May Secures Last Minute Concessions, Juncker Says No 3rd Chances, Pound Rallies

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Theresa May says the EU made legally-binding assurances that the UK will not be permanently trapped in a customs union.

May-Juncker Announcement

The Wall Street Journal reports Theresa May Secures Last-Minute Concessions from the EU on a Brexit Deal.

“Today, we have secured legal changes,” Mrs. May said. “Now is the time to come together to back this improved Brexit deal and deliver on the instruction of the British people.”

Despite the changes, Mrs. May faces an uphill challenge to get British lawmakers to back the deal in Tuesday’s vote. The prime minister is banking on key lawmakers endorsing her revised deal and bringing others on-side with them.

Still financial markets interpreted the agreement as evidence that a Brexit deal was increasingly likely to be signed off, avoiding a chaotic split between the U.K. and the EU. From the time news broke that Mrs. May would fly to France for last-ditch talks, the pound began strengthening on hopes a deal would ensue. It ended up more than 2% against the dollar with one pound buying $1.325 late Monday.

The EU offered a new legal instrument that would allow the U.K. to seek independent arbitration if it believed the EU was not negotiating a new trade agreement in good faith. If the U.K. claim were upheld and the EU continued to drag its feet, the U.K. could be freed from the customs arrangement. The EU also offered a legally binding pledge to work quickly on a future trade agreement to ensure that the backstop is temporary.

The two sides also agreed that the U.K. would set out its own interpretation of the deal, which would state that the U.K. believes it has the option to bring the customs union arrangement to an end.

Legally Bending Enough?

Is that enough to satisfy those in doubt? I don't know. The hard core Brexiters may not come on board.

If DUP and some in the Labour party hop on board, perhaps it's enough in a third vote in a third vote if not a second.

No Third Chance

The Guardin reports Jean-Claude Juncker says There will be no third chance to pass Brexit deal.

Senior Labour figures said nothing of substance had changed. The shadow Brexit secretary, Keir Starmer, attacked the deal in the Commons on Monday and the Labour leader, Jeremy Corbyn, indicated the party would not back it there on Tuesday. Many commentators noted that the key to its success would be whether or not the changes would lead the attorney general to change his legal advice that the backstop could leave the UK trapped indefinitely in the backstop.

Juncker warned there would be no further chance to pass a withdrawal deal. He said: “In politics, sometimes you get a second chance ... There will be no third chance.” And he added a warning that “it is this deal or Brexit might not happen at all”. Moreover, he said, the UK would be legally obliged to hold European Parliament elections in May, should Brexit not be sorted by then.

The hard Brexit-supporting factions within Parliament appeared split on whether or not the new deal could satisfy them. The DUP said it would reserve judgment. Some figures in the Tory backbench ERG dismissed it as “gloss”, while others were more willing to consider it. They may be key to passing or rejecting the – as well as to May’s political career.

No third chance is not precisely accurate.

It may take a couple of votes to get the revised deal over the finish line. It does has to happen before March 29.

More likely, Juncker means this is the EU's final offer. But they said that many times and here they are offering a concession.

Meaningful Concession?

Is the concession meaningful?

Geoffrey Cox, the attorney general, will give legal advice and publish an update on Tuesday morning.

His opinion carries weight, but it does not make him right. Only a court of law or arbitration process can determine that.

One key fact is that it will not be the European Court of Justice that decides.

However, regardless of who decide, the EU is likely to demand something, perhaps many things. Fishing rights come to mind immediately.

It's a better deal than before, but is it good enough? We soon find out.

Mike "Mish" Shedlock

Comments (10)
No. 1-7
Christian dk
Christian dk

NO to a last minute paint job.... What a lot of crap....2 years of pretending to negotiate, and then have a new deal made up the very last night before the vote. This is exactly what caused the brexit in the first place.... If you treat people like ...idiots....they will behave like...Idiots....

kentwillumsen
kentwillumsen

The backstop is not the only issue. The whole WA is terrible. Hopefully it is voted down today.

Tengen
Tengen

Pound rallies, Nikkei up nicely, FTSE up modestly... is there any news that isn't bullish these days? I should clarify I mean any news besides regular voters getting what they want, of course.

George_Phillies
George_Phillies

From the Guardian, it appears that the AG advice did not change much.

Yancey_Ward
Yancey_Ward

All of this is a charade of the highest order. May is doing her best to make it look like a real negotiation, but the details are a giveaway to the real goal. Today's vote was designed to fail so that they can also vote down the "No Deal Brexit" and then get the delay necessary to hold the 2nd referendum which will be three-way- "May Deal", "No Deal", and "Remain". With Brexit vote split, "Remain" will win with a plurality and will be declared the "winner vote".