OK, I might be jumping the gun – there may yet be a Deal between Britain and the EU – but as a result of this discussion with Catherine De Vries, it’s important to grasp the nettle – what terminology do we use for what comes in Brexit after 1st January in the absence of a UK-EU Deal?
No Deal Brexit
This is already talked about as if it is both obvious, and permanent, but in reality it is nothing of the sort. It essentially only means that the UK ends its Brexit Transition Period on 31 December 2020, and after that day there is no further Treaty between the UK and the EU. No Deal Brexit hence means the period during which there is an absence of a trade Deal between the UK and the EU.
Short No Deal Brexit vs. Long No Deal Brexit
In the absence of a deal from 1st January, how long does this state of affairs last? It can be anything from a matter of a few days or weeks (Short No Deal Brexit) to something stretching to some months or into the years (Long No Deal Brexit). Short No Deal Brexit could occur if, for example, time ran out to ratify a Deal by the end of December, but both sides acknowledged this was just a short interruption. Long No Deal Brexit would occur if the breakdown was more permanent – both sides chose to retrench in the case of a negotiation failure (the UK has stated it will not negotiate further in 2021 already – whether it sticks to that or not is of course anyone’s guess…)
Respectful No Deal vs. Acrimonious No Deal
This is a counterpart to Short vs. Long – for it is determined by the terms on which negotiations broke down. Was it that just a little extra was required to get it over the line, and that was missing? Or do negotiations end in anger and acrimony? The EU side has stayed rather calm throughout the past few months, but there are some on the UK side who see it very differently. And if things become bitter and acrimonious, it leads to the question of whether the people involved must change in order to bring new life and a new dynamic into the process to find a Deal. A Respectful No Deal is therefore likely to lead to some reconciliation and rapprochement more quickly than and acrimonious fall out.
Stoic No Deal Brexit vs. Panicked No Deal Brexit
This one focuses on the practical consequences of No Deal Brexit – the impact of the imposition of tariffs, the headaches that causes at UK channel ports, and the chaos this causes to supply chains. We know that any disruption is going to be more marked on the UK side, but the absence of a Deal on fishing might lead to some interesting consequences in French or Spanish ports as well. The essential issue though, UK side, is how does the population react to a No Deal? Is it stoic resignation, accompanied by companies making the best of a complicated situation? Or is it anger and panic and runs on supermarkets and Kent being turned into queues of trucks waiting to get to Dover? The latter – a Panicked No Deal Brexit – would push both sides back to the negotiation table more quickly than a Stoic No Deal Brexit.
Brexit Side Deals
Until now both the UK and the EU have aimed for one overall, all-encompassing Deal. However if that cannot be concluded, and No Deal Brexit is either Long or Panicked or both, expect pressure to rise for deals on narrower aspects – customs, or agriculture, or customs procedures. Whether any of these would be achievable would be a function of some of the other factors outlined in previous paragraphs.
And what then…?
Were there to then be a Deal after a period of No Deal, that Deal would then itself have some name – either a typical EU moniker based on a city name (the Treaty of London or the Treaty of Brussels or something), or some other name – the UK-EU Trade and Investment Treaty (UKEUTIT) for example. The EU in particular has never shown much willingness to go for this route, but if things get nasty in 2021 they might have no choice.
So there you are. Are you ready for a Long, Acrimonious, Stoic No Deal? Or are you banking on a Short, Respectful one in the absence of Brexit Side Deals?