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EBS Ltd, Innovation Centre, Gallows Hill, Warwick, CV34 6UW

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EBS Ltd, 118 Pall Mall, London, SW1Y 5EA

brexit 1462470595lr3

Brexit- What happens next?

The UK voted in the Referendum by a very narrow margin to leave the EU. But it is not as simple as that.

The process of leaving begins when the UK writes formally to the EU, specifically commencing the process set out in Article 50 of the Lisbon Treaty.

The Referendum is technically not binding on Parliament, the overwhelming majority of MPs preferring Britain to stay in the EU. The Prime Minister, Mr Cameron, has said he will step down for a new leader of the Conservative Party to be appointed, sometime in the Autumn, and he will not invoke Article 50, believing that this should be done by the new Prime Minister.

The leader of the “Out” side, Mr Johnson has said that he believes that the EU and the UK will retain access to each other’s markets. Mr Johnson adds that “Immigration was not the main issue in the Referendum” and a spokesman for Mrs Merkel has already commented that access to the EU Market for the UK is perfectly possible if the UK pays a contribution to the costs of the market in a similar way to Norway. Incidentally, this model also involves, for all practical purposes, free movement of people.

Then what is going to change I hear you ask, and my opinion is “Not very much”. The UK and the EU will continue to be effectively a free trade area, there will be movement of people and the UK will contribute to the costs. What the UK will not have is oversight by the European Parliament, any prospect of being dragged into the Euro, and no involvement in the EU concept of “Ever closer Union”.

Now comes the question of how, if they wished, could the Members of Parliament find a way to override the Referendum decision? It is actually quite easy, and that is to force a General Election, before Article 50 is invoked, with a specific policy to remain in the EU. That would democratically negate the Referendum result as the winning side would have a specific mandate from the electorate.

But there are other issues. Clearly there is some dissatisfaction in the UK with how the EU is managed, and the perception of how this impacts on their daily lives. But the people of the UK are not alone in this feeling; there are a number of other EU countries where there are growing political movements looking for change. Politicians will need to recognise that they are out of touch with the desires and aspiration of their populations, both at a national and European wide level, and further that this isolation of the political classes must stop if the dreams and ideals which created what is now the EU are to survive.

If the UK leaves without a sensible and realistic trade deal in place it will take with it the second largest contribution to the EU budget, which will force major and undoubtedly unwelcome changes to many EU programmes. And it will start other similar “exit” demands in other countries.

Can Britain stand alone outside the EU? Well yes. Britain is less dependent on trade with the EU than any other major European country. It has the 5th largest economy in the world. Whatever its status it cannot be ignored, and others will still want, and indeed need, to trade with it.

It is my belief that common sense will prevail, that the United Kingdom and the EU will trade together as they have before, that people will move freely amongst the countries of Europe, and that Britain will continue to make a strong contribution, both politically and financially, to European life.

And maybe, just maybe, if all sides engage in a positive way, then considerable good can come out of this.

Written by Martin Williams, Managing Director of EBS

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