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Court rules to put Brexit to Parliamentary vote

U.K. Prime Minister Theresa May
Theresa May

The U.K. Supreme Court ruled Tuesday that Parliament must vote on whether the government can trigger the Brexit process.

The court was asked to decide whether the U.K. government can trigger Article 50 of the Lisbon Treaty without prior authorization by ministers and peers. By an 8-3 vote, the court ruled that an act of Parliament is required to authorize the government to give notice of the U.K.’s decision to exit the European Union. Triggering Article 50 starts the clock on a two-year time frame, after which treaties governing the EU will cease to apply to the U.K.

U.K. Prime Minister Theresa May has said she intends to trigger Article 50 by March 31.

“Withdrawal makes a fundamental change to the U.K.’s constitutional arrangements, by cutting off the source of EU law,” said a summary of the judgment. “Such as fundamental change will be the inevitable effect of a notice being served. The U.K. constitution requires such changes to be effected by Parliamentary legislation. The fact that withdrawal from the EU would remove some existing domestic rights of U.K. residents also renders it impermissible for the government to withdraw from the EU treaties without prior Parliamentary authority.”

The court also ruled that the U.K. government does not need to consult with the governments of Scotland, Northern Ireland and Wales. “The devolution acts were passed by Parliament on the assumption that the U.K. would be a member of the EU, but they do not require the U.K. to remain a member,” said the summary. “Relations with the EU and other foreign affairs matters are reserved to U.K. government and parliament, not to the devolved institutions.”

The pound sterling had a volatile morning, falling 0.2% to $1.2452 between 3:30 a.m. and 6:10 a.m. EST.

“The Supreme Court ruling was no surprise and preserved the constitutional sovereignty of Parliament,” said Andrew Parry, head of equities at Hermes Investment Management. “As they were not prescriptive on the form legislation required, it is likely that the government will present a short bill to speed its progress through Parliament.”

“Anyone expecting this process to be reversed — would Europe even want us back? — or quick are deluding themselves,” Mr. Parry added. “The negotiations will be protracted and the new legislation to replace repealed European laws will still have to go through Parliament, so expect this story to run and run. The probability of a hard Brexit remains high, though that will depend, in part, on the negotiating stance of the EU. The more punitive the response, the more likely that Britain will go for broke.”