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Leaving the EU implies automatic exclusion from the EEA?

by Luis de Sousa Tue Nov 29th, 2016 at 07:35:18 PM EST

This question is slowly percolating through the wall of noise  around the UK's exit from the EU. More attentive folks are wondering if to leave the European Economic Area (EEA) a formal notification is required. I.e., if beyond triggering Article 50 of the Lisbon Treaty, in order to fully exit its social and economics commitments the UK needs to trigger Article 127 of the EEA Agreement.

This question is highly relevant for a simple reason: membership of the EEA was not voted in referendum, therefore the UK institutions - Government, Parliament and House of Lords - are not morally obliged to any particular course of action in this regard. If leaving the EU does not automatically exclude the UK from the EEA, it will then remain a full member of the so called "Common Market" with all the rights and obligations it entails.

Frontpaged - Frank Schnittger

The EEA Agreement was the final step before the creation of the EU, providing both for an ante-chamber for members to be and a socio-economic relationship framework for neighbouring countries. It was signed in 1992 individually by each of the fifteen members of the then European Community (EC) plus three members of the European Free Trade Association (EFTA). It was this agreement that enshrined the legal basis for what is often referred as "The Four Freedoms": the free movement of Goods, People, Capital and Services.

The EEA Agreement was clearly designed exclusively for EC and EFTA members, as can be read already in the opening statement:

DESIROUS of contributing to the strengthening of the cooperation between the members of the European Parliament and of the Parliaments of the EFTA States, as well as between the social partners in the European Community and in the EFTA States;

Part VII of the Agreement lays out the institutional structure governing the EEA. Article 90 establishes clearly whom takes part:

Article 90

  1. The EEA Council shall consist of the members of the Council of the European Communities and members of the EC Commission, and of one member of the Government of each of the EFTA States. [...]

  2. Decisions by the EEA Council shall be taken by agreement between the Community, on the one hand, and the EFTA States, on the other.

This means that upon leaving the EU, the UK will lose its representation in the EEA Council, but it is far from implying a complete exit from the EEA. In effect, nowhere in this part of the Agreement is stated that membership of the EC or the EFTA are a precondition for participation in the EEA.

In Part IX are established a series of provisions to the functioning of the EEA; within, Article 126 opens with:

Article 126

1. (19) The Agreement shall apply to the territories to which the Treaty establishing the European Economic Community (20) is applied and under the conditions laid down in that Treaty (21), and to the territories of Iceland (22), the Principality of Liechtenstein and the Kingdom of Norway (23).

At this point things become somewhat murkier. This paragraph clearly states to which territories the Agreement applies, but does it mean that it does not apply elsewhere? This is perhaps the key to the wider question.

It is also worthy to read closely the conditions for an exit from the EEA. This is the soon to be famous Article 127:

Article 127

Each Contracting Party may withdraw from this Agreement provided it gives at least twelve months' notice in writing to the other Contracting Parties.

Immediately after the notification of the intended withdrawal, the other Contracting Parties shall convene a diplomatic conference in order to envisage the necessary modifications to bring to the Agreement.

Pretty bare, but enough to establish an interesting exit strategy for the UK government. If indeed it comes to be established that leaving the EU does not imply automatic exclusion from the EEA, the UK government may opt to trigger Article 50 and calmly focus on disentangle itself from the EU exclusively at the political and budgetary levels. Later on, if it so wishes, the UK government may deliver notice to an exit from the EEA within an extended time frame, say five or six years. During that period it can take its time drafting a new socio-economic relationship with the EU, a UK-EU Free Trade Agreement.

At this moment I am inclined to think that triggering Article 50 of the Lisbon treaty does not automatically imply an exit from the EEA. But I am far from knowing the EU legislation and treaties in full.

What are you thoughts? Would you know other provisions in EU treaties that could clarify this matter? Please leave your comments below.

This is a cross-post from AtTheEdgeOfTime

Leaving the EU implies automatic exclusion from the EEA?
. Yes 50%
. No 50%
. Brexit means Brexit 0%
. Stop moaning ang get on with it! 0%

Votes: 4
Results | Other Polls
While triggering Article 127 of the EEA may be formally required if the EU or a named member state wishes to leave, it appears to me that the UK is only a member by virtue of its EU membership. Why else would the Treaty so explicitly name the member states and territories which are party to the Treaty? And if the UK wishes to discontinue participation in one of the Four Freedoms, why would it wish to remain a member in any case?

Treaties don't generally explicitly name all the states and territories to which they don't apply, so the absence of a specific statement that the Treaty doesn't apply to every other state or territories doesn't imply that it does, or can.

Of course there is no reason why EEA members couldn't voluntarily continue to consider the UK a member post Brexit, but the Treaty certainly doesn't require that they must. Given the EU has consistently insisted that the Four Freedoms are indivisible, it is very unclear why they would wish to do so.

So in summary, it appears you are grasping at a straw no one has shown any interest in pursuing!

Index of Frank's Diaries

by Frank Schnittger (mail Frankschnittger at hot male dotty communists) on Tue Nov 29th, 2016 at 09:32:23 PM EST
The UK is not member of the EEA solely because of its EU membership. The UK is an individual signatory to the Agreement.

In your last paragraph you appear to imply that the other members of the Agreement can expel the UK from the EEA. No such provision exists in the Agreement. There is however a procedure to temporarily suspend a member (Article 102) in case it fails to implement the required legislation. As long as the UK complies with its obligations it can not be suspended this way. I expect the ultimate decision on EEA membership to come up to the European Court.

I follow the British media at some distance, but close enough to understand that membership of the EEA remains an hot topic. The Government itself has vented the desire for a "transition period" during which it would remain in the EEA.


by Luis de Sousa (luis[dot]de[dot]sousa[at]protonmail[dot]ch) on Wed Nov 30th, 2016 at 08:19:08 AM EST
[ Parent ]
All EU members have to separately and independently ratify any external Treaty or trade deal the EU agrees to, but that doesn't necessarily make them independent parties to that agreement. The UK isn't named as a member of the EEA even though it is a signatory of it, so you have to ask the question; in what capacity did the UK sign it - as a member of the EU, or as an independent member of the EEA in it's own right?  And if the latter, why isn't it explicitly named as a member?

Clearly the EEA agreement didn't envisage or provide for a situation where the UK might leave the EU, so we are on virgin territory here.  I don't see a problem if every member agrees to the UK remaining within the EEA, but if some want it in, and others don't, then the matter could end up being determined by the ECJ or whatever the relevant legal authority is.  But if the UK has no representation on the EEA Council, why would it want to remain in? It would have less say on matters effecting it than Liechtenstein.

Index of Frank's Diaries

by Frank Schnittger (mail Frankschnittger at hot male dotty communists) on Wed Nov 30th, 2016 at 06:13:22 PM EST
[ Parent ]
so you have to ask the question; in what capacity did the UK sign it - as a member of the EU, or as an independent member of the EEA in it's own right?

Yes, this another way of synthesising the issue. The UK is directly identified as a "Contracting Party" in the Agreement, independent of the EC (this is different from a ratification). My impression is therefore that indeed it is an independent member of EEA. But I agree this is likely to end up with the ECJ.


by Luis de Sousa (luis[dot]de[dot]sousa[at]protonmail[dot]ch) on Wed Nov 30th, 2016 at 08:08:29 PM EST
[ Parent ]
Isn't the crucial part here if this is a treaty between the EEC/EC/EU as such and the EFTA states or between the states in the EEC/EC/EU and the EFTA states?

Since the composition of the EEC/EC/EU has changed since, the new member states relation shows if being a EEC/EC/EU member automatically gives EEA memberships.

AGREEMENT ON THE - EEAagreement.pdf

Article 128
Any  European  State  becoming  a  member  of  the  Community  shall,  and  the  Swiss  Confederation  or  any  European  State becoming a member of EFTA may, apply to become a party to this Agreement.  It shall address its application to the EEA Council.

So it isn't automatic, but it is mandatory. The EEA Council could in theory deny membership to new EU members, showing that it is not a package deal even though they go hand in hand.

I think that is a strong argument that the EEC/EC/EU states are members in EEA as such, just as the EFTA states. So it coud be argued that leaving the EU isn't the same as leaving the EEA.

As to why the UK government would want it, I think there are two different answers:

  1. It gives a halfway house from where they can conduct further negotiations on their own timetable. A major problem with leaving is the timetable and lack of clear relations to the rest of the world upon leaving.
  2. The UK government's position on not wanting free movement but wanting access for finance can not be squared, so in the end they might go for something else. For example the EEA.
by fjallstrom on Wed Nov 30th, 2016 at 11:49:27 AM EST
As if on cue to support my argument about Britain being unable to square the circle.

UK unlikely to stay in single market, Tory document suggests | Politics | The Guardian

Britain is unlikely to be able to remain a member of the single market, according to a document photographed in the hands of a senior Conservative official on Downing Street.

A handwritten note, carried by an aide to the Tory vice-chair Mark Field after a meeting at the Department for Exiting the European Union, could be seen to say: "What's the model? Have cake and eat it."

The article is not arguing that the UK government will want to stay in the EEA though.

UK unlikely to stay in single market, Tory document suggests | Politics | The Guardian

The document appears to reflect a discussion about the prospect of a trade deal like that of Norway, which is a member of the European Economic Area.

"Why no Norway - two elements - no ECJ intervention. Unlikely to do internal market."

That appears to refer to the drawbacks of taking on the Norwegian model, which has the country outside the EU and its customs union, but inside the single market.

The reason Brexit supporters do not want to follow that idea is the requirement that Norway accepts free movement of people and is under the jurisdiction of the European court.  

by fjallstrom on Wed Nov 30th, 2016 at 01:38:12 PM EST
have cake and eat it is exactly what they won't get. It will be a hrd brexit and it's cold out there

keep to the Fen Causeway
by Helen (lareinagal at yahoo dot co dot uk) on Wed Nov 30th, 2016 at 07:38:23 PM EST
[ Parent ]
Since all the Brexit luminaries (Johnson, Fox, Gove, etc) promised an exit from the single market (i.e. the EEA) I agree it is not likely for the UK to remain a member of the EEA in the long run. However, technically the referendum did not question this membership, therefore it provides an important margin of manoeuvre to the government.

by Luis de Sousa (luis[dot]de[dot]sousa[at]protonmail[dot]ch) on Wed Nov 30th, 2016 at 08:18:02 PM EST
[ Parent ]

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