London: Britain has a new prime minister and is rapidly approaching its Brexit deadline of October 31.

But with negotiations on a divorce deal stalled, a “no-deal” exit from the European Union seems possible, even probable.

Why has it come to this and what would it mean?

Boris Johnson is contemplating a ‘no deal’ Brexit at the end of October.Credit:AP Photo

Given a no-deal is likely, what was the deal to start with?  

Former British prime minister Theresa May repeatedly failed to get approval from her Parliament for the divorce deal she struck with the EU.

It would have smoothed Britain’s withdrawal from the bloc, including settling debts, putting a two-year transition period in place to avoid a “cliff edge” for cross-border trade and travel, and guaranteeing the rights of EU citizens in Britain and vice versa.

It also included the Irish backstop, which would have imposed a swathe of EU regulations on the UK until the two sides could come up with alternative methods to keep the Irish land border free of customs checkpoints (both sides fear risking the hard-won peace on the island).

As May struggled to get Parliament to agree to the deal in April, EU leaders agreed to extend the UK’s EU membership “as long as necessary and, in any event, no longer than 31 October 2019”, to give the UK time to get the withdrawal deal ratified.

May then admitted that seemed impossible, and resigned.

So now, by force of law and international treaty, deal or no deal, Britain leaves the EU on October 31 (or earlier if both sides agree).

Anti Brexit demonstrators join Beatles fans, with signs reflecting Beatles songs, to walk across Abbey Road last week.Credit:AP

Can they do a new divorce deal?

New Prime Minister Boris Johnson has professed great confidence in striking a new withdrawal deal with the EU that would pass Parliament before the deadline.

He wants the “abolition” of the backstop, which he calls undemocratic, and instead to deal with the Irish border issue in a yet-to-be-negotiated trade deal.

Some of his colleagues are even agitating for what they call a “managed no-deal”, breaking the withdrawal deal into its constituent parts and rejecting much more of it.

In Brussels, this is dismissed as “cherry-picking” or “cakeism” – that is, wanting to have your cake and eat it too. Their view is that May's deal, two years in the making, is the only solution,although they are willing to rewrite some side agreements, including a declaration on ambitions for a future trade deal, and discuss how the backstop could be avoided through border controls developed during the transition period.

Ireland particularly wants the backstop clause, as an insurance policy that reconciles the need to keep the border peaceful with the need to police trade and travel to and from Northern Ireland after Brexit.

There appears to be little common ground. And there may not be time. Much of Europe is on summer holidays, and there seems to be much more action in Whitehall preparing for no-deal than in drafting a new deal to put to Brussels.

But many in business and politics still hold out hope for an eleventh-hour agreement.

British PM Boris Johnson inspects the egg operation, during his visit to rally support for his farming plans post-Brexit.Credit:AP

Could there be another extension?

The EU treaty allows any extension by unanimous agreement of all EU national leaders including the UK. The problem is political.

On the EU side some leaders – France’s Emmanuel Macron among them – want the UK out of their hair one way or another, so they can get back to other pressing issues within the bloc. But many observers expect another extension would be granted if there still seemed a fair chance of a withdrawal deal being done.

On the other side, though, Boris Johnson has repeatedly and explicitly said the UK would leave on October 31, using language such as “do or die”. In leadership debates, he was reluctant even to accept an extension of a few days.

He may be bluffing. But, politically, an extension would be seen as a fundamental betrayal of his party who put him in office.

Of course, Johnson might not be prime minister on October 31 (see below) – and his replacement could have another view.

Is a no-deal Brexit so bad?

In the 2016 referendum, voters were promised a quick and easy post-Brexit trade deal with the EU. But making a trade deal in the absence of a withdrawal deal would be neither quick nor easy.

All the problems the withdrawal deal was designed to solve would still need solving – now amid a breakdown of trust between the parties, the disruption and animosity this has generated, and with more legal and procedural hurdles.

A no-deal would hurt the UK and EU in the short and long-term. There would be new customs, trade and travel barriers between them, with exporters and importers facing new costs, tariffs, red tape and delays. A large amount of trade in goods and services would suffer a short-term shock and long-term decline. The pound would fall further, making life in the UK more expensive, and some goods including many foods would become more scarce in the shops. Some industries such as car manufacturing could face collapse.

The government and bigger businesses are increasingly well-prepared for this scenario – with options such as airlifts to bring in vital medicine, stockpiles in warehouses on UK soil and emergency subsidies to manufacturers and farmers.

Container terminals including Felixstowe, Southampton, London and Teesport stand to benefit from a no-deal Brexit because, unlike ferry ports, their reliance on traffic from Asia and the Americas means they’re already geared up for the customs checks that could accompany a no-deal split.Credit:Bloomberg

But no preparation can deal with the full impact, and small and medium businesses are much less well-prepared. And all this preparation costs billions of pounds.

Most experts predict the UK economy would take a hit on the level of a major global financial crisis (though this forecast is contested by a few pro-Brexit economists and business figures).

Some EU member nations would likely insist that the Irish border must be treated like any other, raising the prospect of new tensions and violence, and perhaps even a vote to unify Ireland.

And Scotland would see a big push for a new independence referendum, with polls showing a fair chance it could be successful in the no-deal aftermath.

Many Brexiters believe all this is worth the prize: true British (or, at least, English) independence from the EU.

Could Parliament prevent a no-deal Brexit?

The British Parliament has voted several times expressing its opposition to a no-deal Brexit. If MPs are prepared to take effective action they have several options.

They could pass a law requiring Johnson to seek an extension. They could pass a law requiring Johnson to revoke the UK’s decision to leave the EU. They could pass a vote of no confidence in the Johnson government and seek to install a new one.

All these options could provoke a constitutional crisis: the old riddle of whether the legislature or the executive (that is, the Crown) is supreme.

The Labour opposition could call a no confidence vote as early as September 3 when Parliament resumes, but it may feel this is too early, with anti-no-deal Tory MPs reluctant to bring down their own government until there appears no other choice.

But, if the vote comes too close to the end of October, the government may refuse to resign until Brexit is done – a highly controversial move that, apparently, is possible thanks to the UK’s vague and largely unwritten constitution (one expert said it assumes everyone would behave like "good chaps").

Some MPs have fantasies about the Queen intervening to save the day, however this would be out of character.

She has been around long enough to remember the backlash when her Australian governor-general tried something similar.

It is likely any constitutional crisis would need a political solution – possibly through an election.

Queen Elizabeth could be dragged in, but is likely to resist.Credit:AP

Will there be an election?

After a July byelection the Johnson government’s working majority in Parliament fell to just one seat – including the support of the Northern Irish DUP. That makes it hard to govern.

There is rampant speculation the Conservatives are preparing for an election either just before or just after Brexit – a theory backed by key appointments and a rush of policy announcements.

If Parliament blocks his Brexit plans, Johnson may go for a “people v parliament” election to get a mandate for them.

This could even be used as “cover” for a no-deal Brexit. Caretaker governments are not supposed to make big decisions but (see above) the Queen would likely be reluctant to kick out Johnson and impose a caretaker PM to ensure a Brexit extension.

However, the British public don’t like snap elections called as a political tactic. With Brexit not yet done, the Tories would lose Brexiter votes to Nigel Farage’s Brexit Party and Remainer votes to the Liberal Democrats, opening the door for a Corbyn Labour government, whose Brexit policy can best be described as obscure.

It is unlikely Johnson or the Tories want to lose government for the sake of winning Brexit.

It is more likely that Johnson would prefer an election shortly after Brexit, deal or no deal, even amid whatever turmoil results.

Then, Labour’s continuing woes under Jeremy Corbyn and the Brexit Party’s collapse with its job done could be enough to deliver a secure Johnson majority.

Could Brexit be reversed?

At any time before the UK leaves the EU, the government could cancel the whole thing with a simple request to Brussels.

This is very unlikely as things stand, but it’s an option some Remainers still dream of – most commonly following a second Brexit referendum to give a level of political cover. A new referendum would require an act of Parliament and an extension of the Brexit deadline.

After Brexit, however, if the UK wants to rejoin the EU it would have to go through the same application process as any other country: a (usually) slow and painstaking path that includes (since 1992) adopting the euro currency.

Some have publicly speculated the UK could later pretend Brexit never happened by passing retrospective legislation. This theory has been widely discounted by experts on EU law.

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