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There has been a lot of talk over the last couple of days about the so-called ‘Malthouse Compromise’, but what does it actually entail? Below is a summary of the proposals.

Plan A – Revise negotiated Withdrawal Agreement and Framework

Outline:

  • Immediately table legal text to amend the Withdrawal Agreement to replace the backstop with an acceptable indefinite solution set out in A Better Deal, 12 Dec 2019
  • Maintain our offer on the rights of EU citizens in the UK, the agreed financial settlement, and the proposed Implementation Period
    (IP) until no later than Dec 2021, or sooner on conclusion of the Future Relationship (FR)
  • Require that, at the end of the IP or sooner, the UK shall negotiate fisheries access as an independent coastal state, under UNCLOS

Advantages

  • Rescues the Withdrawal Agreement
  • Maximises leverage plus secure a transition period
  • No backstop dangers: the new protocol is permanent, a “frontstop” and should be objectively acceptable to all.

Disadvantages

  • Uncertainty continues until the FR is ratified
  • Difficulty of persuading Eurosceptics to swallow:
  • – £39bn payment
  • – Saving the effect of the ECA during the IP
  • – Additional EU citizens’ rights
  •  – Other WA problems (DSC, CCP vs WTO)

Plan B – Basic transition agreement

Outline:

  • Continue to offer legal text for Plan A and bilateral cooperation in areas of mutual interest, including security, in a spirit of goodwill
    and cooperation
  • Unilaterally guarantee EU citizens’ rights
  • Uphold current standards, pending a comprehensive FR
  • Offer to pay our net contribution (c.£10bn pa) in exchange for the Implementation Period as negotiated, until no later than Dec 2021
  • Require that, at the end of the IP or sooner, the UK shall negotiate fisheries access as an independent coastal state, under UNCLOS
  • Work to agree an interim GATT XXIV compliant trading arrangement, pending a comprehensive FR
  • Revise our financial offer to the minimum compatible with our public law international obligations and submit to arbitration

Advantages

  • Offers a standstill to 2021 to enable negotiations
  • Preserves optionality
  • Secures time
  • Secures exit

Disadvantages

  • Risks EU conditions, legislation, extension
  • No Withdrawal Agreement
  • Eurosceptic concern about:
  • – Structure of standstill, esp saving ECA effect
  • – Money

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