Last reviewed 15 August 2019
The position of the EU remains that a no-deal scenario on the UK’s withdrawal from the EU is undesirable but is possible and their preparations are in place. In June the European Council reviewed the state of play of planning for a no-deal scenario, including the Commission’s fifth Brexit Preparedness Communication which takes stock of preparations and contingency measures taken by the EU and the other 27 Member States, the impact of the extension period and any remaining preparatory work that needs to be done. The Commission concludes that the measures taken remain fit for purpose and no new measures are planned before the withdrawal date but calls on Member States to make sure that all measures are in place. It stresses that contingency measures can only mitigate the most significant disruptions of a withdrawal without an agreement.
Since December 2017, the Commission has tabled 19 legislative proposals, the last of which, adopted on 9 July, concerns contingency measures on the implementation and financing of the 2019 EU Budget. These measures are designed to mitigate the impact of a no-deal scenario for funding in a wide range of areas such as research and agriculture. They will enable the EU to continue making payments to UK beneficiaries as long as the UK continues paying its contribution agreed in the EU Budget for 2019 and agrees to certain conditions.
The Commission has also adopted 63 non-legislative acts and published 100 preparedness notices. These have all been reviewed in the light of the extension of the Article 50 period to 31 October and found to need no amendment. They are a damage limitation exercise in areas that would be most seriously affected and are likely to cause the most problems for the EU. The measures aim to facilitate road haulage, rail and aviation continuity between the UK and the EU 27 and compensate fishermen for Brexit-related losses. They are mostly temporary, for 9-12 months, and then a future EU-UK relationship would provide long-term arrangements.
Preparations in the 27 other Member States
The Commission’s Communication gives details of the preparations in the 27 other EU Member States. It has held extensive technical discussions with the EU 27 both on general issues and on specific sectoral, legal and administrative issues and has found “a high degree of preparation by Member States for all scenarios”. However, the Communication points to areas where continued vigilance is required in the next months including citizens’ residence and social security entitlements, medicinal products, medical devices and chemical substances, customs, indirect taxation and border inspection posts, transport, fishing and financial services.
CBI says no one is ready for no deal
The Confederation of British Industry (CBI) published a report in July What Comes Next? The Business Analysis of No-deal Preparations on the no-deal preparations of the UK, the EU and business in 27 areas of the UK’s relationship with the EU that are the most important to business. It concluded that there are no areas of relevance to the economy that are well enough prepared for a no deal. It calls on the European Commission and Member States to match the UK’s mitigations in a range of areas from data to customs.
The EU for its part considers that it is well prepared. However, it believes that a no-deal Brexit would cause significant disruption for citizens and businesses and would have a serious negative impact which would be felt proportionally much more in the UK than in the rest of the EU.