The United Kingdom and the European Union are currently negotiating the UK’s Withdrawal Agreement from the EU.  One of the key issues in the UK’s Withdrawal Agreement from the European Union is the determination of the rights of 3.5 million EU nationals currently living in the UK and 1.2 million UK nationals currently living in other EU countries.

The topic of immigration loomed large in the UK’s referendum debate on continued EU membership.  In the same month as the referendum vote, an Ipsos Mori survey reported that 33% of those surveyed indicated that the number of immigrants coming to the UK was one of the most important issues influencing their vote.  Nevertheless, it is not disputed is that immigration has contributed to the social and economic success of the UK.

In an open letter to citizens of the European Union published on 18 October 2017, the UK’s Prime Minister Theresa May stated, “We want people to stay and we want families to stay together. We hugely value the contributions that EU nationals make to the economic, social and cultural fabric of the UK”.  Promising that “citizens’ rights are [her] first priority”, she confirmed that it is not her intention to use citizens’ rights as bargaining chips in Brexit negotiations.  Mrs May went on to promise: “I couldn’t be clearer: EU citizens living lawfully in the UK today will be able to stay [post-Brexit]” with an easy route to settlement (also known as permanent residency).

Soft Brexit

A “soft Brexit” would allow the UK to remain in the Single Market when the UK leaves the EU but it would require the UK to continue free movement of people.  In this event, the UK would use the full gamut of its abilities to set criteria to monitor and restrict the numbers of people settling in the UK from the EU.

The UK currently has the right to control its borders, having opted out of the Schengen system in the Treaty of Amsterdam.  EU citizens wishing to reside in the UK under freedom of movement rights must be workers, students, self-sufficient people or jobseekers. The UK can also introduce restrictions to free movement if it affects the country’s public policy, public health or public security.

A soft Brexit deal is likely to see the current status quo being largely maintained, but perhaps with the introduction of temporary controls such as quotas on migrants arriving from specific regions in the EU where in-flow is high.   Alternatively, controls may be placed on workers and self-employed migrants, while free-movement – but with the imposition of a light-touch registration system – is maintained for students and economically self-sufficient migrants.

Hard Brexit

The Home Office’s immigration policy document which was leaked to the press on 5 September 2017, indicated the Government’s inclination to take a “hard Brexit” (or “clean-Brexit”) stance in the withdrawal negotiations.

A hard Brexit could see the UK leaving the EU without a deal in place.  Donald Tusk, the President of the European Council, has been clear that a “no-deal scenario would be bad for everyone, but above all for the UK.”  Although Mrs May has tried to move away from her initial “no deal is better than a bad deal” position, when pushed she continues to defend that stance.  Indeed, with negotiations reportedly stalling, Mrs May is under pressure by senior donors to the Conservative Party to be ready for a no-deal Brexit, rather than accept a bad settlement from Brussels.

A no deal would see the UK leaving the Single Market and the Customs Union and trading with the EU on World Trade Organization rules.  This, in turn, is likely to mean no compromise by the UK on issues such as free movement and would see the UK applying strict measures on EU nationals wishing to make the UK their home.  In this scenario, the UK is likely to require EU nationals wishing to live, work and study in the UK to obtain a visa prior to arrival in the UK under the UK’s current points-based immigration system which is in-place for non-EU nationals.

Should this happen, the entitlement of British nationals to reside in the EU under free movement rights would also disappear, and British nationals in the EU should expect to face similar legislative barriers to remaining in the EU to live, work and study.

Mrs May and her Government face a stark choice between a bad deal and no deal at all.  However, Brexit is an opportunity to address the weaknesses and strengths of the current domestic immigration system and design a system fit for our modern economy and ensuring the UK continues to attract and accommodate people from all walks of life and from across the globe who each play a part in the economic and social success of the UK.

Author: Natalie Loader, Associate, Mishcon de Reya LLP