Brexit Essentials 10: the WTOSep 2016 | Newsletter/briefing
Trade deals between the EU and non-EU states take between four and nine years to conclude on average. The Government has warned that the negotiation of an ambitious trade deal with the EU could take several years.
Article 50(3) of the Treaty on the Functioning of the European Union provides that the EU Treaties will cease to apply to the United Kingdom from the date of the entry into force of any withdrawal agreement or, failing that, two years after the notification to the European Council of the United Kingdom’s intention to withdraw from the EU. This period can only be extended by unanimous agreement of all Member States.
If a satisfactory agreement on trade in goods and services cannot be negotiated between the United Kingdom and the EU within this timeframe, the rules of the World Trade Organization (“WTO”), which provides a global multi-lateral agreement on the trade in goods and certain services between members, offer a default option.
This briefing summarises the basic principles of WTO law as they would apply to trade between the United Kingdom and the remaining EU Member States as well as the rest of the world, if the United Kingdom were to exit the EU without having negotiated a formal agreement governing its future trading relationship with the EU.
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