Posted by on March 11, 2019 10:10 pm
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Update (7 pm ET): Jean-Claude Juncker has published a letter recommending that the clarifications and legal guarantees to the Withdrawal Agreement & backstop be embraced by the EU27 during the upcoming summit.

Here is the full five-page “joint interpretive instrument” that May’s cabinet says is tantamount to a “legally binding assurance” that the UK could unilaterally exit the backstop, should it come to that.

And here’s the core of the agreement, the “unilateral declaration”, stating, in effect, that the EU has no intention of making the backstop a permanent arrangement.

The big question now: Does this constitute a legally binding arrangement?

At least one critic said the statement simply restates the text from the withdrawal agreement, and is effectively a written version of the EU’s repeated verbal insistence that it doesn’t intend to hold the UK hostage in the backstop.

In short: It appears, as many suspected, that May’s last-ditch effort won’t be enough to win over the ERG and DUP. And Labour has already declared its opposition to the deal, even with these adjustments. Which means May’s deal is likely headed for another stunning defeat on Tuesday.

But instead of revealing whether the statement is enough to win its support, the DUP said it would carefully scrutinize the paper line-by-line and measure it against the Brady amendment and May’s commitments from late January, when she said she would secure meaningful, legally binding changes to the backstop.

Ultimately, whether the ERG and DUP support the agreement could depend on their feelings about an arbitration committee that would decide whether the UK could leave the backstop unilaterally.

Though thee biggest deciding factor will likely be AG Geoffrey Cox’s updated legal advice. If it affirms May’s cabinet’s claims that the deal is legally binding, the vote could very likely succeed.

Though much uncertainty remains, and some Torys have already said they intend to vote against the deal, the pound has largely retained its gains.

GBP

* * *

Has Theresa May done the impossible?

Though negotiations are still taking place between May and European Commission President Jean Claude Juncker in Strasbourg, UK Cabinet Office Minister David Lidington told the Commons on Monday night that May had secured “legally binding” changes to the withdrawal agreement. If accurate, this would be a major concession on the part of the EU, which had repeatedly insisted that the deal, which was struck last year, was closed and would not be reopened.

The purported concession comes ahead of a crucial Tuesday night meaningful vote on May’s deal that many see as possibly the last chance for her to pass the deal. If it fails, it could give frustrated MPs and cabinet ministers to oust her from office.

The pound rallied on the news, though the move swiftly started to fade after Lidington mentioned that negotiations were ongoing, while the euro weakened to its lowest level since May 2017 against sterling.

Pound

Lidington went on to defend May’s original deal, and warned lawmakers that they now faced a stark choice: Vote for May’s deal on Tuesday, or plunge the country into a political crisis.

Though it’s not the first time we’ve heard that.

Immediately after Lidington, Labour Shadow Brexit Secretary Keir Starmer tore apart what may is reportedly offering.

She said it will involve changing the Withdrawal Agreement,” Starmer points out, adding that May then voted for the backstop to be replaced. “It sounds as though none of that has happened.”

“To stand here today and say this is a significant change when she’s repeating what she said on January 14 is not going to take us very far.”

And here’s the key question:

“Is a single word of the Withdrawal Agreement different?” Starmer asks.

And Bloomberg’s Dublin Bureau chief Dara Doyle urged traders to be careful before deciding whether this is a game changer.

Would urge caution before deciding this is a game changer. There appears to be no fail-safe unilateral mechanism for the U.K. to exit the backstop, and already commentators close to Northern Ireland’s DUP, which supports May’s government in parliament, is raising doubts about how significant these “improvements” really are.

While several ERG members responded that they believed the agreement would fall short of the promises from the Brady Amendment, Jacob Rees-Mogg, one of the group’s leaders, struck an optimistic tone and said the agreement appeared to be an improvement.

We now await the inevitable walk-back from May’s cabinet and denials from Juncker and the EU27.

The article, "Pound Rallies As May Claims To Have Won Critical Brexit Concession", was syndicated from and first appeared at: http://feedproxy.google.com/~r/zerohedge/feed/~3/m4hqWAIuiZM/pound-rallies-may-secures-critical-brexit-concessions-eu.

You may find more great articles by Tyler Durden on http://www.zerohedge.com/fullrss2.xml/sites/default/files/images/user5/imageroot/draghi/CBO%20August%201.png/%2A%7CFORWARD%7C%2A.

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