Brexit: The divorce deal that was

Theresa May’s Brexit deal is as good as dead after British MPs voted against it yesterday, in what was billed as a historic day for the UK.

Delaying the vote by a month after May realised she had no support for the deal, did little to convince MPs that agreement was satisfactory.

The British Prime Minister failed to convince many within her own Conservative Party to back the agreement that laid out the terms of the divorce from the EU.

Rejection of the deal does not stop the UK from exiting the EU at 11pm (UK time) on 29 March, 2019.

The day and time of exit are sanctioned by law and MPs will have to pass amendments to postpone it. It remains unclear whether this will happen but the EU has signalled that it is willing to accept extending the Brexit deadline.

The European Court of Justice has also ruled that Britain can unilaterally stop Brexit at any stage before it formally exits without the need to consult or gain approval from the other 27 EU member states.

Unless an alternative is found, the decision taken yesterday by MPs means that Britain will exit the EU with no deal to smooth the transition while both sides discuss a future relationship.

May’s deal ensured that no major changes would occur to the relationship between the UK and the EU between March 2019 and December 2020. This would have given people, businesses and the economy enough time to adjust while both sides discuss and agree on future relations.

The deal also laid down that the UK will have to pay £39 billion to break the partnership with the EU, which mostly reflects the commitments undertaken by Britain.

The agreement also defined what will happen to UK citizens living elsewhere in the EU, and equally, what will happen to EU citizens living in the UK.

But crucially, the deal also made provisions to avoid the return of a physical border between Northern Ireland and the Republic of Ireland. This included a backstop solution that would keep Northern Ireland in a customs union with the EU to avoid a hard border, while the rest of the UK would opt out, in the absence of an agreement being reached on the future relationship.

It was this backstop solution that caused problems. It was rejected outright by May’s junior coalition partner, the Northern Irish Democratic Unionist Party, who feared the backstop would hive off Northern Ireland from the rest of the UK. It was objected to by many Conservative MPs as well, describing it as a threat to British sovereignty.

The vote against May’s deal leaves Britain in an uncertain situation.

Leaving without a deal will mean that on 30 March, the UK will automatically be considered by the EU as a third country. The divorce will be abrupt and EU laws will immediately stop applying to the UK.

Customs checks and trade tariffs will be introduced and other disruptions are possible. The UK government has recently started preparing for such an eventuality.

Trade relations will be governed by World Trade Organisation rules until a new future relationship is agreed.

While some Brexiteers would be fine with this, the sudden rupture could create uncertainty. It will also mean that a hard border would have to be erected between Northern Ireland and Ireland. How this will happen soon is unclear.

What happens depends on May’s next steps but it is clear that time is running out as Britain looks set to crash out of the EU at the end of March.

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