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Brexit: will the UK sue the EU?

Brexit: will the UK sue the EU?
By Catherine Hardy with Reuters
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Brussels is damaging British interests by talking up the threat to companies if the UK leaves the EU without a deal.That is the claim from the UK's Brexit minister David Davis in a letter to his Prime Minister, Theresa May.


Brexit minister David Davis has complained in a letter to the prime minister that Brussels is damaging British interests by talking up the threat to companies if the UK leave the EU without a deal.

What does the letter say?

That Davis has sought legal advice over whether Brussels is breaching Britain's rights as a member state by advising companies of the risk to trading in the event of a "no deal".

It was first published by the UK Financial Times and confirmed as genuine by an aide from Davis's department.

"The EU has adopted a number of measures that put agreements or contracts at risk of being terminated in the event of a 'no deal' scenario and/or would require UK companies to relocate to another Member State."

"It's clear there have been a number of instances where the (European Commission), by treating the UK differently despite still being a member of the EU, have not acted in good faith," added an aide in the department, confirming the letter.

"It should be no surprise that if the Commission attempt to stoke fears about worst-case scenarios, we will correct them and reassure our firms."

Are there any examples?

Yes. They include EU agencies reportedly advising business that the UK would become a third country when it leaves the EU in March 2019, without referring to Britain's aim to agree a transition period and future trading deal first.

The advice, Davis says, also implies companies would need to be based in the EU or European Economic Area in order to maintain compliance with regulatory rules.

So what does Davis plan to do?

He says in the letter that legal and policy advice suggest the chances of a successful legal challenge are slim. He adds that he has instructed his department to increase its engagement with the Commission - the EU's executive arm - and companies to reassure them.

Who is David Davis?

He heads the Department for Exiting the EU. It was set up to implement Britain's 2016 vote to leave the bloc.

Has the European Commission said anything?

Yes. It has rejected suggestions there was any breach of EU law in its approach.

"We are somehow surprised that the United Kingdom is suprised that we are preparing for a scenario announced by the UK government itself. We take these words by the prime minister very seriously. It is therefore only natural that in this house we also prepare for every eventuality," said the Commission chief spokesman Margaritas Schinas, referring to Theresa May's statement last year that the UK would prefer "no deal" tp a "bad deal".

Brexit - deal or no deal?

Britain and the EU struck a divorce deal in December that paved the way for talks on future trade ties.

May's government has said it is preparing for any outcome, including the chance that Britain could crash out of the bloc without a deal and has set aside an extra three billion pounds to prepare for all eventualities.

Europe's Brexit negotiator Michel Barnier has repeatedly warned that a no-deal scenario would have a damaging impact on people, companies and trade.


What the critics are saying

British opposition politicians ridiculed Davis for appearing to attack the EU for preparing for an outcome that Britain itself says is possible.

"David Davis laments that the EU are preparing for No Deal Brexit and the damage it will do to British business, when we are spending three billion pounds doing the same thing," tweeted opposition Labour MP Chuku Umunna.

"If it is damaging to British business, why are the government even contemplating it?" asked Nicola Sturgeon, leader of the Scottish National Party.

"Business uncertainty has been created because of the UK government's decision to leave the single market, not because of EU contingency planning," the European Parliament's Brexit coordinator Guy Verhofstadt said on Twitter.

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