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Brexit—failure of the negotiations is a possibility

Apr 03, 2017

Brexit—failure of the negotiations is a possibility

The Brexit negotiations begin. What’s next:

29 April 2017, EU Special Summit in Rome
The leaders of the 27 EU member countries determine the negotiation goals.
These "Decision Makers" should define a LTN, the License to Negotiate which will contain a maximum goal and a minimum goal.
The maximum goal is easy, the minimum goal extremely difficult. If the minimum goal cannot be attained, the negotiations fail and the exit will be unregulated. Theresa May's statement, "Let's be clear, no deal is better than a bad deal", is hard to comprehend, because "no deal" means an unregulated exit and the UK would have no control over the processes that follow.
May 2017, the European Council gives chief negotiator Michel Barnier the mandate to negotiate.
Michel Barnier takes on the role of the "Commander", he has the overview over the entire period, he is the point where all information converges.
From our perspective, he should create two negotiation teams that negotiate independently from one another.

1.The "Brexit" team should advance the "divorce negotiation". These negotiations will be very confrontational because there are no common objectives for the time after. In addition, there are still high monetary demands that will have a strong impact on the course of the negotiations.

2. The team for the "trade deals" should negotiate on a possible collaboration for the time AFTER the Brexit. The style of these negotiations is cooperative because there could be a common future.

The UK has already asked that the two topics be combined. Under no circumstances should Barnier agree to such a combination.
Not only would a combined negotiation reduce leverage and increase time and effort, it would also mean an additional disadvantage: The negotiation team would have two different, contradictory objectives and two different strategies. It is practically impossible to implement such a negotiation structure.
October, 2018, Michel Barnier presents the negotiation result to the European Council
If the European Council approves the results, lawyers would have about 3 months to draw up the treaties.
Then the European Parliament and the European Council decide.
29 March 2019, Brexit, the membership of the UK in the European Union ends
The membership either ends in an orderly fashion with a treaty, or there will be an unregulated exit with no treaty.

Our Perspective:

  • The preparations for the Brexit negotiations are going very well: Ms. Merkel and Ms. May committed to fair and cooperative negotiations.
  • Michel Barnier is the optimal negotiation "Commander".
  • The President of the EU Council, Tusk, already prepares the public for a possible failure of the negotiations.

Negotiation tips:

  • The time-line until October, 2018, should be shortened, the results should be presented at the end of July, 2018.
  • This is the first exit negotiation. There is no master plan. This is why there will be many new challenges, and solutions will need time.
  • The negotiation teams should be kept as small as possible. It is better to have several small teams than large negotiation conferences.
  • Michel Barnier must not participate in the negotiations, lest he loses track of what is happening.
  • Both sides must accept a news embargo; the public will be informed quarterly on the state of the negotiations.