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Everything you need to know about the Brexit divorce deal

The agreement ensures no hard border will exist between Northern Ireland and the Republic of Ireland, enshrines the rights of EU citizens in the U.K., and will see the the British taxpayer foot a financial settlement of around $65 billion.

by David Gilbert
Dec 8 2017, 6:52am

British Prime Minister Theresa May quit Downing Street’s Christmas party Friday to fly to Brussels and rubber-stamp a Brexit divorce deal that will allow the U.K.’s extrication from the EU to move to the next stage.

The agreement ensures no hard border will exist between Northern Ireland and the Republic of Ireland, enshrines the rights of EU citizens in the U.K., and will see the British taxpayer foot a financial settlement of $52 billion.

Backers of May hailed the deal as a personal victory for a beleaguered PM, while critics noted the accord amounted to a huge climbdown in the face of dogged intransigence by EU negotiators.

Either way, May now faces the difficult task of securing a favorable trade deal with an EU that comes to the negotiating table in a far stronger position. As President of the European Council Donald Tusk warned, getting to this point was the easy part: “We all know that breaking up is hard. But breaking up and building a new relationship is much harder.”

What has the U.K. agreed to?

  • The Irish border: The issue of the post-Brexit border between Northern Ireland (Britain) and the Republic of Ireland (European Union) had prevented the divorce process from moving forward. Last week the Northern Irish Democratic Unionist Party — on whose votes May relies in Westminster — opposed a deal that would give their country special status within the U.K. to having regulatory alignment with its neighbor. The new deal says the U.K. has committed to finding a way around that impasse. If it doesn’t, Northern Ireland will be forced to abide by the EU’s single-market and customs-union rules — without having a say in them.

  • Money: The U.K. has agreed to contribute to the EU budget through 2019 and 2020, as well as pay the one-off divorce bill.
  • Citizens’ rights: The deal guarantees the right to stay for EU citizens living in the U.K.and vice versa. Rights of children and partners in existing “durable relationships” are also guaranteed. But the deal also allows European courts to have a say in cases relating to EU citizens in the U.K. for up to eight years after Brexit.

What has the reaction been?

  • “Leave” campaigner Nigel Farage: “It’s not Brexit; we voted to leave the European Union. [May] has given a foreign court jurisdiction over us for many years to come.”

  • Irish Taoiseach Leo Varadkar: “I am satisfied that sufficient progress has now been made on Irish issues, the parameters have now been set and they are good. This is not the end but it is the end of the beginning.”
  • EU Council President Donald Tusk: “While being satisfied with today’s agreement, which is obviously the personal success of Prime Minister Theresa May, let us remember that the most difficult challenge is still ahead.”

  • DUP Leader Arlene Foster: “It means there is no red line down the Irish sea. We have the very clear confirmation that the entirety of the United Kingdom is leaving the European Union.”
  • European Commission President Jean-Claude Juncker: “Today’s result is of course a compromise. This was a difficult negotiation for the European Union as well as for the United Kingdom.”

What happens next?

The formal process of opening phase 2 of the Brexit talks will happen at an EU leaders summit next week. To speed up the process, the U.K. has asked the EU to issue “guidelines.” Having seen a draft of the document, BuzzFeed reported the EU will ask the U.K. to remain in the single market and customs union for two years after Brexit.

The 27 EU member states will next debate what they want to prioritize in trade negotiations with the U.K.; Britain will want this done quickly, but EU members are unlikely to rush the process.

“They took nine months [on divorce], so why should we not take a little time on the future?” one senior EU official told the Financial Times.

Those talks must finish by October 2018 to meet an EU deadline that will allow ratification of the deal ahead of the March 31, 2019, deadline for the U.K. to finally leave the EU.