Theresa May was widely expected to lose the parliamentary vote on her Withdrawal Agreement on Tuesday. Unsurprisingly, she has now rescheduled the vote until she has a chance to speak to European leaders. But assuming she loses the vote when it is finally held, attention will instead shift to what should happen next. It is of course highly speculative to predict the course of events at this point. Possibilities range from another referendum to leaving the EU with no deal at all. But one such possibility is the so-called ‘Norway+’ option.
Norway is a member of the European Economic Area (EEA) through the EEA Agreement. This agreement incorporates Norway into the EU’s Single Market. The EEA Agreement currently can only allow members of either the European Free Trade Association (EFTA) or the EU. Membership is optional for the former and compulsory for the latter. EFTA’s members are currently Norway, Iceland, Liechtenstein and Switzerland. The first three are also in the EEA, whilst Switzerland is not. Hence, Norway, Iceland and Liechtenstein are often refereed to as EFTA/EEA states.
The Norway+ option envisages the UK becoming an EFTA/EEA state, whilst also being in a customs union or arrangement with the EU (most say union). Membership of both of these, proponents argue, removes the need for any border checks at the Irish Border.
How good are the chances?
The likelihood of this option happening would seem to hinge on at least two key factors.
Firstly, the UK Government would need to decide to seek this option. With Theresa May as Prime Minister, this looks highly unlikely, given her repeated rejection of it. Were a new leader to take her place, they likely could not alter the Withdrawal Agreement, including the Northern Irish backstop. Parliament of course would still need to vote for that Withdrawal Agreement. Instead, they’d need to make clear in an amended political declaration that the UK intends to remain an EEA state, either as an EFTA state or via amending the EEA Agreement to allow a standalone UK pillar if the EFTA were to not consent to our joining.
The hope amongst proponents of the Norway+ option is that it could gain wider parliamentary support. But that hope’s materialisation is not clear at this point. For instance, many remain-supporting MPs would rather take the risk of a second referendum. Neither, it seems, would many, if any, leave MPs support it.
Secondly and just as crucially, the UK would need the consent of all current EFTA members to join their organisation. In addition, the UK would most likely need to gain the consent of the EU to pursue this option. Thankfully, The EU has said it would accept the UK retaining membership of both the Single Market and Customs Union. However, the possible consent of the current EFTA states is far less clear and is by no means guaranteed.
Switzerland and Liechtenstein have both been noticeably quiet, whilst positive noises have been seen in Iceland. Norway, on the other hand, has had a decisively lukewarm attitude. For instance, a Norwegian Conservative MP recently gave some reasons why Norway may refuse a UK application to join EFTA. The concerns raised are important to consider, despite her position as president of her country’s pro-EU European Movement,
In particular, the treating of the EFTA/EEA solution as a fall-back option (‘plan B’) has likely irritated EFTA states. Additionally, until recently, many proponents viewed EFTA/EEA membership as only temporarily (hence initially named ‘Norway for Now’). EFTA states may dislike the idea of being used for a short period before being left at the UK’s convenience.
Furthermore, the addition of a customs union to the Norway option will would also make EFTA membership difficult. This is because the EFTA Convention requires members to accede to EFTA’s global trade agreements (Article 56). Aligned with the EU Common External Tariff under a customs union, this would be legally impossible. The UK could try to gain a derogation from the EFTA Convention to deal with this. But then there is the danger that the UK will look like it is simply using EFTA once again, rather than using its considerable economic size to potentially benefit EFTA FTAs or the organisation as a whole.
Is Norway+ a forlorn hope then?
It is feasible that the negotiations on the future trade relationship could inevitably lead the UK back in a Norway+ direction. This particularly may be the case as the seemingly intractable problem of the Irish border continues. However, for the reasons discussed, the Norway+ option now looks unlikely to materialise.
This is a shame and a wasted opportunity. It was probably the best way, minus a customs union, to unite moderate leave voters with remain voters, and form something close to a compromise the country could live with. However, MPs of both leave and remain needed to have pursued the Norway option far earlier for it to have had the best chance. Those MPs would have needed to truly understood its considerable complexities, supported by political campaigners to provide the accurate factual briefing needed (see Leave campaigners like Dr Richard North, to whom this analysis owes considerable credit).
Instead, remain MPs who spent a referendum insulting the EEA have suddenly discovered its considerable advantages compared to other ways of leaving the EU and have consequently adopted it. Worse, they now treat the EEA like a political football, still frequently failing to grasp basic details about it, such as the rather unfortunate obsession with a customs union. Even now, they fail to think through a workable plan for it before publicly voicing their thoughts (see Nick Boles change from ‘Norway for Now’ to ‘Norway+’). It has been, to put it bluntly, a rather unconvincing Damascus conversion.
Assuming that an extension to the A50 negotiations could be secured from the EU and parliament successfully prevented no deal from occurring, then another referendum looks the most likely outcome of May’s anticipated defeat on her Withdrawal Agreement. This has been in small part helped by the recent European court judgement that A50 is unilaterally revocable. However, practical questions, such as whether the referendum should be a three question ballot, would still very much be up for debate.