreement).

The most difficult issues relate to movement of goods and people. Would different rules on Scottish/EU relations compared to the relations between the EU and rest of the UK mean that there would need to be border controls between Scotland and the rest of the UK? On this point, the Westminster government has promised there will be no border controls between Northern Ireland and the Republic of Ireland, even though that border will become an EU/non-EU border.  Surely whatever deal is reached to this end could be adapted for use at the Scotland/England land border too.

The Scottish government would not have a direct role in EU decision-making. But it could be given the same role as Norway and Iceland have in their single market treaty with the EU (discussed further below): consultation on proposed EU laws, the power to reject them (although that’s subject to the risk of retaliation), and participation in the EFTA Court that decides on single market disputes as regards Norway and Iceland. 

The suggestion above is undeniably complex, although the whole Brexit process is complex anyway. However, the idea isn’t all or nothing: it would be possible in theory for Scotland to participate fully in parts of the single market, rather than all of it like Norway and Iceland.

Independent Scotland

There are two possibilities here: a) Scotland as a member of the EU, and b) Scotland as a non-member of the EU, but with a close relationship with it – possibly closer than the remaining UK (rUK). It is also possible that the latter option could be an interim step towards full EU membership. Obviously any new independence referendum raises issues besides Scotland’s relations with the EU, but I will focus on that point.

Scotland as an EU Member State

I blogged on this issue in 2014, during the Scottish referendum, but I’ll summarise and elaborate on those views again. The basic point is that the Treaties list the Member States by name, and since the ‘United Kingdom’ is unlikely to be interpreted as automatically referring to Scotland alone, either an accession Treaty or a Treaty amendment is necessary to include Scotland’s name as a member. In the past an accession treaty (as provided for in Article 49 TEU) has always been used to add a new name; this would entail a negotiation process, which could possibly be fast-tracked in light of Scotland’s existing de facto EU membership as part of the UK.

However, that would raise awkward questions, since the EU usually requires new Member States to apply Schengen and the single currency, and might be unlikely to extend a share of the UK’s budget rebate to Scotland. Having said that, a number of Member States have got away with not applying the single currency in practice.  It should be noted that the ‘deficit criteria’ which apply to joining the single currency are not applied as a condition of EU membership, but only when a Member State subsequently applies to join the single currency itself.

The alternative route to membership is by Treaty amendment (as provided for in Article 48 TEU), which could also entail an amendment to Article 49 TEU to refer to the special case of Scotland: “By way of derogation from the above paragraphs, Scotland shall accede to the European Union pursuant to the Treaty of Culloden”.  One possibility is a Treaty amendment which simply replacing the words “United Kingdom” wherever it appears in the Treaties with “Scotland”; this would mean that Scotland retained the UK’s opt-outs from the single currency, justice and home affairs and Schengen (the rebate is set out in secondary legislation).

When I suggested this possibility on Twitter a few months back, it was ridiculed by some as a “Tippex” approach to amending the Treaties. But as a matter of legal drafting, it is perfectly feasible, and there is a firm precedent in the Treaty of Lisbon, which in Article 2(2) to 2(8) provides for a whole host of amendments just like this: replacing “Community” with “Union” wherever it appears, for instance.   

Undeniably, however, either approach requires unanimity between Member States, and so there would be a political risk that accession or amendments are not easily agreed. In particular, some have argued that there is a risk of a Spanish veto, because of concerns that Scotland obtaining easy EU membership would inflame separatist tensions in Spain or other countries. On the other hand, some have argued that these concerns are misplaced. Either event also raises timing issues: what happens if Scotland is independent before or after Brexit, but is not yet immediately an EU Member State? The gap could be filled, at least in the interim, by some other arrangement between Scotland and the EU – an issue to which I now turn.

Scotland as a non-EU Member State

The most obvious route for Scotland to consider would be membership of the European Economic Area (EEA), along with Norway, Iceland and Liechtenstein. The EEA provides for participation of these non-EU countries in the EU’s single market freedoms and all the EU legislation related to them, as well as most EU employment and environmental law. But Scotland would not be covered by EU laws in other areas, notably agriculture, fisheries, tax and justice and home affairs – although, like Norway and Iceland, it could sign separate treaties with the EU on these issues. Although the current EEA countries have joined Schengen, this is a separate issue (agreed years after the EEA), and Scotland would have no legal obligation to do the same.

There would be no obligation to join the EU single currency, and most significantly Scotland would be free to sign separate trade agreements with non-EU countries, because the EEA does not cover the EU’s customs union. This is particularly important because it means Scotland could seek to retain a closer economic relationship with the rUK than the rUK might have with the EU. Scotland could also “go global”, as Brexiteers say, by signing up to the free trade treaties already signed by members of the European Free Trade Area (EFTA: the EEA states plus Switzerland) with non-EU countries. And it would retain power to sign its own treaties on top (or to seek to retain its own versions of the EU’s free trade deals with non-EU countries, as the rUK is likely to do). Scotland would have to become a separate WTO member, but could try to fast-track this by copying the rUK’s process of detaching from the EU’s WTO membership.

Is there a downside to EEA participation? Some have argued against the UK joining the EEA due to objections to single market participation, the need to accept ECJ jurisdiction, continued contributions, its undue size compared to other members, or its lack of influence over EU laws which would apply to it. Are these arguments transferable to Scotland? The first to third objections are not, since Scots voted to remain in the EU, entailing the single market, ECJ jurisdiction and budget contributions anyway. (In fact, the non-EU EEA countries are not subject to the jurisdiction of the ECJ, but a separate body called the EFTA Court: it usually follows ECJ case-law, but its decisions are not always binding. EEA financial contributions do not go straight to the EU budget, and would logically be recalculated in light of Scotland’s economic position anyway).

The fourth objection (size) is unconvincing: Scotland is broadly comparable with Norway, in particular in terms of population, location and economy. Finally, EEA states have a modest say on EU laws, being consulted on draft EU legislation and having the option to reject the application of new EU laws (although the EU might retaliate if they do that). Anyway, this is certainly more say over EU laws than Scotland would get after Brexit as part of the UK. In fact, it’s more say than Scotland gets over EU laws while the UK is an EU Member State – given the marginal influence that Scotland has over anything that the UK government does.

So the EEA option includes things that Scotland seeks (single market participation) while steering clear of things it may wish to avoid (the single currency and deficit criteria, Schengen, EU trade policy with non-EU countries, and EU fisheries policy).  It also has the advantage of being potentially speedier: the EU can decide to apply treaties with non-EU countries provisionally, pending national ratification.

What about the prospect of a ‘Spanish veto’ over Spain joining the EEA? Here we have actual evidence to suggest that it’s not very likely. For the EU has recently concluded an association agreement with Kosovo – despite Spain (and four other Member States) refusing to recognise the independence of that country after its unilateral declaration of independence. (Note: the EEA is also an association agreement, and Member States have a veto over the initial conclusion of such treaties).

Failing EEA membership, Scotland could still seek other forms of relations with the EU which may be closer than the rUK might enjoy, possibly as a non-EEA member of EFTA like Switzerland. Unless Scotland followed Turkey in joining the EU’s customs union, this would again leave it free to simultaneously retain a strong economic relationship with the rUK.

Scottish independence and Brexit

Could the Brexit process be relevant for the Scottish independence debate – by analogy, or a part of a broader political dynamic? Certainly many of the arguments of Brexiteers – now taken over by the whole Westminster government – could be easily adapted to the Scottish debate. For instance, independence would allow Scots to ‘take back control’ of far, far more of their laws and finances than leaving the EU will do for the UK.

We can also make direct comparisons with certain issues. Does Scotland have a veto on UK tax laws, like the UK does in the EU? No. Does Scotland agree to over 90% of laws passed in Westminster, like the UK does in the EU? No. Does Scotland have a veto on UK defence policy, like the UK does in the EU? Hell, no.

The impact of Brexit on the UK economy can be argued both ways. If Brexit seems to be benefiting the UK, then arguably this shows Scottish independence is unnecessary; but equally it arguably shows that it could also be painless. If Brexit seems to be hurting the UK, then arguably this shows Scottish independence is needed to escape; but equally it arguably shows that independence could be even more painful.

It’s certainly now ridiculous to argue (as it was in 2014) that Scotland should stay in the UK if it wants to stay in the EU. Leaving the UK won’t automatically mean joining the EU, as discussed above; but staying in the UK now certainly means leaving the EU. While independence will likely be disruptive, Brexit will entail disruption anyway, so it’s now arguable which is the ‘riskier’ and which the ‘more stable’ choice. The plummeting pound may no longer be quite so attractive a currency to retain.

Adapting the words of Brexiteers, the rUK would have an economic incentive to quickly reach new trading arrangements with Scotland. And if they refuse to, as an attempt to punish Scots, then, again in the Brexiteers’ own words, who would want to stay in a Union that treats you like that?

Given the changes in the UK since 2014, there is a strong case that another independence referendum is justified. How would Scots have voted then, if they knew that a “Yes” vote would lead to “hard Brexit” in a few years’ time?

As things stand, the current UK government has not suggested any new devolved powers for Scotland, and still less any fundamental change to the UK’s constitutional structure. It has promised to consult the Scottish government over Brexit, but not to provide for differential links with the EU. It has prioritised a very low net migration target over the country’s economic interests; it has refused to allow control by the Westminster parliament (never mind Holyrood) over the form that Brexit takes; it treats EU citizens in the UK as “bargaining chips”; and it aims to slash foreign students, expel foreign doctors and (at one point) to name and shame employers of foreign workers. It has made no attempt to reach out to the large minority of British voters – and the large majority of Scots – who voted “Remain”. Quite the reverse: its media allies refer to critics of Brexit as traitors who should be silenced and imprisoned.

If there is another referendum, Scots will have to decide if they would still be “better together” under these circumstances.  

Barnard & Peers: chapter 27

Photo credit: http://www.businessforscotland.co.uk/an-independent-scotland-would-get-a-better-deal-from-the-eu/