David Davis: Britain Could Withhold Agreed Divorce Bill Payment From EU If It Doesn’t Get A Trade Deal

By Robert Sharp / englishpen (Simon Singh Press Conference) [CC BY 2.0 (http://creativecommons.org/licenses/by/2.0)], via Wikimedia Commons

David Davis has suggested that the United Kingdom could withhold payment of its Brexit divorce bill if the European Union does not give it a trade deal.

The Brexit Secretary was questioned about reports regarding a “secret plan” to withhold the payment that was agreed upon last December and said that the issue was “bound up into one” with a discussion on the future relationship of the United Kingdom.

In a question-and-answer session after a speech in Vienna, he informed reporters: “Secret plan – as announced by the Prime Minister.

“We have been very plain that the withdrawal agreement follows Article 50. Article 50 says the withdrawal agreement has to take into account the future relationship. They’re bound up in one; they’re not a separate issue.”

The said statement is the clearest yet that the United Kingdom does not consider that the £39bn sum of liabilities was already a done deal. It is likely to spur anger Brussels – where officials were not impressed after Davis suggested that the deal was not legally binding late in 2017.

The issue is of such concern for the European Union that it has prioritised converting the phase one deal – which covers enough progress on the bill, the Northern Ireland issue, and citizens’ rights– into a legally binding document.

The departure of the United Kingdom is already leaving the European Union with a major budget hole and the withholding of the financial settlement, which covers the already agreed liabilities, would be extremely difficult for the member states European Union financially.

Last September, Michel Barnier, the European Commission chief negotiator, spoke of a “problem of confidence” with the approach of the United Kingdom to discussions– a perception that the comments of Davis are likely to inflame.

Davis utilised his speech to spell out the favoured conditions of the United Kingdom for a trade deal following Brexit, in which the European Union recognised British regulations even if they are different from European ones.

Talking to business leaders in the Austrian capital, the Brexit Secretary dismissed the idea that the United Kingdom has to stay aligned with the regulations of the European Union in order to avoid trade barriers. He also urged for “mutual recognition” between the two regulatory regimes in order to avoid cutting British companies off from the continent.

However, earlier this month, Barnier had said that if the United Kingdom left the single market and the customs union, “barriers to trade in goods and services are unavoidable.”

As expected by many, Davis used the speech to try and pacify concerns that the United Kingdom could try and cut regulations after leaving the bloc, saying that Britain would not turn to a “Mad Max” society, in reference to the dystopian film.

He said that Britain had in fact been at the heart of shaping regulations of the European Union and usually went beyond European standards in various areas.