Legal experts, including one who advised the Treasury, agree Theresa May will leave the UK open to legal action in The Hague if she pulls out of the European Economic Area (EEA) without formally telling its other members 12 months in advance, to avoid disrupting their trade.
The notice is demanded by an international agreement, but ministers do not intend to follow the process because, insiders believe, they want to avoid a Commons vote on staying in the EEA – and, therefore, the single market – that they might lose.
As well as the a court battle, experts warn the stigma from breaking the agreement could also make it harder for Britain to secure the trade deals it desperately needs to secure the economy after Brexit.
Pro-EU MPs hope the legal opinion will help persuade the Commons to force and win the vote on staying in the EEA planned for the autumn.
The Government has insisted EEA membership will end automatically with EU withdrawal but former Treasury legal adviser Charles Marquand, said: “A failure by the UK to give notice of its intention to leave would, I think, be a breach of the EEA Agreement, which is an international treaty.”
The barrister said it was difficult to predict how another EEA states might seek to take action, if it believed its single market rights had been removed wrongly. But he added: “I believe there is a potential for international proceedings. One possibility is the Permanent Court of Arbitration in The Hague.”
Heinrich Nemeczek, from the Law Faculty at the University of Basel, said: “This question would certainly have to be decided by a court, or other institution.
“It would, in principle, be possible that the question on the UK’s EEA membership can be brought to the International Court of Justice, or the Permanent Court of Arbitration, as the EEA Agreement is an international agreement.”
Mr Nemeczek stressed the ability to bring a case did not mean he believed it would succeed in proving Britain was in breach of Article 127 of the EEA Agreement.
Stephen Kinnock is among a group of Labour and rebel Tory MPs trying to secure retained membership of the EEA for several years at least, to avert the threat of severe economic damage when Brexit is completed in 2019. The Labour MP said the threat of a tribunal action “strengthens the case” for MPs to defeat the Prime Minister on the controversy.
A backbench amendment is likely to be tabled to the flagship European Union (Withdrawal) Bill – or “Repeal Bill” – which reaches the Commons floor on 7 September.
“This has to be taken into account,” said Mr Kinnock. “We must avoid any difficulty with an international tribunal, perhaps even the International Court of Justice. MPs have to examine their consciences and what’s in the national interest. Part of that must be what’s best for the UK’s international standing as a country that wants to stand tall in the world, that recognises its international obligations.”
And Sir Vince Cable, the Liberal Democrat leader, said: “Yet again the Government’s shambolic approach to Brexit puts the UK in legal uncertainty. If these legal experts are correct, there must be a vote in Parliament to settle the matter. And I would gladly work with MPs from any party to ensure that Britain maintains our membership of the EEA in order to protect jobs, trade and the economy.”
Mr Marquand acted as the barrister for Single Market Justice (SMJ), a group trying to force the Government to require the explicit consent of MPs before it leaves the EEA. In February, the High Court rejected its case, but only because the Government had not yet decided which legal route it would take to leave the EEA – leaving the door open to future appeals.
Now ministers have set out that route, as part of the EU Withdrawal Bill, stating: “The UK is a member of the EEA by virtue of its membership of the EU. Therefore on exit day the UK ceases to participate in the EEA Agreement.”
It means that, unless the bill is amended, the Government will have parliamentary consent to automatically leaving the EEA – with the risk of breaching the treaty and a tribunal challenge. But only a small number of rebel Tories could be sufficient to defeat the Government in any Commons vote, given the Prime Minister’s precarious working majority of just 12.
Adrian Yalland, one of SMJ’s founders, said: “If Parliament wants a meaningful say over the single market, it must amend the bill so that EU membership is decoupled from EEA membership.”
But a spokeswoman for the Department for Exiting the European Union said: "We have been clear that we will no longer be a member of the EEA after we leave the EU. The UK is party to the EEA agreement only in its capacity as an EU member state. Once the UK leaves the EU, the EEA agreement will automatically cease to apply to the UK."
The EEA, created in 1994, consists of Norway, Iceland and Liechtenstein, together with the 28 – soon to be 27 – EU members, with all accepting free movement of citizens.
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