04 January 2019

Brexit: to deal, or not to deal

Should the UK try to have a deal with the EU in place before its departure from it, an event currently scheduled for 29 March? Listening to the warnings of official experts, one would think that not to do so is courting major disaster. Official experts also warned that Brexit per se would be damaging to the UK economy, but so far those warnings seem to have been off the mark.

Whatever deal is struck, and whenever, one thing seems clear. Our politicians must be more than usually careful what they sign up to.

Any gaps or other uncertainties in the wording of an agreement are liable to cause problems down the line for the UK. The European Commission appears to have few scruples about exploiting such uncertainties, and interpreting legal wording 'creatively', if it thinks this would further EU interests. And it is probably not much good expecting support from the European Court of Justice in such a scenario; the Court's track record strongly suggests it will take the Commission's side.

The Commission's case against Ireland/Apple, which has generated a demand for an extra €13 billion of tax from Apple, provides a useful illustration of its approach to matters of law. The fact that there are few meaningful checks on the powers of the Commission means it is able to put its own interests above respect for legal principles such as legitimate expectations.

In the Apple case — currently going through the appeals process — the Commission is applying the law on state aid in a highly innovative way. If this is accepted by the courts, it will significantly change EU law but without the change having had prior approval from member states. Worse, the Commission is applying the change retrospectively, violating one of the key elements of the rule of law.

For details of the case, and its implications, see my article Legal opportunism and the collusion of powers.