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the The European Union is taking legal action against the UK over Boris Johnson’s plan to violate the terms of his Brexit divorce deal and violate international law.
“The committee has decided to send a letter of formal notice to the British government,” European Commission President Ursula von der Leyen announced Thursday in Brussels. “This bill constitutes, by its very nature, a violation of the duty of good faith set out in the Withdrawal Agreement.”
The pound fell 0.7% against the dollar on the news. The letter is the first step in a legal process against the UK’s Home Market Bill which could lead to a lawsuit at European Court of Justice.
Read more: How Johnson is risking the UKof Reputation, trade agreements: QuickTake
Although this decision has few immediate consequences, it underlines that tensions are high as trade negotiations enter a critical phase. Von der Leyen gave the UK one month to respond.
A Johnson’s office statement said the government “would respond to the letter in due course.”
The UK was waiting for the letter and the European Commission sends dozens of such notifications to member states every month on various cases of alleged violations of EU law. An exchange of letters and explanations follows, before some of these cases reach EU courts.
It is not unusual for the EU to take legal action against countries and as soon as the UK admitted its plan was in violation of the Withdrawal Agreement, such a move became inevitable. But officials on both sides say privately they don’t want this to overshadow negotiations on a future trade deal. They hope that if they come to an agreement on this, the hassle about the lawsuit will slowly fade into the background.
Back to UK
Prime Minister Boris Johnson has risked a chaotic and bitter separation from the EU with his plan to introduce legislation that would replace parts of the Brexit Withdrawal Agreement he signed, which would conflict with the law international.
Critics, including the five living former British prime ministers, say the law will undermine the UK’s position in other international disputes.
The Home Market Bill passed its final stage in the House of Commons on Tuesday and will move to the House of Lords, where Johnson’s The Conservative Party does not have a majority. Ministers expect the bill to be savagely there, according to people familiar with the matter.
Johnson’s defeat would rob him of bargaining power in the later stages of trade talks with the bloc.
The bill had been seen as an attempt by the UK to get better terms from the EU by threatening Northern Ireland’s status. Without a deal, the UK will exit the single market and the EU customs union on December 31, burdening businesses and consumers with additional costs and disruption.
The UK agreed that for treaty obligations breached before the end of the transition period, it would remain subject to decisions of the European Court of Justice for another four years. But the British could choose to ignore them, especially if they include financial sanctions, which would be another violation of the treaty.
The Withdrawal Agreement provides for a five-member arbitration panel to rule on non-compliance issues from next year. Again, the panel may impose financial penalties. If the UK still refuses to pay, the EU can suspend the Withdrawal Agreement at will, except for the citizens’ rights parties.
The biggest penalty would be if the EU refuses to enter into a trade or other agreement with the UK, denying Britain access to its largest and closest economic partner.
(Updates with context in the last three paragraphs. An earlier version of the story corrected the spelling of the name of the President of the European Commission.)