European Commission finance chief Günther Oettinger has admitted that there is “not really a court” that could force the UK to pay the EU the Brexit ‘divorce bill’.
The admission came after Conservative Party leadership candidate Boris Johnson said last week he would withhold the payment in exchange for a better exit deal from the EU.
Brussels maintains that the sum has already been agreed between its bureaucrats and London, and that the £39 billion covers unspent commitments the UK made to the EU and any liabilities to the EU budget as well as covering the 21-month transition period. But the bloc also expects this money to be paid even in the case of a no-deal Brexit where there would be no transition.
While senior figures in Brussels have claimed that withholding the bill would be illegal, the European Commissioner for Budget and Human Resource admitted in comments reported by The Guardian: “If a future government would not be ready or willing to pay then the problem is there’s not really a court to settle the dispute, but we do have some arguments.”
European Leaders Get Fret Over Suggestion Britian Could Withhold £39 Billion 'Brexit Bill' https://t.co/63qZaRtlJ2
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Mr Oettinger then offered a veiled threat that to ensure the “relationship between the UK and the EU has a future” — such as “in terms of imports and exports”, the Galileo satellite programme, and academic partnerships — “we need to settle old debts fairly”.
In response to Mr Johnson’s threat last week, French president Emmanuel Macron claimed that “Not honouring your payment obligations is a failure of international commitments equivalent to a sovereign debt default, whose consequences are well known.”
However, Standard & Poor’s (S&P) does not hold that position, with the international credit rating’s primary analyst for the UK, Aarti Sakhuja, telling Reuters: “Our ratings speak to commercial debt obligations… The UK not paying the 39 billion pound bill would therefore not constitute a sovereign default under our methodology.”
Credit agencies Moody’s and Fitch took a similar position.
British lawyer Martin Howe QC, from the pro-Brexit group Lawyers for Britain, had written in a 2017 paper that the divorce bill is not legally binding, saying: “In law, we will owe no money at all to the EU when account is taken of what we are owed for the return of capital the UK has in the EIB [European Investment Bank].”