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Brexit Bulletin: One Last Chance

Brexit Bulletin: One Last Chance

(Bloomberg) -- Today in Brexit: There will be no cliff-edge Brexit on March 29.

Theresa May didn’t get any dinner, but after a tasty evening in Brussels the British got a whole menu of Brexit options.

The U.K. prime minister came to Brussels arguing for a Brexit delay until June 30. She didn’t win the day at Thursday’s European Union summit, but she did get an extension. In an unusual move, EU leaders went over a draft proposal line by line, crafting a new approach to the final phases of the Article 50 process.

So what happens now? Well, if the House of Commons passes the twice-rejected Brexit deal in the coming weeks, Britain will have until May 22 to complete its withdrawal from the EU. That’s the simple equation.

More nuanced is what happens if the deal doesn’t pass. In that scenario, the cliff-edge is merely delayed until April 12. If May has no agreement in place by then and chooses not to participate in European elections, we’re back into no-deal territory. If she has no accord in place and wants to seek a longer extension, she’ll need to hold those elections.

“The cliff edge will be delayed,” EU President Donald Tusk said after May accepted the proposal. “I was really sad before our meeting, now I’m much more optimistic.” That wasn’t his tone during the meeting, a person familiar with proceedings said. 

There was an absurdist thread running right through Thursday. The day started with a “Revoke Article 50” petition going viral, before Luxembourg Prime Minister Xavier Bettel compared the Brexit process to Samuel Beckett’s tragicomedy Waiting for Godot. Hours later, as extension debate swirled, the leaders agreed to work on Brexit through dinner. The upshot of that? No food for Theresa May, who was denied langoustine with lentils, duck with orange and an assortment of chocolate cakes. An apology was apparently offered.

In the end, most were relieved. Theresa May seemed more emollient than 24 hours earlier, when she scolded members of Parliament from a Downing Street lectern. She insisted she would work to ensure the U.K. leaves with a deal, not without.

For her European counterparts, a brewing crisis next week had been avoided, but not yet solved. 

“The EU does not have all the cards in its hands,” French President Emmanuel Macron told reporters. “The EU has to face a British political crisis. It’s a complete political and democratic crisis, and it’s a British crisis.”

Asked by one journalist exactly how long a “long” extension might be, European Commission President Jean-Claude Juncker came up with an answer May at her most opaque might have been proud of:

“Until the very end.”

Today’s Must-Reads

Brexit in Brief

On the Markets | The pound recovered from its steepest drop since January after the extension bought some time to avoid a no-deal Brexit. Sterling was slightly higher against the dollar in early trading at $1.3143.

Joining Forcs | The U.K.’s biggest business lobby group took the rare step of joining forces with labor unions to warn Theresa May that she’s presiding over a “national emergency.” Confederation of British Industry Director General Carolyn Fairbairn and Trades Union Congress General Secretary Frances O’Grady also requested an “urgent meeting” with the prime minister.

Parliament Arithmetic | Brexit realities mean the U.K. is going to end up with “something that’s founded on a customs union” with the EU, according to Karen Ward, chief market strategist for Europe, Middle East and Africa at JPMorgan Asset Management. Roughly 300 lawmakers oppose May’s deal because they want a softer Brexit, Ward told Bloomberg Television, meaning a move in that direction could help seal a deal.

Emissions Decisions | Britain’s effort to delay its departure probably means that U.K. polluters will have to wait to get their hands on 2.6 billion euros ($3 billion) of emission allowances, according to a person familiar with the British government position.

Two Million Names | The anti-Brexit petition just kept on growing as the day went on, topping two million signatures as May and the EU sealed a Brexit delay in Brussels. The tally passed 1 million shortly before 3 p.m. London time Thursday after the link to the petition went viral, and passed 2 million just after 10:35 p.m.

Brexit Bulletin: One Last Chance

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To contact the editor responsible for this story: Jones Hayden at jhayden1@bloomberg.net, Timothy Coulter "Tim"

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