Brexit: What is it, and what does it mean?

Francisco A. Laguna & Amy Turner

Last week, we began our series on Brexit by focusing on 3 potential winners:  continental capitals ready and able to replace London as commercial hubs from which to benefit from doing business in the European Union.  This week, we provide some historical context for Brexit.

Anyone with a television, computer or smartphone has heard of Brexit.  Commonly, Brexit is the process where the United Kingdom will formally sever its political ties with the European Union. While the name Brexit is new, the concept is old. Since 1973, when the UK joined the European Economic Community (EEC), the predecessor to the EU, certain UK political parties and advocacy groups have been advocating “opting out”.

The original “Brexit Vote” was on 5 June 1975. The UK held a referendum, during which, the electorate was asked to vote yes or no on the question: “Do you think the UK should stay in the European Community (Common Market)?” By a vote of 67.2% in favor voted positively that the UK should remain a member of the EEC.  The 1975 vote was thought to have put the question to rest. However, the idea was resurrected again in 2012.

By LucasD - Own work, CC BY-SA 4.0, https://commons.wikimedia.org/w/index.php?curid=50118738

By LucasD – Own work, CC BY-SA 4.0, https://commons.wikimedia.org/w/index.php?curid=50118738

In 2012, Prime Minister Davis Cameron dismissed calls for a vote on UK’s EU membership, with a caveat of a vote at a later date to take the pulse of the public.  The years of 2012- 2013 saw the rise of UKIP (United Kingdom Independence Party). UKIP’s rise gave enough political power to groups wanting a “Brexit” to successfully pressure Prime Minister Cameron. An official announcement by Cameron was made in January 2013 that if a conservative government was elected in 2015 an in-out referendum on EU membership would be held before 2017. The UK went to the polls and elected a Conservative government, and the party kept its promise, reintroducing the European Union Referendum Act 2015.  On February 22, 2016, Cameron went before the House of Commons and put forth a date of June 23, 2016 for a referendum. In his speech Cameron also laid out the legal parameters for a withdrawal in which he cited the need to immediately trigger Article 50 of the Lisbon Treaty.

By Jwslubbock - Own work, CC BY-SA 4.0, https://commons.wikimedia.org/w/index.php?curid=50299666

By Jwslubbock – Own work, CC BY-SA 4.0, https://commons.wikimedia.org/w/index.php?curid=50299666

On June 23, 2016, the United Kingdom went to the polls and with a vote of 51.9% in favor of leaving the European Union and 48.1% against. The morning after the Brexit vote result, Cameron announced that he would resign by October.  On July 13 2013, Theresa May become Prime Minister. Prime Minister May made the decision that discussions with the EU would not start in 2016. She stated “I want to work with … the European council in a constructive spirit to make this a sensible and orderly departure.” Currently, neither a timetable nor the terms for withdrawal has been set. Therefore, for now, the UK remains a full member of the European Union.

In the next blog we will examine at the political ramifications of Brexit and discuss what the possible legal framework for departure would look like for the international community.

Call TransLegal with your questions concerning Brexit and how to prepare for the UK exiting the EU.

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