Last week I reported that the German equivalent of the CBI had warned its members with business or investments in the United Kingdom to prepare for a very hard Brexit (see German Industry Federation advises its Members to prepare for a Hard Brexit 6 Oct 2017). As I have said before, the problem is how to guarantee British performance of the UK's obligations under any withdrawal treaty (see Dispute Resolution: A Potential Deal Breaker? 8 Aug 2017, Has Mrs May done enough to break the Logjam? 24 Sep 2017, Fourth Round of Brexit Talks: Still a Logjam 28 Sep 2017 and Brexit Briefing - September 2017 3 Oct 2017).
The performance of the other member states would be policed by the Court of Justice of the European Union. We are not prepared to accept that while the governments of the remaining member states cannot be expected to accept anything less. Until we have resolved that question there really is very little point in discussing anything else. Thus, a "good deal" or indeed any kind of deal with Europe other than those that exist under multilateral agreements just cannot happen. That is why the BDI is warning its members to prepare for a hard Brexit and indeed why my professional body is advising me to do the same (see German Industry Federation advises its Members to prepare for a Hard Brexit supra).
There does not need to be a breakdown of talks. I am sure that the present and any successor government would honour its obligations to its neighbours. It would be politically unthinkable to do otherwise. As I said in Fourth Round of Brexit Talks: Still a Logjam:
We may not have a written constitution but we do have rules that known as conventions that are at least as robust as those of other countries' constitutions. For instance, any Parliament could extend the 5-year limit to the duration of a Parliament originally contained in the Parliament Act 1911 and now re-stated in the Fixed Term Parliaments Act of 2011 but it would never do so. Would not an agreement between the main political parties not to repeal a withdrawal agreement statute be enough? The political reality for those who understand our constitution is that it probably would ....."However, I added: "that may not be how they see things from across the Channel."
So are there any other solutions? The Institute of Government, which describes itself as "the leading think tank working to make government more effective" has considered a number of options in Dispute Resolution after Brexit 2 Oct 2017 which can be downloaded from that link plus this useful little video The UK position on dispute resolution after Brexit 2 Oct 2017. Re-joining EFTA and relying on the EFTA Court seems to tick more boxes than any of the others according to the Institute's infographic, but it would not be very popular with hardline Brexiteers.
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Institute for Government