What will happen on March 29th?

11th March 2019.

Officially the UK is still expected to leave the European Union on March 29th. But with talk of a delay, what happens in the coming days and weeks remains unclear. There are still plenty of questions that remain unanswered.

Download pdf of our full Brexit, the 29th March report .

Brexit a stockbroker view

What is the sticking point?

The first vote in January saw the deal rejected by 432 votes to 202, the largest defeat for a sitting government in history. The Prime Minister is seeking legally-enforceable changes to the backstop – a controversial insurance policy designed to prevent physical checks on the border between Northern Ireland and the Republic of Ireland – but there have been few visible signs of progress.

Leading Brexiteers are looking for reassurances that the backstop – which would see the UK aligned with EU customs rules until the two sides’ future relationship is agreed or alternative arrangements worked out – will not endure indefinitely.

The European Commission said on Wednesday that “no solution has been identified” to the Irish backstop and it has refused to rewrite the withdrawal deal already struck, which is designed to ensure an orderly Brexit on March 29th and pave the way for trade talks.

But Foreign Secretary Jeremy Hunt told the BBC the UK’s demands were “not unreasonable” and it was “entirely possible” there would be a breakthrough in the next few days.

He told BBC that the other 27 EU members needed to be flexible if they were to get MPs onside and suggested the EU would be blamed “if this ends in acrimony”.

Two former prime ministers, Sir John Major and Gordon Brown, have called for a delay of a year to allow for a “public consultation” on the way ahead and to ensure an orderly exit.

Mr Brown told the BBC if Parliament could not resolve the situation “the only way that we can get unity in this country is by involving the people in trying to find the solution”.

What is happening in Brussels?

Attorney General Geoffrey Cox is back in Brussels as he continues efforts to find legal assurances over the temporary backstop arrangements for the border with Ireland. Brexit Secretary Stephen Barclay will also be present for the talks with the EU’s Michel Barnier. Apparently, Cox has abandoned efforts to secure either a fixed time limit for the measures or a unilateral exit mechanism which would allow the UK to terminate the arrangements which Brexiteers fear will trap the UK within the EU’s customs union.

Whatever concessions he does manage to secure in Brussels will be closely scrutinised by Tory and DUP Brexiteers before Theresa May faces a showdown with MPs over the revised deal.

What is happening in Westminster?

The prime minister has promised to bring her revised Withdrawal Agreement and Political Declaration back for another “meaningful vote” by March 12th at the latest. The last time her Brexit deal was voted on by MPs, May suffered a humiliating 230-vote defeat.

Labour has indicated it will use the meaningful vote to support a call for a referendum on a Brexit deal. If May’s deal is rejected again, MPs will vote by March 13th at the latest on whether they want to leave the EU without a deal.

Should MPs reject a no-deal Brexit, there will be another vote on March 14thon whether parliament wants to seek a “short, limited extension to Article 50” – delaying the UK’s departure beyond the current March 29th deadline.

The aim of a delay would be to give extra time to reach an agreement with Brussels that can be accepted by MPs but May stressed that it would not take the prospect of a no-deal Brexit off the table but would instead create a new deadline.

Brexit deadline

How could Brexit be delayed and for how long?

To secure an extension to Article 50, May would need the support of the 27 other EU states. They are likely to agree to an extension as long as there is a prospect of a deal being reached – or a referendum or general election which could change the political picture at Westminster.

The looming European elections in May present a problem, with the UK currently not expected to take part. That would limit any extension of the UK’s membership of the EU until the end of June, as the newly-elected parliament sits in July. If a longer extension was sought, that would mean taking part in the elections, something likely to fuel Brexiteer anger – and potentially see Nigel Farage standing for the new Brexit Party.

So, what happens on March 29th?

Impossible to say at this stage. If there is a deal, with a transition period, then although the UK will formally leave the EU at 11pm, very little will change.

If there is a delay, the UK will still be in the European Union until the extension period expires.

The worst-case scenario is if there is a no-deal Brexit, things are a lot more uncertain – the government has been ramping up preparations to try to prevent shortages of food and medicine amid fears that increased bureaucracy will clog up key ports where goods arrive from the continent.

Receive Latest News

Risk Warning - All investments carry risk and prices may change quickly. The value of your portfolio can go down as well as up. Past performance will not necessarily be repeated and is no guarantee of future success. You should carefully consider in light of your financial resources whether investing in stocks and shares is suitable for you. This notice cannot disclose all of the risks and other significant aspects of investing in equities, derivatives, bonds or any other investment product. A full list of risks will be provided for the products which you are interested in. For more information please contact one of our team.