The WITHDRAWAL AGREEMENT between the UK and the EU: dispute settlement and EU powers (227 KB, PDF) The Withdrawal Agreement also sets up a dispute settlement procedure in which the UK and the EU do not agree on the interpretation or application of the agreement, but which will enter into force after the expiry of the transition period. In the event of a dispute, the UK and the EU will first try to resolve it in the Joint Committee. If this is not possible, the dispute may be submitted to an arbitration panel, which may make binding decisions. The Court of Justice of the European Union (CJEU) will provide the panel with interpretations of EU law issues. Non-compliance may result in the imposition of a lump sum or a continuous penalty payment, and non-compliance would ultimately give the complainant the right to suspend certain contractual obligations or elements of other agreements between the UK and the EU. This paper examines decision-making and dispute settlement in the UK`s withdrawal agreement from the EU. Once introduced (Section 1), Section 2 highlights the controversial nature of the institutional mechanisms, and in particular the competence of the CJEU during the negotiations, in order to provide the relevant context for the decision-making and dispute settlement provisions of the Withdrawal Agreement. Section 3 then sets out the governance aspects of the Agreement with respect to the diplomatic and technical institutional bodies that establish it. Section 4 therefore deals with dispute settlement provisions, including the continuing role of the Court of Justice of the European Union and the new inter-party settlement mechanism. Finally, Section 5 concludes and summarizes the main conclusions of the documents. The details of the arbitration clause alone would not give much reason to discuss. However, the arbitration panel is not the exclusive arbiter of disputes between the EU and the UK under the Withdrawal Agreement. A dilemma for the European Commission during the negotiations had to be to develop a dispute settlement mechanism that does not call into question the prerogative of the CJEU under the EU Treaties for the interpretation of EU law and the autonomy of the EU.
In point 17 of the Council Directives of 22. May 2017 for the negotiation of the Withdrawal Agreement, this is demonstrated by the statement that any dispute settlement mechanism “must fully respect the autonomy of the Union and its legal order, including the role of the Court of Justice of the European Union”. The simplest option would have been to transfer jurisdiction to the CJEU. In fact, this was the approach taken in the first draft of the Withdrawal Agreement, the first draft of the Withdrawal Agreement. .
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