Brexit: Definition, Current Position, Debates and Obstacles

This article provides a detailed overview of Brexit, including its definition, current position, debates, and obstacles. It also discusses the impact of Brexit on various sectors such as the job market and the automotive sector. The article provides information on the transition period, the Irish border/backstop, and the obstacles faced by the UK regarding Brexit. It also discusses the different options available to the UK, including soft Brexit, hard Brexit, and no Brexit.

Running head: CONTEMPORARY BUSINESS ENVIRONMENT
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Definition of Brexit
The word Brexit is a combination of two words namely ‘Britain’ and ‘exit’. In the year of
2012, a referendum on the relation between the countries UK and Europe was rejected by the
Prime Minister, David Cameron. Prime Minister Cameron, declared officially that the
government will be holding an in or out referendum on the membership of EU before 2017 ends.
This was announced on 23th January 2013.
With the percentage given below, the British were favored to withdraw from the EU on
23th June 2016.
‘BBC 2016’
On June 2016, when Prime Minister Cameron resigned, he informed to activate Article50 by the
next Prime Minister and to start negotiating with the EU on 2016 October. The present Prime
minister stated Theresa May, declared that Article 50 will be implied during the first quarter of
29th March 2017. Article 50 states: “Any member state may decide to withdraw from the union
in accordance with its own constitutional requirements.” It was notified that both the parties
involved in the negotiation were compelled to follow the Article 50. It also states: "from the
date of entry into force of the withdrawal agreement or, failing that, two years after” until it
was decided to extent the two years’ time by the UK and EU council. The draft Bexit
Withdrawal Agreement consists of 599 pages it provides information about how UK exists the
European Union. It also contains information regarding
 If UK breaks the partnership, they have to pay about £39bn to the EU.
 It states information about the happenings of UK and EU citizens living within and
outskirt of UK.
 It answers questions pertaining to the return of physical border between the Republic of
Ireland and Northern Ireland.

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Brexit situation regarding the current position, debates and obstacles
During the arrival of Brexit day on 29th March, Mrs. Theresa May officially stated
to drive the British out without any deal known as no-deal Brexit as the parliament
cannot agree collective loss of nerve at Westminster. It is warned by Mrs. May in a report
that no deal could leave Britain to miss 9.3 % of GDP which could have the time of 15
years by living in EU.

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Under the international law the withdrawal negotiation is related the treaty which will bind the
EU and UK. The treat of EU will stop applying on the UK till the agreement is enforced ‘exit
day’, at that point of time the relationship with the EU will be executed according to the
agreement.
The transition period
The implementation period will be on 29 Mach 2019 until 31 December 2020. During
this period the UK will be under the EU, till that time they will be deprived of amending or
making regulations and rules of the EU. It implies that they will lose membership.
The withdrawal statement says that only for one or two years the transition can be extended. In
order imply that both the negotiating parties must come to common agreement until 1st July
2020. The advantage of this transition is that it gives more time to the business as well as the
government for preparing new regime thereby making path for EU as smooth as possible. On
critical issues such as security, the UK may access to EU databases as per the transiton.

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‘Gareth Cross October 2018’
 Irish border / backstop
There has also been a bad relation with the Northern Ireland and Ireland, but things calmed
down, when they became partners with the EU. Ireland could stay in UK, and the people can be
acquiring citizenship of both UK and Ireland. Currently, there are two jurisdictions for trading of
services and goods on Ireland, however there are some restrictions.

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After the Brexit, all that could be changed was different regulatory regimes and customers in two
parts of Ireland, this would imply that the goods and products will be verifies and checked at the
‘Hard Borders’ or else at the Militarized borders which are redeployed. Originally the EU
promised a backstop which implies that the people of Northern Ireland living in the EU customs
unions, huge portion of the single market, the taxation policies of EU and other regulations and
rules ‘ John Campbell on December 2018.
There was a problem with this that is if the backstop was implemented to the Northern
Ireland, the rules, regulations and customs would be drawn down upon the middle of the Irish
Sea. The products and goods that were coming from other places other than UK into the
Northern Ireland needs to be checked and verified as to the standards mentioned by the EU. Any
other status from the rest of the UK elsewhere in the United Kingdom will be considered to be
damage to the entire union wholly. The proposal of EU was continuously rejected by the Prime
Minister Theresa May stating that such proposal might threat the constitutional integrity of UK.
A backstop was suggested by the Prime Minister May that would enable to see UK aligning with
the customers of EU union for a limited period of time after the year 2020. The only thing

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contained in the proposal given by her is the market regulatory issues which is significantly more
important than maintaining the soft border terms and customs. It was stated that there will no
withdrawal agreement as well a transition period, if the backstop deal fails to go through. This
will be possibly hard chaos, Brexit.
Obstacles faced by UK regarding Brexit
Different options pertaining to the questions of the Brexit were brought to UK. Some of them
include:
 Soft Brexit
The soft Brexit implies firstly that there would be similar membership between the UK and
European Economic Area ( EEA) similar to Norway; it states that it will be able to create deals
while having access to the single market excluding the rest of EU.
All the members’ f the single market agrees with the reduction and eliminating the blockades on
the “four fundamental freedoms” ‘ALICE FOSTER 2016’:
Movement of goods freely: It ensures that the products and goods are conformed and verified to
high health, and conform to the save requirements of the environments.
Services: It enables the companies of EU to provide service in countries other than EU.
Capital: It removes all type of restrictions on the movement of capital and payments among the
members of EU.
Free movement of the people: It gives rights and obligations to the companies of the EU to stay
and work in any states of EU, inclusive UK.
This clearly states that the companies are freed from the burden of tax and tariffs, the restrictions
regarding trade and enables all the member countries to freely work and move all across the EU.
The UK living under the EU where also needed. Example, there would be continuous and same
making of the financial contributions regarding the EU budget by the treasury. Other rules
include the standards regarding environment and taxation.
 Hard Brexit
It is exactly the opposite of soft Brexit. It is also known as ‘no deal Brexit’. It implies that both
the negotiating parties that are the EU and UK failed to reach to a common withdrawal
agreement. It means that there will be no 21 month period of transition. It simply states that UK
will be taken out of the single market rules and customs and the market obligation will be ended
can consideration with the “four fundamental freedoms” which was mentioned before. It further
states that immigrants systems which are unspecified have been replaced with the EU citizens

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being able to move freely in order to bring the migrants below 100,000. Moreover, it will not be
under the rules of EU and European Court of Justice (ECJ) rulings. No Brexit
The no deal Brexit implies that the negotiating countries UK and EU failed to reach a common
ground of agreement. In that case, the 21- month transition period will not exist. If there would
be “hard Brexit” there will be no more clarity and increase chaos in the future and there will be
further consequences.
Trade: In regard to trade, the UK might revert to the WTO. It simply means that the UK will not
be bound to follow EU rules; therefore they need to take up the external tariffs of EU.
People: It states the people of UK can set its free own controls by the nationals of EU on the
immigration.
Laws: Britain need not follow the rules of the European court of Justice, but they will be bound
to follow the European Court of Human Rights. ‘Serina Sandhu 2019’
Till date effects of Brexit and its near future
The Brexit being a transformative decision, it comes with lot of uncertainty for its operating
business, the employees as well as the job seekers. Furthermore, Brexit impacts on the
investments. Some of the sectors hit by Brexit
 Job Market
Due to the upcoming Brexit, the job market faces crisis. By the year 2025, it is assumed that
there will be 2% reduction in EU-UK trades inter-regionally, it is predicted that Greater
Manchester job shortfall will be 0.6% which means 5800 less jobs considering with the no Brexit
effect. The corresponding figures that is 1.7% for the Inner London implies that there will be
66,500 job shortfalls ‘Professor Bernard Fingleton May 2018’
 Automotive Sector
Due to the Brexit the car manufacturing industry is at risk as it can destroyed the competiveness
of the UK industry. The manufacturing industry is completely dependent on the supply chains.
There are records which higher the production of automobile industry which have benefited the
supply chain. The future of the automobile industry is dependent and is uncertain; there are
challenges on the sustainability of the supply chain.
Due to the crisis, BMW is facing serious issues in UK; the car manufacturer has employed
around 850,000 employees in UK, the plant in Oxford have been producing popular Mini range
‘CostasPitas 2018’. The company has informed Sky news that it has been planning for "all
scenarios" when UK exists EU- including "a hard Brexit". It has officially declared that it will

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move the annual maintenance shutdown for the British Leaves of the Mini plant in the month of
April. In case where there will not be any Bretxit deal. The cost will be millions if there is a
shutdown. And will affect the employee in BMW. The company tries to build 220,000 cars in the
south. English Oxford plant accounts for 13% of Britain’s car production among 1.67 million
units. ‘Costas Pitas 2018’.
Impact
https://www.oliverwyman.com/content/dam/oliver-wyman/v2/publications/2018/march/Oliver-
Wyman_Clifford-Chance-The-Red-Tape-Cost-of-Brexit.pd
Conclusions and recommendations.
https://en.wikipedia.org/wiki/Brexit
1. https://www.theguardian.com/politics/2016/jun/25/article-50-brexit-debate-britain-eu
2. John Campbell 2018 https://www.bbc.co.uk/news/uk-northern-ireland-politics-44615404
3. https://www.dw.com/en/eu-customs-union-single-market-brexit-what-you-need-to-
know/a-42462951single market
4. ALICE FOSTER2016https://www.express.co.uk/news/politics/684968/EU-four-
freedoms-what-freedom-of-movement-goods-capital-services-workers-European-Union
5. https://www.theguardian.com/politics/2018/nov/14/brexit-deal-key-points-from-the-draft-
withdrawal-agreement
6. https://www.express.co.uk/news/uk/1004777/Brexit-news-UK-EU-no-deal-planning-
five-industries-latest
7. Feg Insight December 2018 Available from https://www.feg.com/hubfs/research-
insights/feg-insight/2018-12%20Brexit/FEG%20Insight%20-%20Brexit%20-%20A
%20Certainty%20of%20Uncertainty.pdf
8. Gareth Cross October 2018 Available
fromhttps://www.belfasttelegraph.co.uk/news/northern-ireland/brexit-secretary-says-
backstop-must-go-if-pm-wants-to-extend-transition-period-37442287.html
9. Serina Sandhu February 2019 Available fromhttps://inews.co.uk/news/brexit/no-deal-
brexit-what-meaning-uk-leave-uk-consequences/
10. Costas Pitas Septembre 2018Availablefromhttps://uk.reuters.com/article/uk-britain-eu-
mini/bmw-moves-uk-mini-plant-shutdown-to-just-after-brexit-in-case-of-no-deal-
idUKKCN1LY1WM