January 23, 2019 / 5:43 PM / 4 months ago

Trade experts dismiss Brexiteers' faith in obscure WTO clause

GENEVA (Reuters) - Trade experts have poured cold water on the idea that Britain could invoke an obscure clause in the international trade rules if it leaves the European Union without an agreement, but they say the claim keeps resurfacing to justify a no-deal Brexit.

FILE PHOTO: 'Leave Means Leave' supporter Richard Tice speaks during a "Leave Means Leave" rally in London, Britain January 17, 2019. REUTERS/Simon Dawson/File Photo

Pro-Brexit campaigners say even if Britain and the EU fail to agree terms for their divorce, Article 24 of the World Trade Organization’s (WTO) General Agreement on Tariffs and Trade would let them keep trading as now for up to a decade.

“People could carry on pretty much as is,” Richard Tice, vice-chairman of pro-Brexit campaign group Leave Means Leave, told BBC radio this week.

Although there is a clause in the rules that allows for interim agreements, WTO spokesman Keith Rockwell said it also requires the two sides to provide a plan and reasonable time-frame for their deal to take shape: a distant prospect.

“This presupposes, of course, that both the UK and the EU agree on the process of negotiating a deal, whatever form that deal may take. It would also require that both parties agree to an interim deal,” he said.

Trade lawyers are exasperated that Article 24 keeps resurfacing, despite their attempts to knock it down.

“It’s amazing how this awful misinterpretation of Art XXIV GATT won’t die, no matter how many times I point this out,” Lorand Bartels, reader in international law at the University of Cambridge, tweeted in May last year.

“It’s utter nonsense,” former Australian trade negotiator Dmitry Grozoubinsky tweeted in December.

“It relies on your being too busy to read Article XXIV of the GATT, or too confused by trade legalese to parse it.”

On Monday, Prime Minister Theresa May also weighed in after pro-Brexit Conservative member of parliament Owen Paterson told her that if Britain could trigger article 24, it would allay fears about high tariffs in a no-deal scenario.

May said the idea was “perhaps not quite as simple as some may have understood it to be”.

“My right honorable friend’s expectation that it is simply possible to leave with no deal and immediately ​go into that situation does not actually reflect accurately the situation that the United Kingdom would find ourselves in.”

Reporting by Tom Miles; Editing by Andrew Cawthorne

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