September 26, 2019 / 10:27 AM / 22 days ago

Latest Brexit twist leaves EU expecting another delay beyond Oct.31

BRUSSELS (Reuters) - A damning UK Supreme Court ruling against British Prime Minister Boris Johnson this week has rekindled discussion within the European Union about another delay to Brexit, with the bloc drawing a line in the sand of mid-2020 at the latest.

FILE PHOTO: Flags flutter outside the Houses of Parliament, ahead of a Brexit vote, in London, Britain March 13, 2019. REUTERS/Tom Jacobs

The British parliament resumed on Wednesday after the court ruled that the chamber had been unlawfully suspended by Johnson, who insists he will take Britain out of the EU on Oct.31 - with or without a deal to manage the fallout.

But British lawmakers reject the most damaging, no-deal Brexit and, back at work, will now have more chance to upset Johnson’s plans.

With the divorce deal stalled, the EU is expecting another delay to Britain’s departure date after it was already postponed twice from the original March deadline.

“We are in favour of an extension if we also see what is the way forward, will there be a general election, a second referendum, will there be a Withdrawal Agreement,” said Guy Verhofstadt, an EU lawmaker dealing with Brexit.

“I think that there is unanimity...to say ‘OK, let’s go forward with an extension if there is a clear path to a solution and unwinding of the situation we have today’,” he told EU lawmakers on Wednesday afternoon.

With a national election expected in Britain by the end of the year, the bloc currently sees that as the most likely justification of anther lag - a decision that would require the unanimity of the 27 states staying on.

The problem is, however, that Britain would need to request such an extension, which Johnson vows never to do and EU Brexit watchers speculate about him possibly stepping aside to let someone else make the step.

Under the law, the EU could also formally demand a delay - which Britain would need to agree to for it to take effect.

But diplomats and officials dealing with Brexit in the bloc’s hub Brussels ruled out such a possibility, saying it would risk feeding Johnson’s rhetoric about distant elites trying to frustrate the will of the people.

SHORT OR LONG?

With many question marks over the fate of Brexit lingering three years since Britons voted out, EU leaders meeting in Brussels on Oct.17-18 will discuss the desirable length of any such delay.

The British prime minister will not be allowed in the room.

The House of Commons has passed a law demanding that London seeks a postponement until the end of January 2020 to avoid an abrupt split on Oct.31 should no new divorce deal be reached at the EU summit in three weeks time.

“January may be a bit too soon for us,” said one EU diplomat. “It is far from clear that Britain would be able to sort itself out by then and we would risk another summit at the turn of the year to push back another no-deal prospect.”

“A six-month delay until the end of March might be better for us,” the person said under condition of anonimity.

Brexit weighs heavily on the EU’s work on its next long-term budget from 2021 and several diplomats said there could be no more extensions beyond mid-2020, when the bloc needs to have clarity on whether Britain would go on paying.

“It could be one long or two shorter ones. Regardless, the cut-off date is in the middle of next year because we need to be able to finalise our own budget in the second half of 2020 at the latest,” said a senior EU diplomat.

A third diplomat stressed the message: “We have no problems with extensions as long as they do not impede with us finalising the budget, which must happen in the second half of 2020.”

Another risk for granting Britain an extension next month is the more hawkish stance by French President Emmanuel Macron who, backed by the increasingly expasperated Belgian and Luxembourg leaders, has opposed granting the latest delay until Oct.31.

His camp stresses the cost of protracted uncertainty in terms of sapping the EU’s political capital and attention needed to face challenges from climate to migration to international crises, as well as economic cost for companies who have invested in expensive contingency preparations for a no-deal Brexit.

“This is a nightmare,” Luxembourg Prime Minister Xavier Bettel said at the top of his voice in an emotional speech this week that highlighted the EU’s growing fatigue with the tortuous process. “People would love to have clarity.”

Despite that, most EU diplomats and officials currently believe the bloc would grant Britain another Brexit lag - should London request it - to avoid taking the blame for disruptions expected in any no-deal split.

Reporting by Gabriela Baczynska; Editing by Angus MacSwan

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