First, are the results really binding?
For the pro-“remain” side, this may be more wishful thinking than anything—given the scale of the “leave” victory—but, in theory at least, the referendum’s results are not binding. That’s because, in the U.K., it is Parliament that is sovereign. Referenda themselves are rare in the country—and Thursday’s was only the third in U.K. history.
Here’s more from the Financial Times earlier this month:
The relevant legislation did not provide for the referendum result to have any formal trigger effect. The referendum is advisory rather than mandatory. The 2011 referendum on electoral reform did have an obligation on the government to legislate in the event of a “yes” vote (the vote was “no” so this did not matter). But no such provision was included in the EU referendum legislation.
What happens next in the event of a vote to leave is therefore a matter of politics not law. It will come down to what is politically expedient and practicable. The UK government could seek to ignore such a vote; to explain it away and characterise it in terms that it has no credibility or binding effect (low turnout may be such an excuse). Or they could say it is now a matter for parliament, and then endeavour to win the parliamentary vote. Or ministers could try to re-negotiate another deal and put that to another referendum. There is, after all, a tradition of EU member states repeating referendums on EU-related matters until voters eventually vote the “right” way.
The Guardian has a similar explainer.
The official mechanism for the U.K. to leave the EU is the invocation of Article 50 of the Lisbon Treaty. Here’s what that says:
1. Any Member State may decide to withdraw from the Union in accordance with its own constitutional requirements.
2. A Member State which decides to withdraw shall notify the European Council of its intention. In the light of the guidelines provided by the European Council, the Union shall negotiate and conclude an agreement with that State, setting out the arrangements for its withdrawal, taking account of the framework for its future relationship with the Union. That agreement shall be negotiated in accordance with Article 218(3) of the Treaty on the Functioning of the European Union. It shall be concluded on behalf of the Union by the Council, acting by a qualified majority, after obtaining the consent of the European Parliament.
3. The Treaties shall cease to apply to the State in question from the date of entry into force of the withdrawal agreement or, failing that, two years after the notification referred to in paragraph 2, unless the European Council, in agreement with the Member State concerned, unanimously decides to extend this period.
4. For the purposes of paragraphs 2 and 3, the member of the European Council or of the Council representing the withdrawing Member State shall not participate in the discussions of the European Council or Council or in decisions concerning it.
A qualified majority shall be defined in accordance with Article 238(3)(b) of the Treaty on the Functioning of the European Union.
5. If a State which has withdrawn from the Union asks to rejoin, its request shall be subject to the procedure referred to in Article 49.
Article 50 has not yet been invoked, but it’s highly unlikely that, now that the referendum results have been announced, the will of the British public will be ignored just because the political establishment doesn’t like the outcome. The EU itself appears to be ready for the U.K. to leave. Here’s the joint EU statement:
We now expect the United Kingdom government to give effect to this decision of the British people as soon as possible, however painful that process may be. Any delay would unnecessarily prolong uncertainty. We have rules to deal with this in an orderly way. Article 50 of the Treaty on European Union sets out the procedure to be followed if a Member State decides to leave the European Union. We stand ready to launch negotiations swiftly with the United Kingdom regarding the terms and conditions of its withdrawal from the European Union.
How long will it take for the U.K. to actually leave?
No country has voted to leave the EU before, so there’s no precedent to judge by. But in theory, it’s supposed to take two years. In this time the U.K. will negotiate with the EU’s other 27 members on how to extricate itself from the bloc. The U.K. remains an EU member, with all the rights and privileges associated with that, until then. The two-year term is the period spelled out in an EU briefing paper on Article 50. Here’s what the paper says:
The right of a Member State to withdraw from the European Union was introduced for the first time with the Lisbon Treaty; the possibility of withdrawal was highly controversial before that. Article 50 TEU does not set down any substantive conditions for a Member State to be able to exercise its right to withdraw, rather it includes only procedural requirements. It provides for the negotiation of a withdrawal agreement between the EU and the withdrawing state, defining in particular the latter's future relationship with the Union. If no agreement is concluded within two years, that state's membership ends automatically, unless the European Council and the Member State concerned decide jointly to extend this period. The legal consequence of a withdrawal from the EU is the end of the application of the EU Treaties (and the Protocols thereto) in the state concerned from that point on. EU law ceases to apply in the withdrawing state, although any national acts adopted in implementation or transposition of EU law would remain valid until the national authorities decide to amend or repeal them. A withdrawal agreement would need to address the phasing-out of EU financial programmes and other EU norms. Experts agree that in order to replace EU law, specifically in any field of exclusive EU competence, the withdrawing state would need to enact substantial new legislation and that, in any case, complete isolation of the withdrawing state from the effects of the EU acquis would be impossible if there is to be a future relationship between former Member State and the EU. Furthermore, a withdrawal agreement could contain provisions on the transitional application of EU rules, in particular with regard to rights deriving from EU citizenship and to other rights deriving from EU law, which would otherwise extinguish with the withdrawal.
What happens to the U.K.?
The United Kingdom comprises England, Scotland, Wales, and Northern Ireland. Among them, the “leave” side won in England and Wales, while most voters in Scotland and Northern Ireland voted to remain. Leaders in both places have said they will explore options to continue their relationship with the EU.
In Scotland, the “remain” camp won by a 62 percent-to-38-percent margin. Nicola Sturgeon, Scotland’s first minister, says those numbers mean Scotland wants to continue its relationship with the EU, and, she says, a referendum on Scottish independence from the U.K. “must be on the table, and it is on the table.”
This would be a second Scottish referendum on independence. The previous one, held in 2014, was close. It had an 84 percent turnout, and the side that campaigned for continued union with the U.K. won with 55.3 percent of the vote; those who wanted independence won 44.7 percent.
Turnout in Scotland for Thursday’s referendum was 68.4 percent—far lower than the figure for the rest of the U.K.
Northern Ireland also voted for the U.K. to remain, by a 56 percent-to-44 percent margin. First Minister Arlene Foster of the Democratic Unionist Party, the predominantly Protestant grouping, said the results showed “we are now entering a new era of an even stronger United Kingdom.” But Martin McGuinness, the deputy first minister, who belongs to Sinn Fein, the political wing of the Irish Republican Army, says the results show Northern Ireland should be able to vote on a union with the Republic of Ireland, which is an EU member.
Dragging us out of Europe will be to the detriment of all our citizens and will be bad for business, trade, investment, and wider society. I, and all Sinn Fein ministers will work to ensure the political institutions remain on a stable footing, but it is very difficult to put detailed contingencies in place until we know the extent of the impact of Brexit on our finances, our infrastructure and health services. All of that is still subject to a negotiation but the fact is that we are in unchartered waters. Sinn Fein will be seeking an urgent meeting with the Irish government, the European institutions and also with our counterparts in Scotland to discuss how we move forward in the best interests of all of our people.
Britain’s unlikely to cede any control over Gibraltar, however.
What happens to the expats?
This is a complicated question that has consequences for millions of people across the EU. About 1.3 million Britons live in EU countries (Spain, Ireland, and France are their top destinations). About 3 million EU citizens live in the U.K. (Poles, Irish, and Germans are the top three groups). Nothing changes for any of them until the U.K. officially leaves the EU. But as the U.K. negotiates the terms of its exit, the fate of these approximately 4.3 million people is likely to be a top concern. The two sides could continue to allow the free right to work—but that’s unlikely given how European immigration to the U.K. was seen as a driver for the vote to leave. What we are likely to see are restrictions on the movement of workers that range from limited to extreme.
Some EU citizens might have to apply for work permits to live and work in the U.K., which at present has a points-based system for workers from outside the EU. U.K. expatriates in Europe may have to apply for a Blue Card work permit in EU countries, which have restrictive rules for non-EU citizens looking to live and work within their borders. There are also tax and inheritance consequences for expatriates who own property in the U.K. and the EU.
Are there economic consequences?
If the global markets Friday are to be believed, then the answer is yes. But one day’s data does not an economic trend make, so we’ll point you to the boatloads of mainstream economists and international financial institutions that predicted dire economic consequences in the event of a “leave” vote.
Fed Chair Janet Yellen warned of “significant economic repercussions.” Roberto Azevedo, the head of the World Trade Organization, said leaving the EU would cost Britons an extra $13.2 billion in import tariffs. The nonpartisan Institute for Fiscal Studies warned that Britain could face two more years of austerity measures if it votes to leave the EU. The OECD said Brexit would constitute a tax of £2200 per household per year (about $3,000) by 2020 and up to £5000 ($6,817) by 2030. International Monetary Fund chief Christine Lagarde said the impact of Brexit on the U.K.’s economy could range from “pretty bad to very, very bad.” And, finally, Mark Carney, the governor of the Bank of England, warned the consequences “could possibly include a technical recession.”
What about the impact on rules and regulations?
The FT says untangling U.K. rules from the EU’s “would take years and could create constitutional mayhem.” The “leave” vote has consequences not only for British citizens, companies, and public authorities, but also London’s relationship with Scotland, Wales, and Northern Ireland. Laws in those places say acts of their legislative bodies that don’t comply with EU rules are not law.
The problem, as the FT points out:
The nature of the British legal system poses particular challenges for those wanting to roll back existing EU legislation: much of it has been incorporated into British law and tested in the courts, and has thus become part of case law. This means that, even if a statute is removed, its principles — for example, on legislation governing workers’ rights — would remain in force.
To put the scale of what’s happening in context, here’s Daniel Shurman, a partner at Allen & Overy, who told the FT Brexit was a case “of the world’s fifth-largest economy leaving the world’s largest trade bloc.”
“If one wanted to rewrite the many thousands of pages [of relevant legislation] from the start it would obviously be an incredibly complex and time-consuming task,” he told the newspaper, “and I don’t think people have fully fathomed the challenge.”
What’s next for the EU?
This too is a complicated question. There were fears that Britain’s exit would energize Euroskeptics across the bloc. Indeed, polls in Denmark have suggested that the country would vote to leave if a referendum were held on membership (none is planned). Far-right parties across Europe rejoiced at the news from Britain Friday. Marine Le Pen, the head of the National Front in France, said on Twitter: “Victory for Freedom! As I have been asking for years, we must now have the same referendum in France and EU countries.” Similar sentiments were expressed by others across the bloc. Whether that translates to referenda in those countries and subsequent votes to leave is an unknown, however.