Richard North, 15/08/2018  
 


In July 2016, Peter Lilley received from me a copy of this document, the Leave Alliance Brexit Monograph 2, entitled "The WTO Option and its application to Brexit". In it, I concluded that the option was "a very dangerous and potentially expensive option which could do significant damage to the EU and UK, the effects of which could be long-lasting".

I know he read it because, a month later he issued a rebuttal, attempting to counter my points. In fact, he only offered six points, some of which refer to arguments I don't recall making.

His core argument was that I was under-estimating the power of the status quo. "It may be logical and theoretically possible", he asserted, "to declare all existing customs and other trade facilitating agreements and procedures invalid – but it won't happen! Indeed, so far as I am aware that has never been done even to countries subject to trade sanctions".

Thus, in the view of the Noble Lord, although we might leave the EU without an agreement and, in accordance with Article 50, the treaties would cease to have effect – thereby negating all existing customs and other trade facilitating agreements and procedures – these would continue in effect.

As regards the Union Customs Code, running to over 1,300 pages, Lilley translated this into 1,600 pages and declared that "the UK can and should incorporate them into UK law, with relatively minor amendments". And this was his considered response to my comments that:
Outside the EU, though, it is unlikely that this law could just be copied out. Substantial adaptation would almost certainly be needed. This would be a complex and time-consuming process and, assuming that the UK had lost Union law as a result of the expiry of the Article 50 process, it might be an unplanned event.

No doubt a series of emergency orders could be rushed into place but, during the period when new legislation was being produced, there would be no legal code applying to UK Customs operations.

Temporary measures aside, it is difficult to see how a comprehensive code could be quickly or easily replicated, even if there were the personnel available with the necessary skills and experience. This might be further complicated by certain aspects requiring Union and international recognition.
As regards access to EU Member State markets, he offered what has become the mantra on such issues, that "the UK starts off in full conformity with EU product regulations etc so there can be no problem agreeing 'regulatory conformity' at the point of Brexit, even if we have to agree at a later stage how to avoid divergence".

And when it came to the 900 or so formal agreements that the EU has with its trading partners, these presented no problem. Said Lilley:
We should be able to novate to the UK the network of trade facilitation agreements to which the EU is party, again with only minor technical amendments. The fact that such agreements exist between all WTO members, even those which have no bilateral Preferential Trade Agreements and even between countries hostile to each other, suggests that they are unlikely to be thrown aside for bureaucratic reasons or to teach us a lesson.
Two years later, the Noble Lord is arguing in The Times that it is time to recognise that "no deal" is likely, leaving us to trade with the EU on World Trade Organisation terms.

Interestingly – and perhaps indicative of the weakness of his original arguments – Lilley does not rely on any of the points he made back in 2016. But since then, the issues have to a certain extent clarified and certain specific issues have been highlighted as constituting the downside of what is called the "WTO Option".

The more prominent of these - motorways becoming lorry parks, food and drug shortages, planes grounded - Lilley dismisses out of hand, asserting that they emanate "largely from Remainers’ fevered imaginations".

As with so many others, the man drops into the familiar binary framing – leavers versus remainers. Never mind that, long before the implications of a "no deal" exit were being rehearsed in the legacy media, this leaver was raising the alarm. But while then I might have been the focus of Lilley's scorn, I have since become invisible.

Nonetheless, the sloppiness and superficiality of the media alarums has given Lilley something of an opening, which he exploits with relative ease. "How we control imports is in our hands", he says, going on to assert that: "Lorries laden with fresh food will not be queuing for hours at Dover since Dover sees no need for new physical checks".

Undoubtedly for different reasons, I would not disagree with the man. I've written a number of times of the likelihood that the UK government would waive border checks on fresh foods coming in from EU Member States. I've pointed to the national security exemption in the GATT Agreement, on which the UK could rely. But whatever legal cover is adopted (or not), no government is going to stand idly by and let food run out. Its own survival depends on the population being fed.

As to revenue issues, Lilley also asserts "that tariffs would be collected electronically like excise and VAT". If, he says, "some firms initially fail to complete electronic customs declarations, HMRC will avoid delays by waving lorries through". Again, I don't think he's far wrong.

Thus far, the media have given him some straw men to play with, with Lilley correctly pointing out that we will continue to authorise medicines we currently import. He adds that "the EU can either reciprocate or put their patients at risk", which is a reasonable enough point.

If the EU rigidly refuses to accept medicines produced by UK holders of market authorisations, there is a risk that patients in member states will go short. The EU will have to find a "fix" for this problem, until the situation can be resolved permanently.

Lilley is on less than secure ground, however, when he cites BA's Willie Walsh, who has "dismissed fears of planes being grounded". Walsh's comment comes in the context of his believing that a deal will be made. Lilley is telling us that we should not pursue one. He cannot have it both ways. And nor can he take any comfort from his claim that continental airlines are selling tickets way beyond March 2019. At this stage, they can do nothing else.

On the other hand, one might be charitable and concede Lilley's point that "Spain would not forgo 1.5 million British tourists a month", recognising that this would give the UK some leverage when it came to settling an aviation deal.

But what this points to is a logical flaw in Lilley's entire argument. We do not rely on the WTO for our aviation arrangements and, for there to be flights to mainland Europe, there will have to be a deal. Lilley's "no deal" can't exist. There must be some deals, some of which must cover aviation.

His logic continues to fall apart when he asserts that, if the French slow down Calais, the Dutch and Belgian ports want the business and will offer speedier service. This is little short of bizarre. Apart from the fact that Calais handles volume RO-RO traffic, for which there are insufficient facilities in Holland and Belgium, he has clearly lost sight of the fact that we are dealing with the EU and its common regulatory code. What applies to France will also apply to all other EU Member States.

But we then go from the bizarre to the evil. The application of the Member States of the EU acquis - which they are bound in law to apply – is characterised by Lilley as "hostile non-cooperation", something which is manifestly false. After all, one of the primary reasons for leaving the EU, cited by Vote Leave, was to "take back control". Inside the EU, we are bound by EU law.

But the man develops this with a completely specious argument, making out that this "hostile non-cooperation" would be "not only impractical but triply illegal". Says Lilley:
It contravenes the EU's constitution, which requires it "to establish an area of good neighbourliness" with neighbouring countries; the WTO treaty which forbids discrimination against trading partners; and the new trade facilitation treaty which commits members to facilitate trade not obstruct it.
None of these things are true in the context of prohibiting or restricting the EU's current raft of border controls. His assertions are a perverse invention, completely lacking in merit. There is nothing to support these claims and Lilley offers nothing to support them. And without so doing, Lilley cannot justifiably deny that the effect of the WTO option will be disastrous.

Here then, we come to the nub of the matter. What on earth is The Times doing in publishing these completely unsubstantiated claims, giving an obvious polemicist a free pass to promote damaging untruths?

We would not advocate censorship, but newspapers such as The Times and the media generally have a duty to the public not to mislead them or to allow others to do so. The assertions made represent a major failure in editorial judgement of a journal that was once regarded as the "newspaper of record".

In the Brexit debate, there is no stopping the likes of Lilley retailing his poisonous wares. Whether he is a liar or not is an academic (or theological) judgement, but there can be no doubt that he is devoting himself to spreading untruths. It is no part of the media's role to help him do it.






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