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BREXIT: What yesterday’s Votes Meant

The UK prime minister took Brexit plan B amendment to the parliament yesterday after losing votes on the initial plan A. This amendment was accompanied by other MPs’ suggested amendments, which were all voted on by the parliament MPs.

UK’s Expectations

Theresa May won her amendment yesterday meaning that she is offered another chance of ‘better’ negotiations with Brussels. From an alternative side, MPs’ amendments that would have given the parliament the power to extend Article 50 (delay Brexit) if a no-deal nears were voted down.

During the coming days up until February 14th, the UK’s PM is expected to seek a “significant and legally binding change” on the Irish backstop that would prevent the UK from being indefinitely tied to EU rules.

European Union Stance

The other negotiating side of Brexit which is the European Union (EU) have been unequivocally clear that there wouldn’t be any further renegotiations to the backstop – Donald Tusk, the EU council president wasn’t shy to immediately reiterate this in a tweet after yesterday votes. The deputy chief EU Brexit negotiator, Sabine Weyland literally was absolute with her “we are not going to reopen the agreement”.


Way Forward or Not?

The expected next step is for the UK parliament to vote on February 14 on May’s newly amended deal. If the PM fails to get the expected amendment on the withdrawal agreement (WA), the reopening of possible amendments that would change the dynamics of Brexit is highly likely – such amendments would most likely include Brexit delay (Article 50 extensions) or softer WA (possibly that of Norway’s) and also a possible consideration of a second referendum. Amongst these options, given the united front of the EU, the second referendum looks like European bloc’s most viable.


“Malthouse Compromise”

The Malthouse compromise (culled after Kit Malthouse, the Brexiteer minister of state for housing who helped shaped the proposal) is starting to gain traction within the UK government. This proposal contains two parts:

Part 1

If May fails to come back from Brussels with a palatable deal the UK will maintain its offer on the rights of EU citizens with the extension of the transitional arrangement where the UK remains within the customs union and single market for an extra year from December 2020 to December 2021. This extensions give the negotiating parties ample time to negotiate their trading relationships, organize and implement necessary infrastructure to help enhance frictionless trading between parties. If this plan is voted for, by default it takes ‘no deal’ off the horizon whilst providing required time to well plan for future trade relationship thus most likely providing effective bolster to economic activities.

Part 2

If a no deal is imminent following May’s failure to get improved dealings with Brussels then this part 2 would be activated. This part would entail the UK requesting for a transitional period extended again to 2021 – this removes the possibility of a hard Brexit if EU agrees. The UK in return would continue financing the EU budget by paying an estimated £10 billion annually with the rights of EU’s citizens guaranteed – this provides ample time to well-prepare for a WTO trade relationship (in the case of a no deal) or an entire new trade deal.

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