EU referendum: your step-by-step guide to how Brexit would play out

Written by Dr Alan Renwick, UCL Constitution Unit on 23 June 2016 in Analysis
Analysis

As Britain heads to the polls to vote on the the UK’s membership of the European Union, the result seems impossible to predict. But many are asking what, in practical terms, would happen if the country votes to leave. Here, Dr Alan Renwick of the UCL Constitution Unit gives a point-by-point overview of what the road to Brexit might look like

What would be the immediate impact of a Leave vote?

We will not immediately leave the EU if the result on 24 June shows a majority for Brexit. Indeed, in purely legal terms, the referendum result has no effect at all: the vote is advisory, so, in principle, the government could choose to ignore it. In political terms, however, ministers could not do that. We should presume that a vote to leave means that we will leave (see point 16) — though there is scope for various complications along the way.


More on the EU referendum
EU Referendum: Britain heads to the polls for historic vote
Leave or Remain, what will the EU referendum really mean for the civil service?
EU referendum: What are the lessons for political communicators from the Leave and Remain camps?


David Cameron (pictured) would very likely announce his resignation quickly, but would stay in post until his successor was chosen. There is much speculation that the prime minister would be out of Downing Street within days, and it is true that his position would probably become untenable. 

But the Cabinet Manual is clear (at paragraph 2.10) that he cannot go until he can advise the Queen on who should form the new government. 

Conservative party rules set out a two-stage leadership election process: first, the parliamentary party, through successive ballots, whittles the field down to two candidates; then the party membership, by postal ballot, chooses between these. Recent experience suggests this would take two to three months.

How will withdrawal happen in practice?

Following a vote for Brexit, a period of negotiations about the UK’s future relationship with the EU would begin, as set out in Article 50 of the Lisbon Treaty. 

The prime minister triggers this by notifying the European Council (the collective body of the 28 member states’ prime ministers or presidents) that the UK intends to withdraw. That opens a two-year window for negotiating withdrawal terms — a period that can be extended, but only with the unanimous support of all the member states. 

We leave once a deal — which requires the support of the UK and a “qualified majority” of the remaining 27 member states (specifically, 20 of them, comprising at least 65 per cent of their population) — is struck. If the two-year period comes to an end with neither a deal nor an extension, we leave automatically on terms we may not like.

Article 50 skews the balance of power in the negotiations in favour of the continuing member states. That is because of the two-year rule and the unanimity requirement for extensions to that period. 

If we find ourselves outside the EU with no deal, we automatically revert to World Trade Organization (WTO) rules on trade. That means that tariffs have to be imposed on trade between the UK and the EU. This would be bad for everyone, but especially for the UK. Strenuous — and probably successful — efforts would be made to avoid it. But some other member states  would strike a very hard bargain. We can presume that the UK would not get its way on everything.

There is no requirement for the prime minister to trigger Article 50 immediately after a vote for Brexit. It would be sensible for the UK to work out its negotiating position and construct its negotiating team before setting the clock running. The government might also hope to hold preliminary discussions with other member states — though how far they would be willing to engage at this stage is unclear. At the same time, given the damaging effects of uncertainty, there would be strong reasons for avoiding too long a delay.

It is vanishingly unlikely that the UK could withdraw without triggering Article 50 at all. Vote Leave suggests that it might be possible to leave via Article 48, which sets out the procedure for revising EU treaties. But a simple majority of member states could block even a request to consider such a route, and the amendments themselves would require ratification by every member state. 

Given that the Article 50 process skews the balance of power towards the continuing member states, we can presume they would insist on its use.

Both sides in the referendum campaign agree that this whole process would take several years, during which the UK would remain in the EU. 

The Remain side has always argued that the negotiations would be lengthy; the Leave side has now indicated that it would like to complete the process by 2020. 

Until the negotiation process is complete, the UK remains fully subject to its obligations under EU law. Thus, while Vote Leave says it would introduce measures early in the withdrawal process to limit the writ of the European Court of Justice, doing so could violate the law.

So what will be in those negotiations?

The process of withdrawal would involve three sets of negotiations.

First would be the negotiation of the withdrawal terms themselves. These would likely include, for example, an agreement on the rights of UK citizens already resident in other member states and of EU citizens resident in the UK. Those rights — contrary to what some have said — are for the most part not protected under existing international law.

Second, it would be necessary to negotiate a trade deal with the EU. The official Vote Leave campaign has confirmed that it wants such a deal and correctly points out that everyone’s interests would be served by having one. 

"The UK would not be allowed just to "cut and paste" the terms of World Trade Organisation" membership that it currently has through being in the EU"

The content of the deal would, however, be hotly contested. Vote Leave focuses on securing free trade in goods and argues that, because the UK imports more goods from the EU than it exports to the EU, we could expect to be offered a good deal. But there would be greater difficulties in services. 

Open Europe (which campaigns for EU reform and is neutral in the referendum) highlights particular difficulties in financial services, where it rates the chances of maintaining current levels of access to the EU as “low”.

Third, the UK would have to negotiate the terms of its membership of the WTO and would want also to negotiate trade deals with the over 50 countries that currently have such deals with the EU, as the existing arrangements will no longer apply to the UK from the moment of Brexit. 

The WTO itself has warned that this would not be straightforward: the UK would not be allowed just to "cut and paste" the terms of WTO membership that it currently has through its EU membership. Similarly, while we might hope that other countries would agree quickly to extend the EU rules to the UK, we cannot presume that all would — and the UK itself might want different terms in some cases.

These negotiations could run in parallel, or the UK could negotiate withdrawal first and future arrangements later. As Professor Adam Lazowski has pointed out, there are difficulties in both approaches.

Could parliament influence the process?

Parliament has no formal say over whether or when Article 50 is invoked, as this lies within the royal prerogative powers that are exercised by government. Government’s powers in matters of foreign policy are very extensive, and parliament has veto rights only in respect of treaties. 

If parliament were to pass a motion calling on the prime minister not to invoke Article 50, we might nevertheless expect him (or perhaps, by then, her) to respect that. But the prime minister could claim the authority of the popular vote to justify ignoring such pressure.

Parliament would, however, be able to vote on the withdrawal deal, as that would be a treaty. Indeed, parliament would expect to be updated regularly on the negotiations and to have its views heard, perhaps through votes on specific issues. 

A large majority of current MPs favour staying in the EU. If they wanted a post-Brexit deal involving substantial ongoing integration with the EU — perhaps akin to Norway’s arrangements ­— they could potentially have the power to reject any deal that did not provide that. Whether they would do so would depend in part on the political situation and the state of public opinion at the time, both of which are highly unpredictable. It would depend also on the withdrawal timetable: if the two-year window were near to closing, rejecting the deal on the table could be very risky.

Beyond the negotiations, parliament would also have a great deal of legislating to do. Withdrawal would require repeal of the European Communities Act (ECA) of 1972 — the legislation that underpins the UK’s EU membership. 

But there would also be two much larger tasks. First, a great deal of legislation has been passed over the last forty years that enacts provisions required under EU membership. Parliament would presumably wish to review — and in places amend or repeal – this body of law during or following withdrawal. 

Second, EU “regulations” apply directly in the UK without domestic implementing legislation and would automatically cease to apply upon repeal of the ECA. 

But it would be essential to retain some of these, at least in the short term: otherwise, we would lack rules on many important matters. 

Agata Gostyńska-Jakubowska, a research fellow at the Centre for European Reform, points out that much of the trading done in the City of London would overnight become illegal unless new provision were made. The process of reviewing this legislation — working out what to keep, what to amend, and what to remove — would be lengthy, complex, and contested.

Could the civil service cope?

Whitehall, meanwhile, would be severely stretched by the mammoth exercise of withdrawal. The civil service has zero spare capacity after the cuts of the last five years: many departments have seen budget cuts of over a quarter since 2010, and total civil service employment has fallen by almost a fifth in the same period. Further spending reductions for the coming years were set out in last year’s Spending Review. 

The UK has no current capacity at all in trade negotiations, as this is a job that has been outsourced to Brussels. The task of reviewing 40 years of EU and domestic legislation could take five or ten years. It would make it very difficult for the government to embark on any new policy while it reviews all these old policies. Whitehall also risks becoming very clumsy in handling important relationships (such as with Scotland: see below) because it would be so severely distracted.

What about Scotland and Northern Ireland?

Scotland’s position within the UK would probably become even more contested. The polls suggest that, if the UK votes for Brexit, that will reflect the result in England and (probably) Wales: the Remain side is well ahead in Scotland and Northern Ireland. This would inflame nationalist sentiment in Scotland. There is widespread speculation that it would lead to a second independence referendum. That is indeed possible. 

However, Scottish first minister Nicola Sturgeon would not move quickly: she has said that she will call a second referendum only if polls consistently show substantial majority support for independence. Brexit would in some ways make independence harder: not least, the combination of the two would create an EU border between Scotland and England. The outcome could therefore be that Scotland becomes less satisfied with the UK but more locked into it.

This sense of grievance could be further aroused by the process of withdrawal itself. The Scottish Parliament, Welsh Assembly, and Northern Ireland Assembly are all legally required to operate within EU law. In order to withdraw from the EU cleanly, these requirements would have to be repealed. By convention, this would require the consent of the devolved legislatures, which they might well refuse to grant. 

Sionaidh Douglas-Scott of Queen Mary University has argued that Westminster could precipitate a constitutional crisis if it chose to override such refusal. Some others doubt that. Nevertheless, it would add to the sense in Scotland that London is breaking the promises it has made to the Scottish people.

There are concerns in Northern Ireland that Brexit would undermine the peace process. As the Constitution Unit’s briefing paper on Brexit and devolution also explores, the EU has long been involved in the peace process and gives substantial funding to peace initiatives. 

Furthermore, experts in both the North and the Republic question whether the existing Common Travel Area between the UK and Ireland could be maintained following Brexit, which would require imposition of a ‘hard border’. The great achievement of the last 20 years has been to remove the border as an issue in Northern Irish politics; its reintroduction would fuel insecurities and threaten the stability and cohesion of the power sharing arrangements.

Could there be a second referendum?

There is no easy route to a second referendum. There has been much speculation around the question of whether a second referendum to finalise our future relationship with the EU could be held. 

Various kinds of second referendum can be imagined, but all face considerable difficulties. One idea, floated last year by Boris Johnson and revived this week by the Sunday Times, is that we might take a referendum vote to leave as an opportunity to negotiate not Brexit, but rather radically revised terms of ongoing membership. In the wake of a public vote specifically for Brexit (unless perhaps the margin is very tight), however, it would be politically very difficult for any prime minister to pursue such a path. 

Another idea is a vote on the terms of the Brexit deal once they have been negotiated. The alternative to accepting the deal might either be that we stay in the EU after all or that we go back and try to negotiate something better. 

The trouble with both options is that they are legally perilous: Article 50 provides no mechanism for withdrawing a notification of intent to leave the EU, and the two-year limit means that, if we rejected a deal, we could find ourselves on the outside by default. 

In practice, some way round these difficulties might well be found — but the UK might have to make significant concessions to get there. So, while scenarios leading to a second referendum are conceivable — such as if government and parliament are at loggerheads over the terms of the deal — we should presume that leave means leave.

About the author

Dr Alan Renwick is deputy director of the UCL Constitution Unit. A version of this post first appeared on the Unit’s own blog, and is shared here with kind permission

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Sean Connolly (not verified)

Submitted on 27 June, 2016 - 13:29
Excellent balanced article. Can't believe there are no other comments.

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