UK Decision to Leave the EU – Brexit

What is it all about?

While the British people voted to leave the European Union ('EU') in June 2016, it will take several years for the UK to negotiate the terms of its exit from the EU. Nothing will change for Australians while the UK remains an EU member.

Australia remains fully committed to the UK as an indispensable friend and ally. We also remain fully committed to our relationship with the EU, which is equally based on shared interests and common values.

Prime Minister Turnbull, Foreign Minister Bishop and Trade, Tourism and Investment Minister Ciobo have met their UK and EU counterparts several times since the Brexit vote and remain committed to preserving and advancing Australian interests.

Overview

What happened?

Britain held a referendum on 23 June 2016 to answer the question: "Should the UK remain a member of the EU, or leave the EU?" By a margin of 51.9 per cent to 48.1 per cent, the UK voted to leave the EU (commonly referred to as 'Brexit'). A breakdown of votes by region is listed below.

  Remain Leave
England 46.6% 53.4%
Scotland 62.0% 38.0%
Wales 47.5% 52.5%
Northern Ireland 55.8% 44.2%

What is the European Union?

The EU is an economic and political partnership of 28 member countries (including the UK). It is often described as a 'single market' facilitating the free movement of goods, services, capital and people (sometimes referred to as the four freedoms) – as if member states were a single country.

The EU is also a customs union, or a group of countries with a common external tariff. The Eurozone (also referred to as the Euro area) is a monetary union of 19 of the 28 EU member states which have adopted the Euro as their currency. The UK is not a member of the Eurozone.

What does Brexit actually mean?

Article 50 of the Treaty of Lisbon provides the legislative framework to negotiate Britain's EU withdrawal. Under the Article, member states must formally notify the EU of their intent to withdraw. On 29 March 2017, the UK Government invoked Article 50, triggering a two-year period in which the UK and the EU must determine the terms of the UK's exit.

If agreement is not reached within this two-year period, the UK will be forced to leave the EU with no provisions in place – unless the UK and all remaining member states agree to extend negotiations.

The UK will also need to establish the parameters of its WTO membership. The UK, like all EU member states, is currently a WTO member in its own right, but its tariff and services obligations are those of the EU.

The UK will need to create its own WTO schedules for goods and services. An early priority for Australia is to clarify our interests in revised UK and EU27 WTO tariff schedules – to maximise market access for Australian exports to both the UK and EU.

What progress has been made in negotiations between the UK and EU?

The first formal meeting between EU and UK negotiators was held on 19 June 2017. Further negotiating rounds have taken place since.

The UK Government has begun releasing a series of policy discussion papers for public consultation. These papers set out the UK Government's vision for its new partnership with the EU and identify key issues that will need to be addressed to achieve that vision. A full list of papers is available on the UK Government's website: Article 50 negotiations with the EU

Further to these discussion papers, UK PM May gave a speech on 22 September providing greater detail on the UK's negotiating position, including the need for the UK and EU to establish a transition period beyond March 2019: PM May 22 September speech

The EU Commission has also published position papers on the Article 50 negotiations with the United Kingdom: Article 50 negotiating documents

The UK's Great Repeal Bill, which aims to convert the body of existing EU law into UK domestic law, was introduced to Parliament in July 2017. Transferring current legislation in this way is intended to provide legal continuity from the day of departure. The Bill is currently at the second reading stage.

What is the Australian Government doing to protect Australian interests?

The Australian Government is paying close attention to the UK's exit negotiations. The Australian Government has convened a whole-of-government coordination process to assess the implications of Brexit for Australia, ensuring that any risks posed by Brexit are addressed, while also identifying opportunities to enhance our relationships with the UK and EU within existing legal frameworks.

Can Australia begin FTA negotiations with UK?

The UK will need to complete its exit negotiations with the EU, and determine its domestic trade and regulatory settings, before it is able to negotiate FTAs with third countries, such as Australia.

Prime Minister Turnbull and UK Prime Minister May have signalled interest in negotiating an Australia-UK FTA as soon as the UK is in a position to do so.

In the meantime, Australia and the UK have established a Joint Trade Working Group. Its work is focused on scoping out the parameters of a future comprehensive FTA and exchanging views on global trade policy issues and developments.

What does Brexit mean for business?

There will be no changes to the rules covering our trade and investment interests and people-to-people ties with the UK and EU while the UK remains within the EU. The Government is continuing to seek clarity from the UK Government on its expected approach to EU departure to better identify possible future implications for Australian businesses operating in the UK.

Are there any implications for Australians seeking to live and work in the UK?

The UK Government has announced it plans to retake control over its immigration policy when it departs the EU.

Though no specific policies have yet been announced, UK Home Secretary Rudd has said she intends to commence a broad consultation process covering student visa and work routes into the UK. In particular, consultations will assess companies' processes for hiring foreign workers, and the terms of student visas.

Australian ministers have impressed upon their UK counterparts the importance of ensuring prospective visa changes do not negatively impact the strong economic and people-to-people links between Australia and the UK.

Will dual nationals with Australian and British passports still be able to live and work in the EU?

The UK Government has said that nothing will change in the short term for British passport-holders living, working, and travelling in the EU. This includes Anglo-Australian dual nationals. Whether this state of affairs will continue in the future will depend upon the terms of any exit agreement reached between the UK and the EU.

Has the UK's decision to leave the EU impacted Australia-EU trade negotiations?

No. The Australian Government remains firmly committed to securing an FTA with the EU. Australian and EU officials have completed a joint scoping exercise on an Australia-EU FTA and are working toward a launch of formal negotiations.


View a larger version
Last Updated: 20 October 2017

 

 

Contact us

EU trade-related submission can be submitted to the addresses listed below.

Email: a-eufta@dfat.gov.au

Mail:
Australia-European Union Free Trade Agreement
Europe Division
Department of Foreign Affairs and Trade
RG Casey Building
John McEwen Crescent
Barton ACT 0221