STRATFOR ANALYSIS

London court writes another page in Brexit saga

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The latest development in the ongoing Brexit drama happened on Thursday [Nov. 3]. A court ruling in London that Parliament must approve before the Brexit can happen raised hopes among those opposing the United Kingdom’s departure from the European Union. In making their decision, British judges discounted arguments by lawyers for Prime Minister Theresa May, that she did not need lawmakers’ approval to invoke Article 50 of the Lisbon Treaty and begin the negotiation process for withdrawing from Europe.

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News of the decision lifted the pound sterling to its highest level in three weeks. This reflects the market’s belief that the Brexit could be derailed, or at least delayed. However, that optimism may be misguided.

While the court ruling undoubtedly complicates the process, it can expect to be appealed by the country’s Supreme Court, a process likely to begin in December. And even if the high court’s justices confirm the lower court’s decision, blocking the Brexit would be a politically risky maneuver for lawmakers. Immediately after the Brexit referendum, some politicians and analysts argued that since the vote was not binding, the British government could decide not to enforce it. But that would mean ignoring the mandate of roughly 52 percent of UK voters, who supported leaving the European Union. Though a majority of British lawmakers backed the “remain” camp, most of them represent constituencies that voted to leave. Moreover, vocal opposition to the Brexit is not as evident in the United Kingdom these days.

Britain’s main political parties, the ruling Conservative Party and the opposition Labour Party, were internally divided during the referendum campaign. But following the vote, each has adopted the official position that Brexit has to happen. May, who supported the “remain” side, now defends Brexit, and so does Labour leader Jeremy Corbyn. A challenger to the Labour leadership who proposed a second referendum failed to win enough support from the party to supplant Corbyn. As a result, the political debate in the United Kingdom has evolved from whether Britain should leave the European Union to what the withdrawal should look like.

This is not a minor evolution. While most British lawmakers have come to terms with the fact that voters demanded to leave the European Union, the referendum said nothing about terms of withdrawal. In recent weeks, British members of parliament demanded a greater say in negotiations with the European Union. And Thursday’s court ruling strengthens their claim. Lawmakers may demand reassurances from the government that Parliament will be involved in the negotiation process. This could delay May’s goal of starting proceedings by March 2017 — the process of writing the law to trigger the exit from Europe provides lawmakers the opportunity to introduce amendments that could slow down the process.

Greater involvement by Parliament in the Brexit would also shape the evolution of negotiations. As talks progress, the government will have difficult decisions to make on issues including membership in the European Union’s internal market, the future of London’s financial sector and the status of immigrants from EU countries. May and her Cabinet have said that restoring Britain’s full sovereignty on issues such as immigration takes precedence over membership in the internal market. But the government would have to negotiate on these issues simultaneously with the European Union and with pro- and anti-Brexit lawmakers at home. And Westminster’s original position could change under pressure from the various sides.

The British government has said that Parliament will get a vote on the final agreement, which means that its negotiators will have to produce a settlement with Brussels that is acceptable to lawmakers. Depending on when negotiations finish, the decision could be left to a new Parliament — the United Kingdom must hold general elections no later than mid-2020. Additionally, the final deal probably has to be ratified by each of the parliaments of the remaining 27 EU member states. This opens the door for a veto threat from any party involved.

Should an emboldened House of Commons make life difficult for the British government, May could decide to call early elections with the goal of creating a Parliament with a clear mandate on what to do regarding Brexit. Politically, this could be a good time for May to hold elections, considering her high popularity and the internal problems with which opposition parties, including Labour and UKIP, are grappling. The focus of a new election would probably be on the terms of Brexit, rather than on the question of whether it should be stopped. But it is also possible that the vote would be presented by some parties as a second referendum on Brexit.

The irony of Thursday’s ruling is that it gives the British Parliament a greater say on the Brexit process. Regaining the full sovereignty of Parliament was one of the main claims of the “leave” camp during the referendum campaign. Should the Supreme Court confirm the ruling, the United Kingdom’s empowered lawmakers will open new battlefronts for the British government and add yet another layer of complexity to the Brexit process.

© STRATFOR

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