On 8 December, EU and UK negotiators signed a report presenting the progress made in Stage One of the Brexit negotiations. The document, while marking a necessary step in the direction of a final deal, falls short of a breakthrough on key issues.
The EU and the UK declared “sufficient progress” in the negotiations, allowing them to start talks on a future comprehensive relationship. Specifically, they agreed on the methodology of calculating the “divorce bill,” the amount the UK owes the bloc to meet various obligations undertaken as a member, and agreed that the British would pay and use funds under the 2014-2020 Multiannual Financial Framework without any change resulting from Brexit. The UK also agreed that after Brexit it would guarantee rights accrued to current EU migrants living in the UK, including respecting EU Court of Justice jurisdiction in interpreting EU law for eight years after the set exit date. The UK government also will ensure harmonisation of law on the entire island of Ireland and the preservation of Northern Ireland’s integral position within the United Kingdom.
The agreement is not legally binding. It also states that “nothing is agreed until everything is agreed,” therefore its content ultimately depends on the successful conclusion and ratification of an exit treaty. In addition, the final settlement of many controversial issues was postponed into the Stage Two talks, such as the exact sums in the “divorce bill” and technicalities of the future border regime on Ireland. The document also contains several visible contradictions in terms. For example, a literal reading of the UK’s commitment to harmonised law between Northern Ireland and the Irish Republic (i.e., the EU) while keeping Northern Ireland fully integrated with Britain (i.e., the mainland UK) would render a real British exit from the EU impossible.
The EU achieved all its basic Stage One goals. It obtained from the UK recognition of its financial obligations in the period following its departure from the bloc, as well as consent to protect EU citizens’ rights under Union law and institutions for eight years. Moreover, the UK accepted the harmonisation of law on Ireland after Brexit, and co-financing of EU programmes in Northern Ireland (e.g., the “PEACE” programme). For the UK, the key success is the breaking of the deadlock in negotiations with the opening of talks on the future relationship. By postponing the decision on the freedom of movement of people between the EU and UK, and establishing a separate negotiation path that ties further talks on Northern Ireland with those on transit between the Republic of Ireland and EU-26 through Britain, also constitute a tactical success for the UK.
EU and UK negotiators presented the agreement as a good compromise. Guy Verhofstadt, as the European Parliament representative to the talks (the chamber can veto the final agreement), backed the “sufficient progress” assessment but made further demands for the upcoming talks. The reactions of British political parties are much more complex. The Conservatives, Labour, Liberal Democrats, and Democratic Unionists (DUP), declared conditional support. Nevertheless, Eurosceptics, both in those parties and outside them, were highly critical of the agreement. Theresa May’s government maintains its mandate to continue the negotiations but remains exposed to the risk of a Tory leadership challenge and the reshuffle that would ensue.
The agreement means that at the European Council summit of 14–15 December, it could open Stage Two talks. The key political, conceptual, and technical challenges are to agree by September 2018 a future model of cooperation that is satisfactory for both the EU and the UK. British Eurosceptics challenge May’s concessions as undermining Brexit’s basic purpose to remove the country from the EU. The final treaty will be difficult to ratify in the UK without a favourable trade deal. The fragility of the political balance in the negotiations was demonstrated in early December by an Irish threat to block the talks absent a UK guarantee of the status quo on the island of Ireland, and DUP’s subsequent announcement of withdrawal of support for May due to concerns about a possible separation of Northern Ireland from mainland UK.