This article is a summary of ‘Brexit: Legally Effective Alternatives’ by Paul Gallagher of the Institute of International and Economic Affairs, an independent, not-for-profit organisation with charitable status based in Ireland.
What legal routes and options can the UK rely on when asserting its demands in the current renegotiation?
The legal entitlement of Britain to withdraw is not an issue (see Article 50 TEU), but the terms of that withdrawal are and these are what create legal uncertainty (e.g. over access to the single market) in the event of withdrawal. Further, with regard to the British demand for concessions it may be that some of the concessions demanded would require a Treaty change. Due to a lack of political will it would not be possible to implement Treaty change by the time of the referendum, although it would be legally possible to do so using Article 48 TEU.
That said there is flexibility in the Treaties themselves, so an amendment may not be necessary, at least in respect of the majority of British demands. In respect of demands which could be satisfied by a clarification (as opposed to an alteration) of the EU Treaties, a Decision of the Heads of State or Government can provide legal guarantees as to the legal effect of the Treaties. This method was used after the 2008 Irish referendum, which initially rejected the Lisbon Treaty. Subsequently, the guarantees embodied in the Decision were attached to the Treaties in the form of a legally binding Protocol, which was ratified at the same time as the next Accession Treaty. The Protocol confirmed that matters of concern to the Irish People were unaffected by the entry into force of the Lisbon Treaty. The guarantees were worded in general terms, applied to all Member States, and clearly stated that the Protocol would clarify but not change either the content or the application of the Treaty.
Even without a subsequent Protocol, guarantees embodied in a free-standing decision of the Heads of State or Government binding in international law are legally secure. They would be irreversible without unanimity and could not be ignored by the CJEU. Guarantees cannot, however, be used to amend or enlarge the Treaties.
Specific British demands
A key demand of the UK Conservative Government is for no discrimination or disadvantage against any business on the basis of the currency of the country in which they are based, and recognition that the EU is multi-currency. The House of Commons European Scrutiny Committee (‘the Committee’) has expressed the view that this would require the legal certainty of a Treaty change. However, the recognition of multiple EU currencies is already explicitly acknowledged in the Treaties (see Article 140 TFEU and the UK Protocol).
Furthermore, non-discrimination is a fundamental principle of the Treaties and is enshrined in Article 21 of the Charter of Fundamental Rights and Freedoms.
While a more direct decision-making role in Eurozone matters could well require a Treaty change, it is not clear that this is what the UK is demanding.
On the issue of cutting ‘red tape’, the UK and the Commission share a common interest. The Committee believes that this can be achieved through secondary legislation.
Further assurances could be given by an endorsement from the European Parliament, or if absolutely necessary a Heads of State or Protocol guarantee.
The concept of “ever closer union” is provided for in Article 1 TEU, though the original emphasis is on union between the “Peoples of Europe”, not Member States.
The UK is concerned however that the CJEU will interpret this concept broadly. Although the words do not create any legal right or obligation the Court has used the concept as an interpretative tool of last resort (as in Pupino). The concept has been referred to very infrequently in rulings (less than 60 occasions out of over 3,000 rulings and opinions).
Again, a guarantee could be provided clarifying that the concept does not embody a commitment by Member States to further integration. Such a guarantee would not require Treaty change - though this depends on achieving agreement on the meaning of the concept. The European Council’s June 2014 Conclusions provide some guidance: “the concept of ever closer union allows for different paths of integration for different countries allowing those that want to deepen integration to move ahead, while respecting the wish of those who do not want to deepen it any further.”
Further assurance would come through the UK’s ‘red card’ demand - that groups of national parliaments could block unwanted legislative proposals. This would require an amendment to Protocol 2 on the Application of the Principles of Subsidiarity and Proportionality - although a less robust option could be strengthening the subsidiarity reasoned opinion procedure included in that Protocol.
Amongst other demands, the UK asks for a total ban on sending child benefit overseas, and a four-year delay before those coming to the UK from the EU qualify for in-work benefits or social housing. This potentially raises very fundamental Treaties issues.
Free movement and the social security rights required to make it meaningful are core EU values. The EU has broad-ranging Treaty powers to adopt measures in the field of social security in order to facilitate this principle (see Article 21(3), Article 153(1)(c), Article 48 and Article 79(1) TFEU, Article 34 of the Charter, and Regulations 883/2004 and 987/2009).
The scope for addressing Britain’s demands is limited because it will not be possible to alter these provisions and principles without Treaty amendment. Secondary legislation can be used to alter social security rights, which are not mandated by Treaty obligations, provided the alterations comply with the general principles of EU law.
That said, the elements of this British demand that focus on fraud and abuse of the system could easily be addressed through secondary legislation. Two recent CJEU judgments, Dano and Alimanovic, also indicate the Court’s willingness to tackle this angle.
The British demands pose considerable legal problems if they are to be accommodated, but legal structures exist which can provide the necessary legal protection if political agreement can be obtained. It would assist if the concessions can be framed in general terms so as to apply them to all Member States.