Shameful Brexit Agreement

Grey World // CC

In the 19th century, when the Western powers made agreements with Qing China, these treaties were so disadvantageous for China that they came to be known as unequal treaties.

These treaties, among other things, dictated to China what customs tariffs it can set, gifted Chinese territory (Hong Kong) to Britain, and placed parts of land and some people under the jurisdiction of foreign courts.

In the end, the century of humiliation led China to embrace nationalism under Kuomintang first, and shortly thereafter, communism and Mao Zedong.

The European Union (EU) now wants the United Kingdom (UK) to accept a modern-day unequal treaty.

The British people voted to leave the European Union on June 23, 2016. Before the referendum, both campaigns stressed that leaving the EU meant leaving the Single Market, the Customs Union and the jurisdiction of the European Court of Justice (ECJ). This commitment was repeated by Prime Minister Theresa May many times after the referendum as well. What is the result?

585 pages long behemoth of a “divorce agreement” leaves the UK in the Single Market, in the Customs Union, under the jurisdiction of the ECJ, continues the primacy of EU law over UK law, commits the UK to payments to EU’s budget, leaves the UK in the common fisheries policy, de facto prohibits the UK to negotiate free-trade agreements with other countries, and so on and so forth.

What is worst about this treaty: it doesn’t give the UK the ability to exit it unilaterally.

In the words of the treaty, unless the UK and the EU agree on the extension of the transition period, Northern Ireland will automatically fall into a regime of an EU protectorate, with different rules applying to it than to the rest of the United Kingdom.

It is clear that this would be unacceptable for any UK government which will, therefore, always agree an extension. This Northern Ireland backstop is used as a weapon to force the UK to accept a never-ending extension, which would not be legal under Article 50 of the Treaty on EU (TEU) but would have to be negotiated under Article 218 TEU.

The problem is that Article 218 requires ratification by national parliaments. The make-believe transition, which would in fact be permanent, circumvents this ratification requirement because Article 50 only requires a strengthened qualified majority in the Council of Ministers and a consent of the European Parliament.

This divorce agreement is, therefore, even worse than the current arrangement according to which the UK is a member state of the EU. Even under the withdrawal agreement, the UK has to implement virtually all EU laws,  it would still be bound by the nonsensical EU customs tariff, which contains over 13 thousand items and makes purchases for European customers more expensive, but the UK will no longer have representatives in EU institutions and will not have a mechanism on how to exit this lopsidedly advantageous treaty.

The Treaty on EU can be unilaterally exited through the now-notorious Article 50. The withdrawal agreement cannot be exited unilaterally. The agreement even contains provisions (maybe illegal) that the only arbiter of disputes must be the arbitration panel as described in the agreement.

And this panel must , in fact, abide by the ECJ word for word, it is literally subservient to a court of one of the parties (EU) to the agreement. It is prohibited to try and settle any disputes at the international court at the Hague.

The EU is trying to force future UK governments into a dilemma whether they should continue with this disadvantageous arrangement or whether they should exit an unexitable treaty and thus violate their international obligations. One of the basic UK constitutional principles is that no parliament may bind a future parliament to do something it doesn’t want to do, and, therefore, this agreement is problematic within the framework of both international and UK law (if it were to be ratified).

Interestingly, the EU violates its own law here. Under Article 8 TEU: “The Union shall develop a special relationship with neighbouring countries, aiming to establish an area of prosperity and good neighbourliness.”

Article 21(2)(e) TEU, copying similar provisions from the General Agreement on Tariffs and Trade (GATT) of the World Trade Organization (WTO), states: “The Union shall […] encourage the integration of all countries into the world economy, including through the progressive abolition of restrictions on international trade.”

According to WTO agreements, a free-trade area (like the EU) cannot be operated in a way that would obstruct international trade. By constraining the UK into the customs union without having the ability to withdraw from it, this agreement prohibits the UK to have a trade policy and negotiate free-trade agreements with e.g. the US, Australia, India, or China. And this approach surely is not a mark of good neighborliness.

Carl Baudenbacher, a former European Free Trade Association (EFTA) Court President, stated: “It is absolutely unbelievable that a country like the UK, which was the first country to accept independent courts, would subject itself to this”.

Jacob Rees-Mogg, the Chairman of the European Research Group on the House of Commons, claimed that this treaty would make the UK a vassal state. It is difficult to not agree with him. The last treaties that gave jurisdiction to foreign courts were the aforementioned 19th-century treaties with China. They were called unequal treaties. One such treaty has been written by the European Union very recently.

It is absolutely shameful that other member states’ governments agreed to such a bad treaty that is being proposed on their behalf by the European Commission.

The United Kingdom is not a subjugated nation, nor has it lost the opium wars. It is our ally and many of us have friends and relatives among Britons. Member states should demand that the European Union propose a treaty in the name of good neighborliness and in good faith. A treaty that the UK will be able to accept.

In the meantime, we can only hope that the House of Commons will not accept the treaty on Brexit in its current form.

Martin Panek
Liberalni Institute