Brexit and the Single Market: You say Article 50, we say Article 127?

von Tobias Lock

Hard on the heels of the Article 50 case heard last week by the UK Supreme Court, comes the announcement of another challenge to the UK Government’s Brexit plans, this time based on Article 127 of the EEA agreement. Much like Article 50 TEU, that provision allows contracting parties to the EEA agreement to withdraw from it. As an EU Member State the UK is also a party to the European Economic Area (EEA), which – in a nutshell – extends the EU’s single market to three further countries – Norway, Iceland, and Liechtenstein. All three are members of the European Free Trade Association (EFTA).

The claimants in the Article 127 challenge contend that withdrawal from the EU under Article 50 will not lead to withdrawal from the EEA, given that with Article 127 the EEA agreement contains its own termination clause. Hence their argument goes that unless the Government also triggers Article 127, the UK will stay in the EEA even after Brexit; and that would mean that the UK would remain in the single market.

Much like the Article 50 case, the impending court case therefore seeks a declaration by the High Court that the Government cannot trigger Article 127 without prior approval of Parliament. The claimants’ hope is that while Parliament may feel politically bound by the EU referendum result to allow the Government to leave the EU, it may not vote in favour of leaving the EEA, viz. the single market, as this was not a question on the ballot paper.

It is the aim of this blogpost to identify the three main hurdles the claimants are likely to be facing and discuss whether these can be overcome.

The first hurdle will be to convince the High Court that the UK would formally remain a member of the EEA even after withdrawal from the EU. The main issue in this regard is that the EEA agreement is really an agreement between the EU and EFTA states. It is only open to members of either organisation and not to third countries ...

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