Thursday

23rd Feb 2017

May extends Brexit olive branch

  • May (l) with Sturgeon - Scottish leader prepared to call independence referendum (Photo: First Minister of Scotland)

British prime minister Theresa May is to launch new Brexit talks with Scotland, Northern Ireland, and Wales, as nerves fray, also among banks, at the prospect of a rupture from the single market.

The talks are to take place in a parliamentary subcommittee, called the “joint ministerial committee (EU negotiations)”, to be chaired by May’s Brexit minister David Davis.

Dear EUobserver reader

Subscribe now for unrestricted access to EUobserver.

Sign up for 30 days' free trial, no obligation. Full subscription only 15 € / month or 150 € / year.

  1. Unlimited access on desktop and mobile
  2. All premium articles, analysis, commentary and investigations
  3. EUobserver archives

EUobserver is the only independent news media covering EU affairs in Brussels and all 28 member states.

♡ We value your support.

If you already have an account click here to login.

  • Good Friday pact at risk if UK leaves EU, McGuinness said (Photo: Miss Copenhagen)

May is to meet the Scottish, Northern Irish, and Welsh leaders in London on Monday (24 October) to launch the process.

The subcommittee is to meet by the end of November and “at least” one more time before Christmas, prior to the start of EU exit negotiations at the end of March.

“The great union between us has been the cornerstone of our prosperity in the past - and it is absolutely vital to our success in the future,” May said in a statement.

She said the new forum would give the devolved governments a “direct line” to Davis in order “to help shape the UK’s EU exit strategy”.

“Contrary to some speculation, no final decisions have been taken and how the UK leaves the EU will not boil down to a binary choice,” she said, referring to the choice of staying in the EU market, and accepting EU migrants, or breaking off EU relations in what some have called a "hard Brexit".

People in Northern Ireland and Scotland voted to stay in the EU in the June membership referendum.

Writing in an opinion article in the Financial Times newspaper on Monday, the Scottish leader, Nicola Sturgeon, said she wanted a “flexible Brexit” in which Scotland could retain EU ties even if England and Wales went for the hard option.

“I accept that there is a mandate to take England and Wales out of the EU, I do not accept there is any such mandate to take any part of the UK out of the single market,” she said.

Constitutional crisis?

She renewed her threat to hold a second referendum on Scottish independence if need be, adding: “Scotland must be able to consider independence if it becomes clear that it is the best ... way of protecting our interests”.

Martin McGuinness, the deputy first minister of Northern Ireland, said on Sunday that “any attempt to drag the North out of the EU” could undo the so-called Good Friday accord that ended the sectarian conflict there.

“I will make clear … the democratic imperative to recognise and respect the vote in the north to remain in the EU,” he said.

Carwyn Jones, the Welsh leader, said he would not accept any deal that included EU tariffs on Welsh-made goods.

He also said that the Welsh parliament should vote on May’s Brexit strategy prior to her launch of EU negotiations.

The threat of the UK breaking up due to Brexit reared its head immediately after the June referendum.

The British think tank, the Institute for Government, in a report published on Monday, also warned that unless May struck a deal with the devolved powers, then it could cause “a serious breakdown in relations between the four governments”, leading to a “full-blown constitutional crisis”.

The threat of firms relocating from the City of London to EU financial centres such as Dublin, Frankfurt, or Paris also hangs over May’s government.

Quivering hands

Writing in an opinion article in The Observer newspaper on Sunday, Anthony Browne, the head of the British Bankers’ Association, a pressure group, said CEO’s hands are “quivering over the relocate button”.

“Delegations from Frankfurt, Paris, Dublin and Madrid are all coming to the UK to pitch to bankers”, he said.

“Many smaller banks plan to start relocations before Christmas. Bigger banks are expected to start in the first quarter of next year”, he added.

Browne said that a hard Brexit amounted to a “cliff edge” for banks, in which their £20-billion (€22.5bn) a year business of selling services to Europe became “illegal” the day the UK left.

London-based firms currently sell services to the EU under so-called “passporting rights”.

If these were lost, they could keep doing it under a so-called “equivalence regime”, which would cover selected services only and which, in Browne’s words “can be withdrawn at virtually no notice and will probably mean the UK will have to accept rules it has no influence over”.

“For most banks, having equivalence won’t prevent banks from relocating their operations”, he said.

May struggles to contain Brexit angst

Government under fire from Scotland and from opposition MPs for "chaotic" Brexit preparations, despite May's new committee and pledge on parliament debates.

News in Brief

  1. Report: Commission gauging EU support for Poland sanctions
  2. Irish PM expected to quit amid police scandal
  3. After Brexit vote, 100,000 UK firms registered in Ireland
  4. Bayrou to support Macron in French presidential election
  5. British by-election tests Ukip strength after Brexit
  6. Romanian parliament buries controversial corruption decree
  7. Dozens drown off Libyan coast
  8. EU ministers approve anti-tax avoidance directive

Stakeholders' Highlights

  1. QS World MBA TourMeet with Leading International Business Schools in Paris on March 4th
  2. Malta EU 2017Economic Governance: Agreement Reached on Structural Reform Support Programme for Member States
  3. Socialists & DemocratsWomen Have to Work Ten Years Longer to Match Lifetime Earnings of Men
  4. Counter BalanceTrans-Adriatic Pipeline Is a Major Risk for Banks, Warns New Analysis
  5. Martens CentreEU and US Migration Policies Compared: Join the Debate on February 28th
  6. Swedish EnterprisesTechnology and Data Flows - Shaping the Society of Tomorrow
  7. UNICEFNearly 1.4 Million Children at Risk of Death as Famine Looms Across Africa and Yemen
  8. Malta EU 2017End of Roaming Fees: Council Reaches Agreement on Wholesale Caps
  9. Nordic Council of MinistersNordic Innovation House Opens in New York to Help Startups Access US Market
  10. Centre Maurits CoppietersMinorities and Migrations
  11. Salzburg Global SeminarThe Child in the City: Health, Parks and Play
  12. UNICEFNumber of Ukrainian Children Needing Aid Nearly Doubles to 1 Million Over the Past Year

Stakeholders' Highlights

  1. Centre Maurits CoppietersThe Situation of Refugee Women in Europe
  2. Salzburg Global SeminarToward a Shared Culture of Health: Charting the Patient-Clinician Relationship
  3. European Free AllianceAustria Should Preserve & Promote Bilingual and Multinational Carinthia
  4. Martens CentreShow Your Love for Democracy! Take Part in Our Contest: "If It's Broken, Let's Fix It"
  5. CISPECloud Computing Leaders Establish Data Protection Standards to Protect Customer Data
  6. Malta EU 2017Landmark Deal Reached With European Parliament on Portability of Online Content
  7. Belgrade Security ForumBSF 2017: Building a Common Future in the Age of Uncertainty
  8. CESIEU Not to Revise the Working Time Directive
  9. International Partnership for Human RightsAzerbaijan: 76 NGOs Urge the EU to Use President's Visit to Insist on Human Rights Reforms
  10. UNICEFDeadliest Winter for Migrant Children Crossing the Central Mediterranean
  11. World VisionGaza Staff Member Pleads Not Guilty
  12. Nordic Council of MinistersNordic Region First to Consider Complete Ban on Microplastics in Cosmetics