EU Leaders Vow to Seek `Orderly' U.K. Withdrawal From Bloc

(Bloomberg) -- European Union President Donald Tusk pledged to seek an “orderly” Brexit after U.K. Prime Minister Theresa May set in motion the process for the first withdrawal of a country from the bloc.

Tusk referred to “difficult negotiations ahead” as the leaders of Britain’s 27 fellow EU nations pledged to work “constructively” with the government in London and expressed hope that the U.K. would be a “close partner” after Brexit. The EU “will remain determined and united,” he told reporters in Brussels on Wednesday.

“Our first priority will be to minimize the uncertainty caused by the decision of the United Kingdom for our citizens, businesses and member states,” the EU government chiefs said in a joint statement after Tim Barrow, Britain’s ambassador to the bloc, delivered to Tusk a hand-signed letter from May invoking the European treaty article on secession. “We will start by focusing on all key arrangements for an orderly withdrawal.”

The two-year Brexit process will test the EU’s ability to tame populist forces on the rise across Europe, deepen integration in areas ranging from the euro to defense, seal free-trade pacts with the likes of Japan and limit damage to commerce and finance as a result of a divorce with the bloc’s No. 2 economy.

Making Good

May is making good on her pledge to respect a June 2016 U.K. referendum in which 52 percent of voters opted to leave the EU after more than four decades of membership. The ballot’s outcome led May’s predecessor, David Cameron, to resign, has reignited an independence drive in Scotland and has prompted leaders in Europe to express regret while vowing firmness in the Brexit talks.

Britain’s EU partners are seeking initial agreements in the upcoming negotiations on a U.K. divorce payout of up to 60 billion euros ($65 billion) and on the rights of citizens from across the bloc who live in the country. Also on the priority list is a deal on the land border between Ireland and Northern Ireland, which stayed in the U.K. after Irish independence in 1922 and which suffered decades of deadly violence before the arrival of the European single market and a peace accord.

European officials have signaled that progress over these three matters in the coming nine to 12 months could pave the way for parallel talks with Britain over a free-trade accord that would take effect after the country leaves.

The discussion alone of Britain’s exit bill is “certainly” going to provoke “a dogged fight,” Austrian Chancellor Christian Kern said in an emailed statement on Wednesday in Vienna.

Political Tensions

In another sign of the potential for political tensions, the European Parliament, which must endorse any Brexit deal, plans to say that the U.K. must “honor all its legal, financial and budgetary obligations.” 

In a draft resolution obtained by Bloomberg News and due to be voted on next week, the European assembly also warns the U.K. against starting free-trade negotiations with countries outside the EU during the Brexit process, saying such a step would violate the bloc’s law. 

Furthermore, the draft resolution says any “transitional arrangements” with Britain after Brexit should be limited to no more than three years.

Jean-Claude Juncker, president of the European Commission, the EU’s executive arm, said in January that the Brexit negotiations will be “very, very, very difficult.” The EU’s lead Brexit negotiator, Michel Barnier, said last week that there would be “serious consequences” were the U.K. to leave the EU without an agreement.

Common Interests

The German government will fully support the commission and Barnier to “enforce our common interests in the negotiations,” Foreign Minister Sigmar Gabriel said in Berlin on Wednesday.

In their statement, the EU leaders left open the possibility of no accord with Britain, saying they would “strive to find an agreement.” Tusk plans to draft negotiating guidelines for Barnier that the leaders intend to approve on April 29.

Down the street from where Tusk spoke with May’s six-page letter in hand, nearly two dozen supporters of Brexit celebrated at an Irish pub by drinking champagne, eating cake and watching a televised House of Commons debate on the trigger moment.

“Today is the beginning of the end of the European Union," said David Coburn, a U.K. Independence Party member of the EU Parliament. “Our leaving is going to bring it down.”

--With assistance from Ian Wishart Viktoria Dendrinou Aoife White Peter Flanagan Rainer Buergin Patrick Donahue and Boris Groendahl

To contact the reporters on this story: Jonathan Stearns in Brussels at jstearns2@bloomberg.net, Marine Strauss in Brussels at mstrauss30@bloomberg.net.

To contact the editors responsible for this story: Alan Crawford at acrawford6@bloomberg.net, Jerrold Colten at jcolten@bloomberg.net, Jones Hayden