Voting on
Brexit
How do Members of the
European Parliament pick a
side?
Tijs van Oenen 10463194 Dr. L. Linsi Dr. T. Kuhn
Master Thesis Political Economy June 2018
Word count 16478
Abstract
This thesis analyses MEP voting behavior on three resolutions pertaining to the Brexit negotiation process between the EU and the UK. While traditional literature has focused on European party affiliation as the main predictor in voting behavior of the members of European Parliament, recent research has hinted that in specific cases where national economic factors are at stake national interests can influence voting behavior. This research focus on the influence of national interests on MEP voting behavior on Brexit resolutions. Because the negotiations between the EU and the UK are closed off, influence from the member states on the negotiations is limited to the votes in the European Parliament, which makes this research relevant. I expect to find that national interests do influence the voting behavior of MEP’s, because consequences of Brexit could have an impact on economic factors within their home countries. Findings show that no influence of national interests is witnessed, but European political party affiliation is the strongest predictor of MEP voting behavior.
Inhoudsopgave
INTRODUCTION ...3
THE EUROPEAN UNION ...6
MEMBERS OF EUROPEAN PARLIAMENT ...9
BREXIT ... 10
THEORY ... 12
DIMENSIONS WITHIN EUROPEAN POLITICS ... 12
Classic European Integration theory ... 12
A second Dimension ... 13
Multi-dimensional ... 14
FROM EUROPEAN POLITICS TO INDIVIDUAL VOTING BEHAVIOUR ... 15
RESEARCH DESIGN ... 17
KEY INTEREST INDICATORS ... 17
Trade ... 17
Foreign Direct Investment ... 18
Labour Mobility ... 18
European Union Budget Contributions ... 18
HYPOTHESIS... 19
METHODOLOGY ... 20
EMPIRICAL RESEARCH ... 21
EU-27 MEMBER STATE INTERESTS ... 21
EUROPEAN PARLIAMENT RESOLUTIONS ... 33
VOTING RECORDS ... 39 RESULTS ... 47 CONCLUSION... 49 BIBLIOGRAPHY ... 51 LITERATURE ... 51 EUDOCUMENTS ... 56 DATA ... 56
Introduction
The period after World War II onwards has been marked by growth and prosperity within Europe. With the creation of the European Union, economic, political and cultural integration have been steadily developed with a growing number of countries, resulting in a European Union with 28 member states. However, on June 23, 2016, the United Kingdom (UK) held a referendum on its membership to the European Union (EU). Although most of Britain’s establishment backed remaining in the EU, 52 percent of voters disagreed and handed a surprise victory to the “leave” campaign. Brexit, as the act of Britain exiting the EU has become known, can take place as soon as early 2019. Before the UK will formally exit from the European Union, a withdrawal agreement is going to be formulated. In this agreement the severance conditions for the Brexit will be captured, as well as the framework for the future relationship between the European Union and the United Kingdom, including among others trade relations, immigration laws and security concerns. These intricate matters will be discussed in a negotiation process between the EU and the UK, which has officially started on June 19th of 2017. The EU has decided that it will handle these negotiations by itself, allowing limited interference or mingling from the Member States. This resulted in the fact that one of the only formal ways for the Member States of the EU to exert their influence on the negotiations is through the European Parliament. The European Parliament will be consulted and kept up-to-date on the negotiations through several reports, and they are able to vote on the progress through several resolutions. These resolutions include the guidelines for the negotiations, regular progress reports, and will ultimately also include the withdrawal agreement.
In this research thesis I look at how the members of the European Parliament (MEP’s) have voted on these Brexit resolutions that have come through the European Parliament. Every one of these resolutions holds specific key interests, that range from citizen’s rights to financial obligations. Most of the Brexit resolutions that have been voted on in the European Parliament have passed, but a few have been rejected. I will assess the key interests of every Brexit resolution before looking how each MEP voted on each specific resolution. I will then map out how the MEP’s voted on each resolution, allowing me to identify how specific MEP’s vote on specific interests. Will their voting record line up with interests that have been linked to their home nation, will their voting record overlap with their European party ideologies, or will there be some other mechanism that triggers the voting motivation of the MEP’s? The goal of this thesis is to examine the voting record of the MEP’s on Brexit resolutions to determine what motivates their voting. The research question I answer is: “How can the voting record of Members of the European Parliament regarding the Brexit be explained?”
Throughout the years there have been growing research interests in the workings and voting records of the European Parliament. The European Parliament is an especially interesting subject of analysis because of several factors. First of all, in the last 20 years it has grown to become the largest interstate assembly in history. But also, the heterogeneity between different cultures, histories and so forth within the EU makes it more politically complicated than a traditional nation state (Hix, et al., 2006, p. 494). Furthermore, the legislators in the European Parliament are tied to several groups. They are members of national political parties, part of European party groups, and representatives of their home countries within the European Union (Hix, et al., 2006, p. 495). Research has given different accounts for the voting behaviour of the Members of the European Parliament. A central claim that often has been put forward in research on the EU is that European political party groups have a large influence on the voting behaviour of the MEP’s, due to growing party cohesion or intra-party voting likeliness (Attinà, 1990; Brzinski, 1995). However, research also points at national party policies as a factor behind voting in the European Parliament, which can be contributed to the fact that candidate selection is often centralized on the national level (Hix, 2002). Furthermore, more recent research has shown that although the two previous bases form the more general motivational factors, in specific legislative votes national interests, combined with country-based economic indicators, function as decent predictors for MEP’s voting behaviour (Cencig & Sabani, 2017). This research will be a continuation of existing scholarly work, adding to literature on European Parliament voting behaviour. While research has previously focussed on MEP’s voting motivation, an event like this has never before occurred within the EU. The exit of one of the biggest economies from the Union comes with international and national interests, differing across the board, which are all dealt with in the negotiations. The long line of negotiations followed after the start of the leave-procedure that entails the severance of the EU and the UK and the conditions and consequences that are attached. This procedure started in April 2017, when Prime-Minister Theresa May of the United Kingdom formally offered a notice of withdrawal to the President of the European Union. The withdrawal of the UK from the EU comes with different interests, from several different parties. First of all, the EU and the UK have come to terms about the conditions of withdrawal, and further along about the future relationship between the EU and the UK. Agreements about budget contributions on the short term, and (im)migration laws, trade relations and more on the long term are important issues that need extensive negotiating between both parties. Only when the United Kingdom has formally exited the EU, and when it can be seen as a third country, EU-27 states are allowed to
influence of member states is limited to the votes in the European Parliament, which makes it very relevant to understand what motivates the voting behaviour of the MEP’s.
This thesis is structured as follows. In section 1 there will be an outline of the organizational structure of the European Union and the role the European Parliament fulfils within the Union, together with an explanation of the rules and structure of the withdrawal process of the United Kingdom from the EU. Section 2 will provide an overview of the existing literature on voting behaviour within the European Parliament. Section 3 explains the research methods, national interest information, and the key interests of the European Parliament resolutions. In section 4 the results of the empirical research will be presented. Section 5 will offer some concluding remarks and suggestions for future research.
The European Union
The European Union is a political and economic union of 28, soon to be 27 states, that are primarily situated in Europe. With an estimated population of around 510 million citizen it is the largest union of its kind in the world. The goals of the EU are to promote peace, values and the well-being of its citizens (European Union, 2018). The predecessor of the European Union, the European Economic Community, was set up after the Second World War to foster economic cooperation. A secondary goal was to avoid new conflicts in the process, because the assumption was that countries that are economically interdependent do not engage in conflict. The European Economic Community (EEC) started with six countries, which has evolved into the current union with 28 members. What started as an economic alliance has grown into a supranational organization incorporating policy areas ranging from climate and health to justice and migration (European Union, 2018).
The foundation of the European Union is based on the rule of law. This European law is captured within several treaties that have been approved voluntarily and democratically by all EU countries. These treaties are set up in negotiations with all Member States before being send to the national parliaments for ratification on a national level. When a treaty comes into effect it sets out the objectives of the European Union and determines the rules that come accompanied with these objectives. The treaties have undergone many changes over the years, evolving together with the union and its Member States. The last amending treaty, the Lisbon Treaty, came into force in 2009. This treaty now houses the previous versions of earlier treaties, comprising of the Treaty on European Union and the Treaty on the Functioning of the European Union (European Union, 2018).
Throughout its evolution the EU has grown into a large bureaucratic and administrative union with several governing institutions. The main governing institutions responsible for decision-making within the union are: the European Parliament, the European Council, the Council, and the European Commission. The EU’s general political direction and agenda priorities are designed by the European Council. This council is a gathering of national and EU-level leaders, with the current president being Donald Tusk (European Union, 2018). Because of its configuration the European Council represents the highest level of political cooperation between member states.
The Council, also known as the Council of the European Union is comprised of government ministers from each Member Sate. Together with the European Parliament it is the main decision-making body of the EU. In this union body ministers meet to discuss, amend and adopt laws. The laws adopted in the Council have to be committed to by the Member States. Furthermore, the Council develops foreign and security policies, and concludes agreements between the EU and other countries or international organizations. Whereas the Council is a minister council, the European Commission is the main institution that is in charge of the day-to-day business of the European Union. It is the only body within the union that can formally propose legislation. The commission is composed of the College of 28 Commissioners, one from each Member State, and including the President (currently Jean-Claude Juncker) and Vice-Presidents (European Union, 2018).
The European Parliament (EP) is the final decision-making body of the union and the one most central in this research project. The European Parliament has three main roles: legislative, supervisory and budgetary. Its legislative role comprises of approving, amending or rejecting EU laws, deciding on international agreements, and enlargements of the EU. It does this in coordination with the Council of the European Union and based on European Commission proposals. The supervisory role of the European Parliament is democratic scrutiny of all EU institution, electing the Commission President and approving the Commissions as a
body, discussing monetary policy and examining citizens’ petitions. The budgetary role entails establishing the EU budget in cooperation with the Council and approving the EU’s long-term financial budget, which is called “the Multiannual Financial Framework” (European Union, 2018).
Country/Party ALDE/ADLE ECR EFDD ENF EPP GREENS/EFA GUE-NGL NI S&D TOTAL Austria 1 0 0 4 5 3 0 0 5 18 Belgium 6 4 0 1 4 2 0 0 4 21 Bulgaria 4 2 0 0 7 0 0 0 4 17 Croatia 2 1 0 0 5 1 0 0 2 11 Cyprus 0 1 0 0 1 0 2 0 2 6 Czech Republic 4 2 1 0 7 0 3 0 4 21 Denmark 3 4 0 0 1 1 1 0 3 13 Estonia 3 0 0 0 1 1 0 0 1 6 Finland 4 2 0 0 3 1 1 0 2 13 France 7 0 1 20 20 6 4 3 13 74 Germany 4 6 1 1 34 13 8 2 27 96 Greece 0 1 0 0 5 0 6 5 4 21 Hungary 0 0 0 0 12 2 0 3 4 21 Ireland 1 1 0 0 4 0 4 0 1 11 Italy 0 2 15 6 15 1 3 1 30 73 Latvia 1 1 0 0 4 1 0 0 1 8 Lithuania 3 1 1 0 3 1 0 0 2 11 Luxembourg 1 0 0 0 3 1 0 0 1 6 Malta 0 0 0 0 3 0 0 0 3 6 Netherlands 7 2 0 3 5 2 3 0 3 25 Poland 0 19 1 2 22 0 0 2 5 51 Portugal 1 0 0 0 8 0 4 0 8 21 Romania 3 1 0 1 12 0 0 0 15 32 Slovakia 0 3 0 0 6 0 0 0 4 13 Slovenia 1 0 0 0 5 1 0 0 1 8 Spain 8 0 0 0 17 4 11 0 14 54 Sweden 3 0 2 0 4 4 1 0 6 20 United Kingdom 1 21 20 1 0 6 1 3 20 73 TOTAL 68 74 42 39 216 51 52 19 189 750
Members of European Parliament
A member of the European Parliament (MEP) is an individual who is elected to function as a chosen popular representative within the European Parliament. An MEP represents their interests and that of his or her cities and regions at home. Its duties consist of listening to local and national concerns, either individual, interest groups or businesses. The daily work of an MEP combines work for their constituents in their home country, committee work related to the European Parliament, as well as taking part in their political party group and the plenary debates and votes (European Union, 2018). MEP’s meet to discuss and vote on Commission proposals for four days a month at their main headquarters in Strassbourg, France and six times a year it meets in Brussels. This is where the Parliament’s committees, political groups and other organs also predominantly meet. The dual mandate, in which an individual is both a member of the European Parliament and his or her national parliament has been prohibited since 2009.
Elections for the European Parliament are held every five years in which a number of Members of European Parliament (MEP’s) for each Member State are elected. There is no universal voting procedure as each Member State is free to choose its own election system, but it must be some form of proportional representation. Since 2014 there are 751 available seats in the Parliament. Division of these seats among the different Member States is based on the population of each state with a minimum of 6 seats per State and a maximum of 96 seats. The exact allocation of seats to each member state is based on degressive proportionality, which means that while the size of the population of each state is taken into account, smaller states are granted relatively more seats than large states.
Within the European Parliament MEP’s organize themselves into political groups. These groups are not based on nationality, but on ideological standings. Currently there are eight different European political party groups, with 731 members in total. 19 MEP’s are independents, not affiliating with any European political party group. The two largest groups in the Parliament are the European People’s Party (EPP) and the Progressive Alliance of Socialists & Democrats (S&D). These two parties have been dominant ever since the start of the Parliament, together holding between 50 and 70 percent of the seats at any time. The percentage of MEP’s that has been part of a “national delegation” has always been relatively small and has been shrinking significantly over time (Hix & Hayland, 2011). Being part of one of these political parties holds several advantages for MEP’s. The party gives access to funding, because the groups are funded by the European union, as well as enlarging speaking time within
the Parliament during debates. The number and length of the contribution in debates is partly decided by the size of the political party (Runje, 2017).
Brexit
The decision to withdraw from the EU followed after a referendum on the 23 June 21016. In this referendum 51.9% of the participating UK electorate voted to leave the EU. Prime Minister Theresa May has consequently announced that the UK will not seek permanent membership of the European Single Market or the EU customs Union after leaving the EU (Wilkinson, 2017). On the 29th of March 2017 the UK government invoked article 50 of the Treaty on the European
Union which triggered the withdrawal procedure of the UK from the European Union. The withdrawal procedure takes two years, ending on 29 March 2019 with the UK officially leaving the Union. The two years procedure will predominantly be filled with negotiations between the EU’ and UK’s negotiating parties. In these negotiations all the issues relating to the UK exiting the European Union will be determined. The first round of these negotiations ended in December 2017, producing a 15-age joint report on the result of the talks.
The European Parliament plays an important role in this negotiation process. At the start of the negotiation process the European Parliament voted on the guidelines for the negotiations between the UK and the EU, setting up which issues should be addressed first, and which issues are most important. Throughout the duration of the negotiation process the EP will be kept up to date on the progress through reports from the negotiation party and the Commission. The EP will also be asked to vote on several progress reports and guidelines for the future relation
to vote on the finalized withdrawal agreement. Only when the European Parliament approves this final withdrawal agreement it will be sent to the EU-27 member states to be ratified within the national parliaments.
Theory
To properly identify and explain the voting behaviour of the Members of the European Parliament a theoretical basis is needed. Earlier literature on voting behaviour of the MEP’s builds on research done on the United States Congress. It consists of a multitude of articles examining the dynamics of voting behaviour among elected representatives of the US population and determining the main motivational factors when it comes to picking sides. It produces several main factors, naming for instance personal preferences, constituency’s interests and national party lines (Levitt, 1996). However, examining voting behaviour within the European Parliament comes with new difficulties, because of the supranational framework in which the European Union institutions operate. This framework has been a vivid research interest, focussing on furthering integration within the European Union.
Dimensions within European Politics Classic European Integration theory
Classical European integration theories (neofunctionalism and liberal intergovernmentalism) view European politics as the process of integration, either pushing for more or less integration (Haas, 1958; Moravcsik, 1998). This results in a one-dimensional spectrum where the conflict over integration is accepted as the main theory to explain European Union politics. This leads to the idea that the positions on all issues on the EU agenda – issues like institutional framework and certain attitudes towards EU policy proposals - are based around an underlying position of the relevant actor on this one-dimensional axis (Hix, 2001). The process of integration is based on the decline of the nation state and the growing interdependence of political communities, based around these declining, but successful nation states. Political actors in several distinct national settings hand over their loyalty and political activities to a new and larger centralized institution. These institutions have the power and jurisdiction to act in a supranational role, exceeding the jurisdiction of the pre-existing nation states (Haas, 1961). According to neofunctionalism voting behaviour in the European Parliament is based around the willingness of legislators to either slow or speed up this integration process, viewing the area of conflict in European politics on a scale of more or less integration, and reducing it to this one-dimensional pro/against integration discussion.
Liberal intergovernmentalism (LI) takes a similar approach to classical European integration theory, trying to modernize more traditional integration theory by making use of
situations. It is seen as a grand theory, encompassing and linking together multiple theories and factors into one coherent approach able to explain integration over time. LI is based in ‘rational institutionalism’, drawing on aspects from different European integration studies, grounded in neofunctionalism (Moravcsik, 1998). It bases itself on “a consistent and rigorous core of microfoundational assumptions”, allowing it to analyse and explain the motivations of social actors, states, and leaders (Moravcsik & Schimmelfennig, 2009).
In its simplicity, LI is fundamentally based on two assumptions. First, states are actors. The European Union can be viewed as an anarchical state system in which the principal power lies with the states. Second, states are rational actors. Actors calculate the utility of the particular courses of possible actions, determining which is the most beneficial for their cause, maximizing gains and/or satisfaction. Under this reasoning, European politics is based on a rational struggle for power in order to maximize individual gains. Collective action is the result of an aggregate of these individual actions coming together, reaching an agreement to cooperate (Moravcsik & Schimmelfennig, 2009). This theory suggests that the main goal of legislators in the EP would be to rationally maximize their countries gains through lessening or furthering integration. While this is a different approach to the integration within the EU, it still poses integration as the main dimension of conflict in European Politics.
The classical integration theories offer clear approaches to the development and advancement of the European Union as an institution. Both variations suggest further integration as the optimal way to enhance peace and welfare, disregarding the possibility of disintegration as is seen now with Brexit. They also pose an ideological stance on which actors within the European institutions can rally around. Both theories suggest that the main dimension of European politics should be based around integration, as this is the best and only way to further peace and welfare. More recent research however has challenged this idea.
A second Dimension
New insights in voting behaviour research were made with the introduction of the NOMINATE scaling algorithm (Poole & Rosenthal, 1985). It allowed scholars to place EP legislators within a multidimensional space, based around the different dimensions of conflict within the European Parliament. This proved useful in determining if the workings of the European Parliament really focussed around the conflict of European integration, or if some other dimension proved more applicable. Various empirical studies done with the NOMINATE scaling system pointed to a different dimension as the main area of conflict within the European Parliament, suggesting that classic European integration theories do not explain the voting
records of the legislators within the EP. Research suggests that political competition within the European Parliament is centred around the classical left/right dimension (Attinà, 1990; Hix & Lord, 1997; Kreppel & Tsebelis, 1999).
This left/right dimension is created by the presence and adherence to the political party groups. As before mentioned, most of the legislators are members of one these party groups, gradually drowning out the few national delegations that have existed within the EP (Bardi, 1996). These political party groups are based around traditional European political cleavages. Since the direct elections of the European Parliament in 1979, the elections have been based on domestic party politics, domestic policy concerns and domestic political actors (van der Eijk & Franklin, 1996). As a result, the composition of the party system within the EP has been a reflection of domestic concerns, with domestic socio-economic issues leading the agenda, even in those issues are not a part of the EU agenda. The European Political party groups, are based around traditional socio-economic issues, creating a traditional left-right dimension, which is arguably the most dominant dimension in EU politics.
Multi-dimensional
However, a third set of scholars argues a mix of both dimensions creates a multidimensional spectrum on which the legislators from the EP are seated. Both the pro-/anti-integration and left/right-dimension are important in EU political competition (Hix, 1994; Hix & Lord, 1997; Hooghe & Marks, 1998). Political actors do remain true to the domestic national interests. But with the growth of integration the classic social and economic issues are transferred more and more to European institutions. This poses a new framework. This delegation of issues to the European level creates the development of a left-right dimension at the European level alongside classic national cleavages. This new dimension cannot be just copied into the European framework as a single new dimension, as this is an inherent different structure.
“One dimension that emerges is the allocation of resources and values between functional groups (the left-right dimension), and the other dimension that emerges is the allocation of resources and values to territorial groups (the national interest dimension)” (Hix, 2001, p. 665).
This new multi-dimensional approach forms four possible dichotomous points: (left/more integration, left/less integration, right/more integration, right/less integration). These dimensions are likely to co-exist and create a multi-dimensional system.
more integration left right less integration
Figure 3: Multi-dimensional system
From European Politics to Individual Voting Behaviour
European politics is based on traditional cleavages combined with a struggle for integration. By outlining the arena of European politics, the conflict on which voting behaviour is dependent becomes more apparent. The range of voting lies somewhere between the four dichotomous points that have previously been mentioned. This multi-dimensional approach is important because it clarifies the framework in which European decisions are made. To go from this broad framework to individual voting behaviour more explanation is needed on how individual voting behaviour of MEP’s is moulded within the European Parliament.
Since the birth of the European Parliament as an institution, MEP’s have mostly been part of political party groups that reflect traditional European ideologies, adding another important motivational factor into the mix. The main factor for MEPs in choosing which European political party group to affiliate with is identified to be ideological compatibility. Bressanelli (2012) found that the basis for these transnational affiliations through political party groups lies mainly in an overlapping ideology between the national party policy and that of the European political party group. This has led to the fact that country-based incentives and national party ideologies have been relatively left behind in the research on MEP voting, with it focussing mainly on the role of the European political party groups. Recent scholarly work has agreed with previous research, showing that political party groups rather than nationality, plays a big part in coalition formation within the European Parliament (Kreppel & Tsebelis, 1999). One of the factors that has been identified as key in voting behaviour is the intra-party cohesion that can be observed within the political party groups. When the cohesion within a certain party grows over time, members of this party are more likely to line up with their voting
regiment. Attinà (1990) points out that intra-party cohesion has been rising over time and confirms that voting behaviour between MEP’s with a similar ideological background has been consistent.
Recent research by Cencig and Sabani (2017) has looked at a range of factors other than European political party affiliation to explain MEP’s voting decision on matters. They expected that MEPs’ national heritage and native economic factors would challenge their voting decision, and possibly create cleavages between the affiliation with the European political party and their voting. They found that European political party affiliation is the most powerful predictor of a MEP’s decision to vote for or against. However, they did discover that the economic situation in the home country, with factors like GDP in the home country and the national employment situation, can be influential in swaying an MEP’s voting decision (Cencig & Sabani, 2017).
Research Design
In the previous section I explained scholarly work on voting behaviour within the European parliament. There has been a lot of research into the voting behaviour, but not with a vote of this magnitude, where national interests are this apparent across all the member states. This thesis aims to answer the question what explains the voting behaviour of the members of the European parliament in a situation like the Brexit, where European party group interests, national party interests and national interests come together (and collide).
To be able to do empirical research I need to create indicators with which I am able to compare the resolution that passed through the European parliament with the voting records of the MEP’s. As has been previously mentioned the Brexit withdrawal process comes with a complex array of treaties and rules that need to be reviewed and negotiated on. At the end of the process it all has to come together in the withdrawal agreement, which has to pass through the European Parliament and then is ratified by the Member States. Because it is not possible to do comprehensive research on all the wide-ranging nuances of the Brexit negotiations, I scale down the complexity of the Brexit negotiation process in this section by setting up four key interests that are in play in the Brexit negotiations. These key interests are previously distilled by Wyplosz (2016) from a wide range of scholarly works. These four interests function as the key interests which are more or less important for the different EU27 member states. They have been set up by reviewing independent scholarly work pertaining to each member state. In the following section I will explain each of the four key interests.
Key Interest Indicators Trade
First, trade is one of the four key interests represented in the negotiations between the EU and the UK, and it stands out for several reasons. The EU’s single market is based upon a free trade area which the UK leaves when it withdraws from the Union. This means that WTO rules and tariffs would apply by default, except when special circumstances are set up in the negotiations. While the UK market is a very important export market for some member states, especially some small states, it is much less important for others. A ‘hard’ Brexit without some kind of membership of the European Economic Area, or a Norway-scenario, could have strong consequences for some member states. Especially states that rely on the export of industrial goods and the import of services (Wyplosz, 2016). Other member states would not suffer so much from a trade break-up and are more benefitted by a strong integrated union without special treatment possibilities.
Foreign Direct Investment
Second, foreign direct investment (FDI) is a key interest within the negotiations. While direct trade might be not as important for a lot of the larger member states, foreign direct investment is. Luxembourg, Ireland and the Netherlands have a large FDI relation with the UK, receiving and sending considerable amounts (Wyplosz, 2016). Furthermore, some countries are large receivers of FDI from the UK, depending on subcontracting from British firms. These money flows might be an important issue for a lot of EU27 member states. This goes hand in hand with access to the City of London. As one of the largest financial centres in the world, allowing passporting rights could be an important issue. Some large countries (Italy, France) see opportunities to grow their own financial centres if the rights are revoked, while other smaller countries (Luxembourg, the Netherlands) already known for their financial services would also benefit (idem).
Labour Mobility
Third, labour mobility is a much-debated issue, that might well prove the most complex to solve. Free labour mobility constitutes one of the four main pillars of the Union, together with freedom of services, goods and capital. Allowing an exception on one of these without acknowledging the others seems intricate and will raise objections across the member states. Migration is a hot topic throughout the European Union, with some states allowing no exceptions and others being some more lenient. Some member states are net receivers of immigrants, while others are net senders (see table 2). Furthermore, a relatively large number of British citizens are housed throughout the different states within the Union, contributing to the economy. Moreover, British tourists are often seen in Southern Europe, while other member countries have extended student exchange programs with the UK (Wyplosz, 2016)+. These factors complicate the mobility interests, but also show the importance of proper negotiations and agreements within the withdrawal agreement.
European Union Budget Contributions
Fourth, contributions to the EU budget are a worry to some countries. Unsurprisingly, these are mostly the countries that are net receivers of EU funds, and some net contributors. The UK has been a net contributor even since its admission to the EU, and withdrawal would mean a reduction of the budget of the Union, leading to a cut of the funds that some countries are
attach much interest to this issue (Wyplosz, 2016).Trade, FDI and financial interests, labour mobility, and EU contributions function as the four key interests for my empirical research into the voting behaviour of the members of the European Parliament.
Hypothesis
Based on previous scholarly work and theory presented above, I pose two hypotheses to be tested:
Hypothesis I:
Members of the European Parliament vote in line with their home countries’ (rational economic) interests regarding the Brexit votes.
Hypothesis II:
Methodology
This section explains how I test my hypotheses. To conduct my research, I need three specific components: 1.) National economic interests per member state, 2.) the key interest points of the Brexit resolutions on which have been voted, and 3.) the voting records of the members of the European Parliament.
To determine what the national economic interests are per member state I have designated four issues that are key issues in the Brexit negotiation process:
• Trade
• Labour Mobility
• FDI & financial services • UK contributions to the EU
To determine what the specific interests per member state are I map out the importance of each of these key issues for all member states. I do this by making use of literature and data on the specific countries. With the Brexit process underway scholars throughout Europe have mapped out specific interests for all of the EU-27 member states. I have combined these interests to map out the countries economically beneficial position on each resolution.
The second component are the resolutions on Brexit that have been voted on in the European Parliament. There are six of these in total, of which I will analyse three. I acquired these resolutions from the website of the European Parliament. I analysed the documents according to the four key issues outlined above, in order to determine what the main issues in each resolution were. I furthermore made use of summaries and additional information on the website of the European parliament (www.europarl.eu) to properly determine how the key issues were represented in each resolution.
The third component I need to conduct my research is the voting records of the members of European Parliament. I made use of datasets from the website Votewatch.EU. I downloaded three datafiles, one for each of the votes. In these datasets each observation refers to a single MEP’s voting history with 6 variables: Name of the MEP, Member State of origin, voting decision, European political party group, loyal, or rebel. To conduct the research in the manner I wanted I need to cluster the different member states and compute the different percentages of votes that were cast for each resolution. Ultimately, I combine all three components to examine how the voting behaviour of the MEP’s is motivated.
Empirical Research
In this chapter I present my empirical research which consists of three sections. The first section will outline the Member States’ specific interests in the negotiation process. The second section will explain what the keys interests represented in each European parliament resolution are. The third and final section will compare the voting records of the MEP’s with the national interests of their home member state.
EU-27 member state interests
In the following section I assess the interests that each member state holds in the Brexit negotiations. In the theory section I have laid out the four key indicators on which I will base these interests. I attempt to cluster the different countries into groups which can be set up either positively or negatively inclined to one or more of the different indicators. I will primarily divide these clusters according to the key indicators trade, FDI, labour mobility, and EU budget contributions. Clustering these countries allows me to more easily give an overview of the interests of countries within the negotiations.
Trade
Trade is the first key indicator that is important for a large number of countries within the EU. The UK has always been always a large importing and exporting country, especially involved with other EU Member States. Table 2 shows the numbers regarding trade between the UK and EU Member States. At first glance it shows that the UK market is very important for some countries, usually small, but less important for other countries. This immediately shows a difference in importance for different countries. Furthermore, the amount of British exports to many countries, especially the smaller countries, may look negligible, but it is actually not. Individual countries might not always take on a lot of British exports, but as a whole the EU Member States are responsible for absorbing almost half of all British exports (Wyplosz, 2016). Finally, generally the UK tends to export services and import industrial foods. If the final agreement does not include new trade agreements the UK will be just another third-party country, which means World Trade Organisation rules would be implemented. These rules include heavy tariffs on traditional industries, which could have a substantial influence on some Member States (Wyplosz, 2016).
Table 2 shows that there are several groups that can be distinguished. There is only one country which exports to the UK account for more than 10% of its annual GDP and that is Luxembourg. It would seem that negotiating a future trade relation with the UK would be in the best interest for Luxembourg, as this represents a substantive part of their GDP. However, Luxembourg is a special case, which will be further expanded on in the next section. This notwithstanding there are several other Member States that have a substantial direct trade relation with the UK. Belgium, the Czech Republic, Ireland, Latvia, Malta, The Netherlands and the Slovak Republic are all Member States that have extensive exports to the UK, most of them relying on exports to the UK for more than 5% of their annual GDP.
This results in a Belgium that is somewhat torn within the negotiation process. As one of the founding members it embraces the European
Union and pursues further integration (Oliver, 2016). However, the trade balance between Belgium and the UK is skewed, with a positive trade balance of €14 billion in 2014 (Grauwe, 2016). As a result, there will be much pressure from the business export business lobby to open up the negotiations. While Latvia does not have the biggest GDP percentage trade with the UK, it views the UK as a very important promotor of liberal market values and is therefore primarily concerned about continuing the trade relations with the UK (Cooper, 2017). The Netherlands
Country Exports to the UK Exports from the UK billions (euro) % of exporter's GDP billions (euro) % of UK GDP Austria 4.36 1.7 2.2 0.1 Belgium 31.74 7.3 15.99 1.1 Bulgaria 0.59 1.7 0.48 0.0 Croatia 0.21 0.9 0.19 0.0 Cyprus 0.12 4.3 0.51 0.0 Czech Republic 7.53 4.5 2.67 0.2 Denmark 5.37 3.3 3.15 0.2 Estonia 0.33 2.2 0.3 0.0 Finland 2.78 1.9 1.85 0.1 France 32.13 2.1 24.49 1.6 Germany 89.25 3.5 41.81 2.8 Greece 1.08 1.3 1.21 0.1 Hungary 3.58 3.7 1.76 0.1 Ireland 15.28 14.1 22.97 1.5 Italy 22.46 1.6 11.59 0.8 Latvia 0.54 2.9 0.3 0.0 Lithuania 1.03 3.4 0.37 0.0 Luxembourg 0.74 10.1 0.3 0.0 Malta 0.15 9.1 0.52 0.0 Netherlands 47.48 7.6 23.98 1.6 Poland 12.08 3.3 4.98 0.3 Portugal 3.35 2.7 1.72 0.1 Romania 2.38 1.8 1.36 0.1 Slovak Republic 3.76 5.2 0.61 0.0 Slovenia 0.54 1.5 0.28 0.0 Spain 18.72 2.4 12.17 0.8 Sweden 9.07 3.2 6.08 0.4 Total 316.65 - 183.84 -
annual GDP. A negative effect of new trade barriers is that much of Britain’s trade with the EU comes through the Netherlands (for instance, from and to Germany). This means that the Netherlands would benefit if the UK’s access to the Single Market remains intact and would suggest that the Netherlands will be interested in offering some leniency when it comes to negotiations on the Single Market (Oliver, 2016).
Furthermore, the Czech Republic has close ties to the UK, sharing similar opinions on many policy areas such as trade policy and the EU single market. The trade relation between the Czech Republic and the UK has been consistently growing, with the UK being the fourth most important export partner in 2015 (Oliver, 2016). Malta and Slovakia need to deal with similar issues, relying heavily on the trade relation with the UK. Malta is highly dependent on its trade relation with the UK and could experience a serious loss of GDP depending on which kind of Brexit takes place. This all means that these EU Member States are likely to be more inclined to react positively to any swiftly arranged trade agreement between the UK and the EU.
Ireland is a special case in the Brexit situation. It is the only country within the EU that shares a land-border with the UK and arguably has the most at stake in this Brexit process. It has historical and cultural links dating back centuries and has an intensive trade relation with the UK. The border between Ireland and Northern Ireland has been a special subject within the negotiations till this day (Barret & Morgenroth, 2016). An ideal future relation for Ireland would provide a framework that preserves the mutually beneficial relationship between the two countries. Regarding trade this would mean a limited disruption to the €1 billion weekly that flows between the two countries in trade (Oliver, 2016).
Besides the countries that will feel direct effects of the UK leaving the Union, indirect trade effects will be likely to affect a number of countries. These indirect effects are harder to predict and are formed by manufacturing processes that cross throughout the European Union. For instance, Hungary exports 30% of its total exports towards Germany. Germany has a large trade relation with the UK relative to Hungary. Around a third of German exports to UK consist of vehicles. A quarter of the exports from Hungary to Germany consists of raw materials for the vehicle manufacturing industry. A changing trade relation between the UK and Germany is highly likely to affect Hungary’s trade flow, albeit not directly (Halpern, 2016). More countries are likely to be affected in similar ways. However, case studies on this subject are to this day lacking, which makes it hard to include this kind of indirect trade relations into this research project.
Preserving trade regulation For Neutral Against
Belgium Austria Croatia Cyprus Bulgaria Finland Czech Republic Denmark France Ireland Estonia Germany Latvia Hungary Greece Malta Lithuania Italy
Poland Portugal Luxembourg The Netherlands Romania Slovenia
Slovakia
Spain
Sweden
Table 3: Trade interests
FDI & Financial services
Foreign direct investment (FDI) might be less important than trade for some of the smaller countries, which receive and send negligible amounts of FDI, except for Malta and Cyprus. However, there are countries within the EU for which these flows of capital are very important. Luxembourg and the Netherlands are the most notable countries which stand out in Table 4 for their high FDI percentage. These large flows partly have to do with tax optimisation. But there are more countries for which FDI plays a big role. Some of the larger countries like Germany and Spain receive more FDI than they send, suggesting that British firms outsource parts of their production processes to these countries. Keeping these flows going might be important for the national economies. Furthermore, Ireland is, as earlier explained, closely tied to the UK and heavily dependent on FDI and its economy would be disrupted by any large tariff barriers in a future relationship (Oliver, 2016).
As witnessed when looking at the trade figures in Table 2, the Netherlands is one of the EU countries that could suffer negative setbacks from any kind of “hard” Brexit. This does not change looking at the figures on FDI. Almost one third of Dutch GDP accounts for the FDI accumulated in the UK, more than Germany and France combined. Vice versa, 6.5% of UK GDP is accumulated in the Netherlands, again more than France and Germany combined. While these numbers can be partly attributed to tax planning schemes of international companies, the UK and the Netherlands have a strong mutual interest in setting trade barriers as low as possible when it comes to foreign direct investments in each other’s economies (Beetsma, et al., 2016).
Country
Accumulated investment in
the UK Accumulated investment by the UK €
billion % of investor's GDP € billion % of UK GDP Austria 2.9 0.87 1.2 0.05 Belgium 31.8 7.93 13.6 0.60 Bulgaria 0.0 0.02 0.2 0.01 Croatia -- -- 0.3 0.01 Cyprus 4.6 26.50 0.7 0.03 Czech Republic 0.0 0.01 2.1 0.09 Denmark 8.4 3.21 8.7 0.39 Estonia -- -- 0.2 0.01 Finland 1.9 0.90 1.3 0.06 France 94.3 4.41 47.4 2.10 Germany 62.1 2.13 29.5 1.30 Greece 0.2 0.14 1.9 0.09 Hungary 0.0 -0.01 1.1 0.05 Ireland 17.0 8.82 41.9 1.85 Italy 5.5 0.34 12.3 0.55 Latvia -- -- 0.1 0.01 Lithuania -- -- 0.1 0.00 Luxembourg 97.8 200.00 134.0 5.93 Malta 0.8 9.70 -- -- Netherlands 218.0 32.90 147.0 6.52 Poland 0.1 0.03 6.2 0.27 Portugal 0.6 0.34 3.1 0.14 Romania 0.0 0.01 1.1 0.05 Slovak Republic 0.0 0.01 0.3 0.01 Slovenia 0.0 0.03 -- -- Spain 56.7 5.44 20.2 0.89 Sweden 12.0 2.77 22.4 0.99 Total 614.69 496.78 22.0
Table 4: FDI (Wyplosz, 2016)
Besides the Netherlands, Spain has great interests in setting up as small barriers for FDI (and trade) as possible after Brexit. The UK has been the largest receiver of FDI from Spain for some years. Spain has grown to be the largest investor into the UK within the EU and is only surpassed by the US worldwide. Its outflow of FDI has largely flown through Spanish banks Santander and Sabadell and is mostly aimed at finance, telecom and electricity (Garicano, 2016). Spain is vulnerable in this effect, because of its large investments and needs a workable
future relation with the UK that minimizes FDI barriers. This stance on FDI will be shared by Estonia, Cyprus and Malta, the latter two both highly dependent on the UK for investment. Cyprus will opt for an as-soft-as-possible Brexit. It is dependent on the relationship with the UK, economically as well as culturally. Cyprus and Malta are both part of the Commonwealth and especially Cyprus houses British military bases that cover more than one percent of its land (Cooper, 2017).
Furthermore, financial services play a large role in any future agreement between the UK and the EU. The City of London has established itself as one of the financial centres of the world, and the UK is very much inclined to maintain this position. Passporting rights are key to maintaining this position. Passporting allows financial institutions registered in one state within the European Economic Area (EEA) to do business in any other EEA state without needing further authorization. If the UK loses these rights the City of London may stand to lose ground as one of the main financial hubs. This is where some Member States see possibilities. France has already taken steps to attract those financial firms that might want to relocate after the Brexit, simplifying and speeding-up procedures and offering English-speaking contacts to UK- based applicants (Boone & Kunanathan, 2016).
While a similar situation as that of the Netherlands regarding FDI can be described for Luxembourg, which is even more dependent on UK FDI than the Netherlands, Luxembourg can choose to pursue a different approach. Luxembourg is the largest hub within the Eurozone for international wealth management, and therefore can post-Brexit aim to take over a part of the financial services previously hosted in the City of London. This means that while at first glance Luxembourg might be heavily dependent on minimal trade barriers, this might not be in the best interest for Luxembourg after all (Cooper, 2017). Italy might also take part in this kind of reasoning. Italy has had a longstanding relationship with the UK, but opportunities arise if new patterns of FDI take form. If investment from outside the EU, either manufacturing or financial trading, relocates to eurozone countries instead of the UK, Italy is a possibility to take a share of this. Milan, whose Borsa Italiana is owned by the London Stock Exchange group, might be a good candidate to attract these new investments (Micossi & Perissich, 2016).
Preserving FDI & financial services For Neutral Against
Belgium Croatia Austria Cyprus Denmark Bulgaria Estonia Italy Czech Republic Ireland Latvia Finland Malta Lithuania France The
Netherlands Sweden Germany
Spain Greece Sweden Hungary Luxembourg Poland Portugal Romania Slovakia Slovenia
Table 5: FDI interests
Labour Mobility
Labour mobility and the ban on discrimination against foreign nationals from within the EU is a big issue within this negotiation process. It constitutes one of the four freedoms that are viewed as the fundamental pillars of the EU and it will be difficult to come to terms on this issue. There are a number of countries that view this matter as non-negotiable, stating it as a matter of principle. However, there is no doubt that throughout the last decades a lot of migration and labour mobility has taken place within the EU, spreading citizens from all countries all over the EU. A solution has to be found that is agreeable for both parties in the negotiations and that manages the rights of migrating citizens. The issue is complicated either way. Some Member States are net receivers of EU migrant, while other countries are net issuers. Besides this, migrants come from all over the world, not just from within the EU, and this is where the Schengen agreement comes into play. While the negotiations might seem only to concern only intra-EU migration, the Schengen agreement complicates this matter. Once migrants (from outside de EU) are registered in any one EU country, they are free to migrate to any other EU country under the Schengen regulation, except for the UK and Ireland who have an opt-out close. National interests throughout the EU will be based along these distinctions.
There are a number of countries who are dealing with a large number of their citizens living in the UK. Viewing table 6, Poland is the most conspicuous one. It views the freedom of
movement of workers as one of the great advantages of the EU and will be reluctantly on giving up the rights of their citizens living abroad. Poland has the largest population of EU nationals
Country EU27 citizens in the UK UK citizens abroad Number % of population of emigration
country Number % of UK population Austria 21,698 0.3 11,013 0.02 Belgium 29,142 0.3 27,335 0.04 Bulgaria 51,875 0.7 5,329 0.01 Croatia 9,029 0.2 670 0.00 Cyprus 84,815 9.7 40,547 0.06 Czech Republic 41,605 0.4 4,795 0.01 Denmark 24,972 0.4 18,556 0.03 Estonia 9,361 0.7 487 0.00 Finland 14,325 0.3 6,898 0.01 France 149,872 0.2 185,344 0.29 Germany 322,22 0.4 103,352 0.16 Greece 39,7 0.4 17,679 0.03 Hungary 56,166 0.6 6,98 0.01 Ireland 503,288 10.7 254,761 0.39 Italy 151,79 0.3 64,986 0.10 Latvia 66,046 3.4 1,148 0.00 Lithuania 116,861 4.1 3,301 0.01 Luxembourg 2,092 0.4 6,559 0.01 Malta 31,758 7.6 12,046 0.02 Netherlands 68,489 0.4 49,549 0.08 Poland 703,05 1.8 34,545 0.05 Portugal 98,967 1 17,789 0.03 Romania 89,402 0.5 3,124 0.00 Slovak Republic 67,781 1.2 4,89 0.01 Slovenia 2,298 0.1 578 0.00 Spain 91,179 0.2 308,821 0.48 Sweden 35,055 0.4 24,95 0.04 Total 2,882,836 1,216,032 1.89
of this group will be allowed to live in the UK after Brexit, if they have lived in the UK for more than five years. However, what will happen to the rest is still uncertain. Poland has great interests in preserving their rights and incorporating protection of their citizens living in the UK in any future agreement (Rosati, 2016). Latvia and Lithuania find themselves in a similar position as Poland, with a relatively large percentage of their citizens living and working in the UK (Cooper, 2017; Oliver, 2016). These are the countries that are not primarily focussed on continuing the free movement of people in a future agreement but do have large interests in preserving the rights of citizens that have already migrated.
Furthermore, there are countries whose primary concern regarding labour mobility lies with the freedom of movement do being agreed upon in a future agreement between the UK and the EU. Cyprus, Malta, Romania and Slovakia value the freedom of movement and also have a relative high percent of its population living in the UK, profiting from the single market and mobility of people (Oliver, 2016). Being part of the Commonwealth Cyprus and Malta have a special relationship with the UK, depending on the free movement of people for the strengthening of existing ties. This will also develop the financial and commercial services they already exchange (Cooper, 2017). Romania and Slovakia are not part of the Commonwealth but maintain a relatively large exchange of citizens with the UK. The UK is Slovakia’s non-neighbour with the most Slovaks and it would like to maintain this relation. Moreover, because the UK is a highly wanted scholarly destination for Slovak students, which fosters exchange of knowledge. Romania shares these interests experiencing the economic effects of the EU and wishing a more integrated Union.
Labour mobility
For Neutral Against
Bulgaria Austria Belgium Cyprus Croatia Finland Czech Republic Denmark France Ireland Estonia Germany Latvia Greece Hungary Lithuania Luxembourg Italy Malta Portugal Spain Netherlands Slovenia
Poland
Romania
Slovakia
Sweden
All beforementioned countries have interests in preserving citizens’ rights and/or labour mobility as close as possible to what is within the EU. However, this also depends on the UK’s stance within this negotiation. Labour mobility already was an issue prior to the Brexit referendum, when the British government requested some exceptions on the right to settle in the UK and the treatment of EU citizens regarding welfare services, which were rejected by the EU. After the referendum Prime Minister May considered that popular opposition this freedom has been one of the deciding factors within the outcome, which makes it a key interest in the negotiations for the UK side. This is partly due to the fact that the UK has been a net receiver of migrants, with an estimated 3.6 million EU citizens living in the UK (Rosati, 2016).
European Union budget contributions
All the Member States of the European Union are somehow linked to the EU budget. Some of the states are net contributors and some countries are net receivers. Not surprisingly, the countries that worry the most about contributions from the UK are in general are net receivers of these contributions. Brexit could have implications for the funds they receive from the EU. The UK has been a net contributor to the EU budget ever since its admission to the Union, which will mean that a withdrawal will reduce the net amount that a number of countries
receive. The large countries, most of them being net contributors to the EU budget as well, have less at stake here.
In 2016 the UK was responsible for 13.45% of the EU budget through its contributions (Statista, 2017). Looking at net contributions (payments minus amounts received) Germany is the largest net contributor, followed by the UK. In 2015 Germany spent approximately 13.5 billion euros, while the UK contributed 10.9 billion euros. Over the past 15 years all Member States in eastern Europe and nearly all Member States in southern Europe have, on average, been net beneficiaries of the EU (CBS, 2016). The UK’s withdrawal from the EU will have serious consequences for the monetary flows within the EU, as a gap in the budget will emerge that will need to be filled by other Member States.
Bulgaria, the Czech Republic, Croatia, Greece, Hungary, Poland, Romania, Spain and Slovakia are all countries that are large net beneficiaries of the EU budget. A large percentage of these contributions come in the form of agriculture subsidies and/or regional policy funds. These countries rely heavily on EU funding for maintaining and boosting their economy. Especially, Poland, who has been the largest receiver of EU structural funds can be stuck with a large reduction of their budget in a post-Brexit EU. Countries like France, Germany, the Netherlands and Sweden are net contributors who have less to worry about when it comes to these budget issues.
Concerns on Budget contributions Yes Neutral No
Bulgaria Austria Belgium Croatia Cyprus France Cyprus Denmark Germany Czech
Republic Estonia Italy
Greece Finland Netherlands Hungary Ireland Italy
Latvia Lithuania Sweden Poland Luxembourg Romania Malta Slovakia Portugal
Slovenia
Spain
Conclusion
In the previous section I have tried to lay out the national interests of the Member States within the negotiations on Brexit. It needs to be stated that national interests as such cannot be observed but can only be inferred. The
interests I have laid out in the previous section can only be labeled as inferred national interests. The issues on which the Brexit negotiations are based are intricate matters with no clear solutions. Scholarly literature does not unanimously agree what the most beneficiary positions on these issues are. Therefore, it remains difficult to definitely place the Member States on a side of each issue. However, I have based my findings on extensive literature on the Brexit issues and expert literature rooted in the specific Member States. In table 9 the inferred national interests have been set up to give a quick overview.
Country
motivation to be flexible on: Concerns about budget contributions Trade FDI and Financial services Mobility Labour
Austria - No - -
Belgium Yes Yes No No
Bulgaria - No Yes Yes
Croatia No - - Yes
Cyprus Yes Yes Yes -
Czech
Republic Yes No Yes Yes
Denmark - - - -
Estonia - Yes - -
Finland No No No -
France No No No No
Germany No No No No
Greece No No Yes Yes
Hungary - No No Yes
Ireland Yes Yes Yes -
Italy No - No No
Latvia Yes - Yes Yes
Lithuania - - Yes -
Luxembourg No No - -
Malta Yes Yes Yes -
Netherlands Yes Yes Yes No
Poland Yes No Yes Yes
Portugal - No No -
Romania - No Yes Yes
Slovakia Yes No Yes Yes
Slovenia No No - -
Spain Yes Yes No -
Sweden Yes - Yes No
European Parliament Resolutions
To properly assess the voting behaviour of the members of the European Parliament I need to distinguish how the key factors that I set up come back in the resolutions that are voted on. There have been 6 resolutions in total have been voted on in the EU parliament. Of these six resolutions four passed, and two were rejected. For all six resolutions I give a broad overview of the main factors that are central in each resolution. Three resolutions I examine more thorough: 1.) The first resolution that lays out the guidelines for the overall negotiations1 between the EU and the UK. I examine this resolution further because it is the starting point of the negotiations and sets a benchmark for the whole process of the negotiations. 2.) The first resolution on the state of play of the negotiations between the UK and the EU. I look at this resolution because it discusses the progress that has been made in the first round of the negotiations. It gives an overview if the negotiations are going in the right direction and allows the members of the European Parliament to speak out if they agree or disagree. 3.) the resolution on the framework for the future relation between the UK and the EU. I examine this resolution more closely because it covers a next step in the negotiations. It focusses mostly on the future relation between the EU and the UK, which brings in subjects that are integral to this research project. In the next section I will outline each resolution broadly, examining the thee mentioned above more closely. The four key factors (trade, labour mobility, FDI & financial services, and EU contributions) will function as a guideline in examining the resolutions.
Resolution 1: Guidelines for negotiation (O8-TA(2017)0102)
This resolution is the first resolution pertaining to Brexit that the European Parliament has voted on and was passed. It followed on April 5th of 2017 after the United Kingdom notified the EU
that it intends to withdraw from the European Union. It is set up to outline the most important issues that need to be dealt with in the negotiations between the UK and the EU, and in what order this process should take place. In relation to the four key indicators, this resolution leaves no room for any preferential treatment on trade, labour mobility, and FDI. It emphasizes the need for contribution obligations.
Trade
The first thing the resolution stresses is that the negotiating of any future trade agreements with third countries is in contradiction with the Principle of Sincere Cooperation laid down in the Treaty on European Union, and therefore not allowed. When the negotiations are over, and the withdrawal procedure is complete, and the UK is a third country itself, only then it is permitted to engage in trade agreements with other third countries. Furthermore, the resolution establishes that the future trade agreement between the UK and the EU should be comprehensive,
well-balanced, and should serve the best interests of both parties, while on the other hand respecting the fundamental principles of the Union, including the integrity of the internal market. This is followed by the statement that the resolution opposes any future agreement between the UK and the EU that includes sectoral provisions, providing preferential access in respect to financial services, the internal market and/or the customs union. This resolution does not leave a lot of room for trade. It highly emphasizes that the UK cannot engage in new trade agreements while in the process of leaving the European Union, and also foresees no preferential treatment for the UK in the future relation between the UK and the EU.
FDI & Financial services
FDI and financial services are not extensively featured within this resolution. The same applies for this aspect, as it did for the previous ones, in the sense that no preferential treatment will be given to the UK. It does mention the possibility of a future association agreement, “involving reciprocal rights and obligations, common actions and special procedures”.
Labour mobility
The resolution does not specify anything on the future framework of labour mobility between the UK and the EU. It however does state that the legal status of EU-27 citizens living or having lived in the United Kingdom, and the status of UK citizens living or having lived in other members, should be addressed. It asks for the fair treatment of EU-27 citizens falling within either of above-mentioned categories but states no specifics. It furthermore emphasizes that, in accordance with the conditions on future trade agreements, no preferential treatment regarding the free flow of labour mobility will be permitted. Combining these statements, the resolution is not outspoken about the future of labour mobility, except to say that no preferential treatment for the UK will be accepted.
European Union budget contributions
The resolution states that as long as the negotiations are ongoing the UK enjoys it privileges as an EU member, which also means it has to remain bound by its duties and commitments. It furthermore reaffirms that the UK must honour all its legal, financial and budgetary obligations, and that a settlement must be reached on the financial obligations between the UK and the EU. This resolution does not specify strict conditions for the future of UK contributions to the EU but does emphasize the need for the UK to remain bound to previously set commitments.
Resolution 2: State of Play (T8-0361/2017)
moment of possible interference or adjusting of course. This resolution is the second Brexit resolution that was voted on in the European Parliament. The main conclusion of this resolution was that not sufficient progress on several aspects had been made in the first stage of negotiations to start the negotiations on the framework for the future relation between the EU and the UK. The three main issues that progress was insufficient on were citizens’ rights, Ireland and Northern Ireland, and the settlement of the UK financial obligations. This resolution reiterates the previous position on trade and FDI. It does plea for a more extensive view and ruling on labour mobility.
Trade
This resolution does not deal with any specific issues on trade. It only re-emphasizes that being part of the integrated market is not possible without full application of the four freedoms of the EU (free movement of citizens, capital, services and goods), and that these freedoms must be under the jurisdiction of the Court of Justice of the European Union (CJEU).
FDI & Financial services
There are no specific issues of FDI or financial services addressed in this resolution. As above-mentioned the resolution only emphasizes there can be no free flow of capital without applicating all four free movement aspects.
Labour Mobility
This resolution is partly focussed on labour mobility and immigration. The resolution states that citizens’ rights are not well enough encased in the negotiations and should be better laid out in the future agreement. The withdrawal agreement must ensure that citizens hold the full set of rights they currently enjoy, and it must ensure reciprocity equity, symmetry and non-discrimination. Especially, EU national residents and children born after the finalisation of the UK withdrawal agreement should be classified as family members and not as independent right holders. This would mean that family members are eligible for migration after the withdrawal of the UK from the EU is finalized, which could be important for large groups of member nationals living within the UK.
European Union budget contributions
In the resolution it is clearly stated that the UK (and the EU) should respect the whole of financial obligations that both parties have engaged in from the whole period of the UK’s membership of the EU. This includes any contributions to the EU budget that have previously in time been finalized. This resolution furthermore includes the suggestion that these kinds of
