EU’s Barnier urges UK to accept EU court deal for Brexit

European Union's chief Brexit negotiator Michel Barnier at the EU's General Affairs Council in Brussels. (Reuters)
Updated 26 May 2018
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EU’s Barnier urges UK to accept EU court deal for Brexit

  • Brexit negotiator says Britain playing "hide and seek" by delaying details on trade relationship.
  • UK ministers decry remarks as not "helpful."

BRUSSELS: EU Brexit negotiator Michel Barnier warned Britain on Saturday that failing to agree a deal on the governance of a withdrawal treaty which preserves the primacy of the EU court would mean no treaty and no transition period.

Barnier also described British delays in spelling out what kind of trade relationship London wants as “a game of hide and seek” in remarks prepared for delivery to a gathering in Portugal of jurists specialized in EU law.

He chided British criticism of EU positions as a “blame game,” urging London to recognize that it could not retain many elements of EU membership after Brexit.

The sharp tone of the former French minister’s remarks follow several days of talks in Brussels between his team of EU negotiators and British counterparts, after which a senior EU official dismissed as “fantasy” both London’s overall proposals for future close relations and an offer to avoid a disruptive “hard border” between Northern Ireland and EU member Ireland.

British ministers said those remarks were not “helpful.”

Barnier said he was ready to have “political level” talks to try to advance in three key areas where uncertainty remains, 10 months before Britain is due to leave in March 2019 — how to rule on future disputes over the withdrawal treaty, a “backstop” solution for the Irish border and a framework for future ties.

Referring to discussions within Prime Minister Theresa May’s government on whether to drop an insistence on having no customs union, he said: “If the United Kingdom would like to change its own red lines, it must tell us. The sooner the better.”
“We are asking for clarity,” he added. “A negotiation cannot be a game of hide and seek.”

On the issue of the governance of a withdrawal treaty, which both sides hope to have ready around October, Barnier repeated the EU’s insistence that primacy of the European Court of Justice inside the Union be maintained in regulating any dispute that could not be resolved by a joint committee appointed by the political leadership of the two sides.

“We cannot accept that a jurisdiction other that the Court of Justice of the European Union determines the law and imposes its interpretation on the institutions of the Union,” he said.

The role of British judges would be respected, he added.

But without an agreement on this, the whole deal would collapse: “Without an agreement on governance, there will be no withdrawal agreement and so no transition period.”

Many businesses are counting on an interim accord to maintain a broad status quo between Britain and the EU after Brexit until the end of 2020.

Barnier, who has been hoping to making substantial progress on key issues before May meets fellow EU leaders at a Brussels summit in a month, also criticized what he called a “blame game” in which British officials were accusing the EU of failing to show flexibility to allow continued close cooperation in areas such as security, the economy and research.

This, Barnier said, was to ignore the close legal framework within the EU which was the basis for trust and cooperation among its nation-state members. “We cannot share this decision-making autonomy with a third country,” he said.

“The United Kingdom must face up to the reality of the Union ... It is one thing to be inside the Union and another to be on the outside.”


Tesla nears 3-month low as JPMorgan adds to private deal doubts

Updated 20 August 2018
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Tesla nears 3-month low as JPMorgan adds to private deal doubts

  • Slashing its price target for Tesla from $308 to $195, the brokerage said it did not believe Chief Executive Officer Elon Musk had funds for a plan
  • Tesla shares fell nearly 4 percent

LONDON: Tesla shares fell nearly 4 percent on Monday as a $113 cut in JPMorgan Chase’s price target for the electric carmaker added to growing doubts among market players about a plan to take the company private.
Slashing its price target for Tesla from $308 to $195, the brokerage said it did not believe Chief Executive Officer Elon Musk had funds for a plan announced by a tweet that said “funding secured” two weeks ago.
Analysts from the US bank had upped its forecast from $198 to $308 after a roughly $100 surge in Tesla stock following Musk’s tweets on Aug. 7 and the note on Monday was the latest evidence of skepticism about the deal on Wall Street.
People familiar with the matter said on Sunday that PIF, the Saudi Arabian sovereign wealth fund that Musk says had been pressing to help fund the buyout, is in talks to invest in aspiring Tesla rival Lucid Motors Inc.
“Our interpretation of subsequent events leads us to believe that funding was not secured for a going private transaction, nor was there any formal proposal,” JPMorgan analyst Ryan Brinkman wrote in a client note.
“Tesla does appear to be exploring a going private transaction, but we now believe that such a process appears much less developed than we had earlier presumed, suggesting formal incorporation into our valuation analysis seems premature at this time,” Brinkman said.
JPM now targets the stock, which it continues to value at underweight, back at $195, versus Friday’s close of $305.50. The median price target of the Wall Street analysts covering Tesla is $336.
Tesla shares touched a three-month low of $285 in premarket trading before recovering to trade around $290, reducing its market value back below that of General Motors as the biggest US carmaker.
An interview with the New York Times, in which Musk said he was under major emotional stress in the “most difficult year” of his life, on Friday added to investors’ concerns over his leadership after a series of social media spats.
A person with direct knowledge of the matter told Reuters last week that the SEC has opened an inquiry related to Musk’s tweets on the buyout and the billionaire is also facing a class action suite from investors who lost money in the share moves.
“The lack of process to (Musk’s) announcement has now caused governance and competency concerns which are starting to snowball,” said Tigress Financial Partners analyst Ivan Feinseth.