Britain’s exit from the European Union has been pushed back once more after EU leaders decided that it was safer for everybody if the United Kingdom left with a deal rather than without one.
Brexit will now take place by 31 October—earlier if the United Kingdom agrees to the terms of the EU Withdrawal Agreement before then.
Prime Minister Theresa May had only wanted an extension until 30 June, but EU leaders felt that this was not an adequate timeframe to get Members of Parliament on board.
The delay is shorter than the year-long extension that Germany and Donald Tusk, president of the European Council, the EU institution made up of EU leaders that decides EU policy, had wanted, after France’s President Emmanuel Macron dug in his heels over awarding May yet more time (to possibly achieve little).
In what was apparently a fractious meeting in Brussels to extend Article 50 (the legal mechanism that triggered the two-year Brexit countdown), the European Council made it clear that “such an extension should last only as long as necessary and, in any event, no longer than 31 October.”
The leaders of the other 27 EU member states also stressed that the United Kingdom will have to hold European Parliament elections if it is still a member of the European Union between 23 and 26 May 2019—a scenario that MPs from both major parties had wanted to avoid.
If the United Kingdom fails to hold the elections, it will leave the European Union on 1 June 2019.
The European Council also reiterated that the EU Withdrawal Agreement was not up for further negotiation, and the extension cannot be used to start negotiations on the future relationship between the European Union and United Kingdom.
They said, however, “if the position of the United Kingdom were to evolve, the European Council is prepared to reconsider the Political Declaration on the future relationship,” which would pave the way for the country to be more aligned to the European Union than the current deal sets out, such as a customs union or Norway-style relationship.
And to ensure that Britain does not become an even more awkward customer while trying to cut its membership, the European Council has said the United Kingdom “shall refrain from any measure which could jeopardise the attainment of the European Union’s objectives, in particular when participating in the decision-making processes of the Union.”
The European Council will review progress at its meeting in June 2019.
The time extension does not guarantee that the United Kingdom will sign up to the Withdrawal Agreement. All of the options that have previously been outlined—leave with no deal, hold a second referendum, call a general election, call for a vote of no confidence in May and her government, ask for another time extension, revoke Article 50, and attempt a renegotiation of the EU’s deal—are still very much on the table.
Business sentiment, however, is generally relieved that the country is not crashing out of the Single Market on 12 April without a deal (or a plan).
Business network the British Chambers of Commerce (BCC) said that “businesses will be relieved, but their frustration with this seemingly endless political process is palpable.”
Carolyn Fairbairn, director-general of the Confederation of British Industry (CBI), the country’s biggest corporate lobbying group, said in a statement: “This new extension means that an imminent economic crisis has been averted, but it needs to mark a fresh start. More of the same will just mean more chaos this autumn. All political leaders must use the time well. Sincere cross-party collaboration must happen now to end this crisis.”
In a personal view, CBI President John Allan, chairman of supermarket chain Tesco and house builder Barrett, said that a second referendum should be called “if the politicians can’t get their act together.”