Despite Theresa May’s best efforts, there has been a running commentary on Brexit over the last month – but it has perhaps created more smoke than light. Here’s my summary of what we do know about how 2017 may pan out.
Negotiations will start in March 2017
Article 50 (formal notification to leave, start of negotiations) will be triggered at the end of March (Parliament has now affirmed that). Government will publish some details of its approach to the exit negotiations in advance (David Davis indicated today that this may be a quite detailed plan but government may well publish a reasonably anodyne paper to keep its negotiating powder dry ). An Act of Parliament may need to be rushed though in February - if the Supreme Court rules in January that an Act of Parliament is required to trigger article 50. The ‘article 50 moment’ may trigger increased business interest but in practice it will not provide much more certainty to plan around…
Not much will happen until October 2017
We have a series of elections in Europe in 2017: Netherlands (March), France (May), Germany (September/October); and a possibility of an early election in Italy. These could change the political landscape of Europe – with a rise in nationalist, anti-Europe support in France and Netherlands. Brexit negotiations are unlikely to make much headway until the results of these elections are known.
Negotiations should be complete by March 2019
The end of the 2-year period. They could be extended. Equally, the EU’s chief negotiator (Michel Barnier) has suggested that in order to complete all EU ratifications in time for March 2019, the actual negotiations will need to be complete 6 months earlier.So we may see most negotiations taking place in a 12-month period: October 2017 to October 2018. Businesses will have little to plan around before then – other than uncertainty.
Some businesses will not be prepared to wait
Scenario planning in Financial Services may start to give way to some decisions and execution of re-domicile plans from spring 2017. This could make psychological factors more important than the legal process: a few business decisions may start to trigger movement by others.
The one thing we can predict for next year is that there will be further political and economic uncertainty.
Britain will not have a Brexit plan until February at the earliest but should be able to negotiate its departure from the EU and a new trade deal within 18 months of triggering article 50, David Davis has said.