Summary:

• In the early hours of 11 April, the EU and the UK agreed to delay Brexit until 31 October 2019, removing the threat of the UK crashing out with No-Deal on Friday 12 April.
• The EU’s decision operates as a “flextension”: if the UK Government is successful in its talks with the opposing UK Labour party and the Withdrawal Agreement it negotiated with the EU is ratified by UK Parliament at the fourth time of asking, Brexit can still be implemented before 31 October 2019.
• Under the terms of the flextension, the UK must now take part in European Parliamentary elections on 23-26 May: in the unlikely event it fails to do so, a No-Deal Brexit would occur on 1 June 2019. In addition, the EU has stated it will review the UK’s progress in Brexit negotiations at the European Council summit in Brussels on 20 June 2019.
• Whilst the EU’s granting of the flextension has been welcomed in that it removes the immediate threat of No-Deal Brexit tomorrow, there is still a lack of certainty and tangible progress around the Brexit process. European Council president Donald Tusk has urged the UK to “not waste this time”, but he noted that the EU could offer an extension again in October, acutely aware that the political position in the UK remains unstable.
• The breathing space allowed via the six-month flextension is likely to result in continued strategic maneuvering between rival UK political factions, as the wide variety of options – a UK Conservative leadership contest to elect a new prime minister, a General Election, a Second Referendum, or an outright revocation of Article 50 – remain on the table.

  

• Meanwhile, UK and European businesses remain in a state of flux. The director general of the British Chambers of Commerce noted in a statement that the flextension means that businesses “will be relieved…but their frustration with this seemingly endless political process is palpable”.