The European Union’s chief Brexit negotiator Michel Barnier has said that a no-deal, clean-break Brexit is still a possibility.
The EU-approved withdrawal treaty has passed its first hurdle through the House of Commons, and the European Council has agreed to a “flextension” to January 31st, 2020, for Parliament to make the agreement law.
Once on the British statute books, the United Kingdom would leave the EU and remain aligned to the bloc during a transition period until December 2020, before hopefully diverging from Brussels regulations and striking out as an independent nation.
Whilst it appears that a clean-break Brexit — an option which many Leavers support — is all but ruled out, Mr Barnier admitted during a speech in Brussels on Wednesday: “The risk of Brexit happening without a ratified deal still exists.”
“We still need to prepare,” he said in comments reported by Reuters.
He added that a no-deal could happen at the end of January if Parliament fails to agree on the treaty and the EU27 refuses to grant a further extension to Article 50. Prime Minister Boris Johnson has halted further debate and voting on the bill until after a snap General Election on December 12th.
Prime Minister Johnson wants to clear out the House of Commons of Brexit-blocking MPs, who threaten to water down and even stop Brexit altogether.
On Tuesday, President of the European Council Donald Tusk said that this extension “may be the last one”.
Mr Barnier continued that even if a no-deal does not happen at the end of the January 2020 extension, it could happen after December 2020 if Britain and the EU fail to agree on a future relationship during negotiations taking place in the transition period.
“It will be a difficult and demanding set of negotiations,” Mr Barnier said.
“The time we have at hand to conclude this negotiation will be extremely short, 11 months.”
“Because of our geographic closeness and our economic interdependence… we want to have solid guarantees on the level-playing field aspects,” he added.
EU bureaucrats and European countries have expressed concern that once free of Brussels’ regulatory constraints, the United Kingdom will lower taxes and deregulate to make itself more attractive to foreign businesses and investors — becoming, in German Chancellor Angela’s Merkel’s words, an “economic competitor at our door”.
Mr Barnier said that the EU would “keep a close watch and be extremely vigilant on… social rights, environmental protection, state aid, and obviously on issues of taxation”.
The Frenchman is not the only politician to predict that even with an agreed withdrawal treaty, a ‘no-deal’ could happen if the United Kingdom diverges from the EU at the end of the transition period, otherwise called the “implementation period”.
Remain campaigner and former prime minister Tony Blair predicted this week that “the likely outcome” of negotiations during the transition period “is No Deal”.
Mr Blair told the BBC: “Europe is now on notice from Britain and its ministers that Britain wants Brexit to compete around tax and regulation, to become an off-shore competitor with the European Union.
“What is absolutely clear is that Europe is not going to have that. They’re going to say to the UK side — this is why this negotiation is going to be very ugly and very difficult — they’re going to say, ‘No, we’re not giving you tariff-free access to our markets if you’re going to start using a whole lot of competitive tax and regulatory measures in order to undercut us’.”
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