Britain’s tough attitude is not afraid to prosecute, may jeopardize other countries’ agreements, the pound is falling worryingly

Original title: UK has a tough attitude without fear of prosecution, which may jeopardize the agreement of other countries. The pound is worrying and falls.

FX168 Financial News (North America) NewsOn Thursday (September 10), the European Union (European Union) told the UK that it should urgently cancel the Internal Market Act and withdraw it by the end of this month. But the government of British Prime Minister Boris Johnson rejected this request and went ahead.

The European Union said the British proposal “seriously damaged confidence” and London must take steps to rebuild confidence. The EU will use the withdrawal agreement to take legal action against the UK. “Failure to comply with the terms of the withdrawal agreement would violate international law, undermine confidence and jeopardize the ongoing negotiations on future relations,” the European Commission said in a statement Thursday. “The Brexit agreement contains a number of legal mechanisms and remedies to solve the problem of the violation of legal obligations contained in the text of the agreement; the EU will not be ashamed to use these legal obligations.”

But after meeting with the Vice President of the European Commission, Maros Sefcovic, Michael Gove, the British cabinet minister, made it clear that the United Kingdom would not withdraw the Internal Market Act.

He said: “We must ensure that the agreement reflects that Northern Ireland is an inalienable part of the United Kingdom.” “We are waiting for a debate on the internal market bill in Parliament.” “The internal market bill is vital.” Need “.” I hope we can see progress in the coming weeks, but I shouldn’t speculate on the chances of success. “

The British government said the bill will be debated on Monday and issued legal opinions, as well as that the British Parliament has sovereignty, so it can effectively act according to its own wishes. “Parliament enjoys sovereignty in national legislation and can pass laws that violate British treaty obligations. Parliament will not violate the Constitution when enacting such legislation.”

But Britain’s failure to comply can jeopardize trade deals with other countries. The Speaker of the US House of Representatives, Nancy Pelosi, said: “If the UK violates this international treaty and Brexit undermines the peace deal, the US-Britain trade deal will never be approved in Congress.” .

Many British politicians and lawyers have also issued warnings, saying that violating legally binding international commitments will damage Britain’s reputation for maintaining law and order. “If we can’t keep our promises on this matter, who else will believe us in the future?” Said Edward Garnier, a former British Deputy Attorney General.

Therefore, although European and British officials still have hopes of reaching a trade agreement, as pointed out by the president of the European Commission, Ursula von der Leyen, they will rewrite the one signed just a few months ago. An attempt to reach a treaty undermined trust between the two parties. And the international precedent it creates can undermine people’s confidence in the British government signing its own commitments, which in turn will make it difficult for the country to sign many bilateral trade agreements with other countries once the country cuts ties with the single market in Europe. .

Affected by this news, the pound / dollar once fell to 1.278 and then recovered, but the drop was as high as 1.25%.

(5-minute chart of Pound / USD, source: FX168)

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