Brexit Bulletin July 27, 2016

The following is a roundup of recent developments concerning Brexit negotiations and the United Kingdom’s withdrawal from the European Union.

Political

• Prime Minister Theresa May’s newly formed cabinet includes a Brexit department headed by David Davis, a prominent Brexiter who will serve as Secretary of State for Exiting the European Union.
• Labour Party leadership will be decided in September in a contest between current leader Jeremy Corbyn and challenger Owen Smith. Smith has called for a second referendum allowing voters to approve a UK-EU Brexit deal.
• On the international stage, May met with German Chancellor Angela Merkel, French President Franҫois Hollande, and EU Council President Donald Tusk. May said that the U.K. seeks a “sensible” and “orderly” exit, and that the U.K. will decline its rotating turn as president of the EU Council previously scheduled for 2017. Hollande said the U.K. should begin exit negotiations “the sooner, the better” for the respective economies.
• A special session of the British-Irish Council was convened to discuss implications of the Brexit vote and the participation of the devolved administrations of Scotland, Northern Ireland and Wales in Brexit negotiations. Read the Council’s communiqué here.

Immigration

• The European Union is reportedly considering giving the U.K. a seven-year exemption from free-migration rules while allowing continued access to the single market, according to an article in the Observer citing unnamed senior U.K. officials.
• The new Home Secretary Amber Rudd, who supported the Remain campaign, has said she will seek to reduce migration to “sustainable levels.” Among other policies, Rudd will decide whether to adopt a points-based immigration system for EU nationals seeking to work in the U.K., a system the U.K. currently uses for non-EU nationals.

Legal

• A trial concerning the Brexit vote will be heard in October. The legal challenges, brought by several law firms on behalf of British citizens, claim that the referendum was merely advisory and that exit procedures cannot be triggered without Parliamentary assent. The government asserts that the prime minister has authority under executive powers to begin exit procedures. Article 50 of the Treaty of Lisbon, which controls EU withdrawal procedures, states that a member state “may decide to withdraw from the Union in accordance with its own constitutional requirements.”
• May has stated that she will not trigger exit procedures before the end of the year. Under Article 50, a member country triggers withdrawal procedures by notifying the EU of its intent to withdraw.

Things to Know

• A survey by the Institute of Directors after the Brexit vote found that almost a quarter of firms surveyed said they planned to freeze recruitment of new staff, one third would continue hiring, and 5 percent would make cuts.
• Weak economic data has led economist Martin Weale, a member of the Bank of England’s monetary policy committee, to change his mind and favor an immediate stimulus and possible interest rate cut, according to Financial Times.
• Last season, England’s Premier League registered 432 European players, of whom only 23 would have qualified for work permits if free movement were removed, according to a BBC study.

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