Summing up what is up after Brexit
Yesterday, when the result was evident, we noted that the stock exchanges around the world had only one trend: marked drops, the same was true for exchange rates. The unexpected changes followed during the day, the losses narrowed, but, so pretend experts the worst is not yet over, because obviously the Brexit created a turmoil of what is still going to happen.
In this context, we found an interesting aspect in the Washington Post, entitled “The British are frantically Googling what the EU is, hours after voting to leave it”, concluding that the exit voters did not know what they were doing! Interestingly enough, these were the most asked Google questions after the results were made public: What does it mean to leave the EU? What is the EU? Which countries are in the EU? What will happen, now that we have left the EU? How many countries are in the EU? Now, my question is are these all ignorant, or were these misinformed or misled? Or inexperienced to vote on such a world separating cause? Of course, the last referendum lays back in 1975 and the generations going to the poll has been changing.
The analysis of the voting shows, that the participation rate of voters was 72.2 %, thereof 51.9 % or 17.4 million votes for Brexit and 48.1 % or 16.1 million against Brexit. In England 53.4 % or 15.2 million voters (of total 73 % of participation) opted for and 46.6 % or 13.3 million against Brexit. In Northern Ireland 44.2 % (of total 62.9 % participation) or 0.35 million voted for and 55.8 % or 0.44 million against Brexit. In Scotland 38.0 % (of 67.2 % participation) or one million voted for and 1.7 million or 62.0 % against Brexit. In Wales 52.5 % or 0.85 million (of 71.7 % participation) voted for and 0.77 million or 47.5 % against Brexit. These are the hard facts.
As we all know, this result led to the fact that Premier David Cameron announced that he will step down just as soon as his party has named his successor. The Prime Minister of Scotland has announced that another referendum is on the table to separate from the UK since the population is straight forward to remain in the EU.
In turn, the EU is pressuring the U.K. to deposit its will to exit the EU, upon the formalisation of separation it will take two years to formulate the divorce conditions.
As another consequence of Brexit EU Commissioner Lord Hill, responsible for Financial Stability, Financial Services and the Capital Markets Union, has informed European Commission President Juncker of his decision to resign from his post as European Commissioner effective July 15, 2016. President Juncker has informed Martin Schulz, President of the European Parliament, of Lord Hill’s resignation and of his intention to transfer the portfolio to Vice-President Dombrovskis in order to allow for the relevant parliamentary consultation to take place.
Credit rating agencies are already menacing that they will downgrade the quality of the UK. Chancellor Angela Merkel is pleading for calmness and a new EU policy to show to the people what benefits they get through the EU, also French President Hollande is opting for drastic changes within the EU. The two will meet together with Italian Prime Minister Renzi in Berlin early next week to discuss the new situation. Obviously also to keep the decisive position within the EU. The UK will be left out in these decision making processes (see agenda of EU) and Germany is losing a supporter of its policy. Newspapers are also reflecting if the EU Commission should be reformed itself by exchanging them with a younger generation in order to push through the necessary reforms.
Yes, it is true, we are witnessing a historic moment, and with the strange feeling that no one really knows the consequences of this Brexit, however it will influence businesses (trade barriers, standards, subsidies, etc.), the economies and politics worldwide, and whatever the outcome is.
The rules of the exit of the UK according to the EU Commission
The European Commission takes note of the outcome of the UK Referendum.
Now that the UK has voted to leave the European Union, what happens next?
The European Commission takes note of the outcome of the UK Referendum. Proceedings under Article 50 of the Treaty on European Union will have to be launched.
The terms of the UK Settlement agreed at the European Council of 18-19 February 2016 have ceased to exist.
During negotiations under Article 50, European Union Treaties and law continue to apply to the UK. If no agreement is reached within 2 years of the UK activating Article 50, the UK would leave the EU without any new agreement being in place.
What role will the Commission play in the Article 50 process?
The European Commission will play the role foreseen in the Treaty.
Following notification by the UK of its intention to leave, the European Council, meeting without the UK, would need to agree the guidelines for the negotiation by unanimity. The agreement would be negotiated following the rules on international agreements in Article 218(3) of the Treaty. This means that the Commission would submit recommendations to the Council, minus the UK, which would then adopt a decision authorising the opening of negotiations and nominating the Union negotiator or the head of the Union’s negotiating team.
The negotiated agreement would need to be adopted by a qualified majority of 72% of the remaining 27 Member States, representing 65 % of the population. The final agreement would also need to be approved by the European Parliament, voting by a simple majority.
What happens next?
The College of Commissioners will meet on June 27, 2016 to assess the situation and prepare the European Council of 28-29 June.
The Commission stands ready to fulfil its role in the Article 50 negotiations.
Article 50 of the Treaty on European Union
1. Any Member State may decide to withdraw from the Union in accordance with its own constitutional requirements.
2. A Member State which decides to withdraw shall notify the European Council of its intention. In the light of the guidelines provided by the European Council, the Union shall negotiate and conclude an agreement with that State, setting out the arrangements for its withdrawal, taking account of the framework for its future relationship with the Union. That agreement shall be negotiated in accordance with Article 218(3) of the Treaty on the Functioning of the European Union. It shall be concluded on behalf of the Union by the Council, acting by a qualified majority, after obtaining the consent of the European Parliament.
3. The Treaties shall cease to apply to the State in question from the date of entry into force of the withdrawal agreement or, failing that, two years after the notification referred to in paragraph 2, unless the European Council, in agreement with the Member State concerned, unanimously decides to extend this period.
4. For the purposes of paragraphs 2 and 3, the member of the European Council or of the Council representing the withdrawing Member State shall not participate in the discussions of the European Council or Council or in decisions concerning it.
A qualified majority shall be defined in accordance with Article 238(3)(b) of the Treaty on the Functioning of the European Union.
5. If a State which has withdrawn from the Union asks to rejoin, its request shall be subject to the procedure referred to in Article 49.