At their summit on 25 November, the leaders of the EU27 states approved the draft agreement providing for the U.K.’s withdrawal from the EU. The EU and U.K. also issued a joint statement outlining the framework for the post-Brexit EU/U.K. relationship.

These developments, although much-awaited, give little legal certainty in the short term.

Draft Withdrawal Agreement – Brief Summary

The draft agreement addresses a large number of Brexit issues in its 585 pages. If ratified, it will establish four key principles.

  • The “Divorce Bill”: The U.K. will be committed to make a €39 billion payment to the EU on exit. This is made up of the U.K.’s contribution to the EU’s annual budgets up to the end of the transition period, and the U.K.’s outstanding commitments and share of liabilities towards the EU.
  • Right to reside: The U.K. and EU will be committed to protecting the rights of EU citizens living in the U.K. and U.K. citizens living in the EU, to enable those citizens to continue working and studying where they presently live and to have their family members join them.
  • Irish border: Both parties will also be committed to avoiding a “hard” (manned) border between Northern Ireland, which is part of the U.K. and so will exit the EU, and the Republic of Ireland, which will remain an EU member state. An invisible (unmanned) border is an important principle of the Ireland/U.K. Good Friday peace agreement of 1998, which brought peace to the island of Ireland. The draft provides a “backstop” intended to ensure that, whatever the nature of the future relationship between the EU and U.K., this principle is respected, and the peace arrangements are not disrupted.
  • Transition period: Although the U.K. will leave the EU on 29 March 2019, there will be a transition period of 21 months until 31 December 2020. This is intended to allow time for the future EU/U.K. relationship to be agreed and for government and business to prepare for the new arrangements. During this period, which can be extended once (there is no cap on the duration of the extension), EU law will continue to apply in the U.K.

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