Will the UK stay inside the single market after it has left the EU?

It has been widely reported that the government is facing its second legal battle over the process of leaving the EU, this time on whether the UK should stay inside the single market after Brexit. The single market is an association of countries that allows the tariff-free movement of goods, services, money and people within each other without restrictions.  

A pro-single market campaign group, British Influence, has hired lawyers to argue that leaving the EU does not automatically take the UK out of the European Economic Area ("EEA"), in which the single market operates. This will mean that ministers could be stopped from taking Britain out of the single market after the government has insisted that EEA membership automatically ends when Britain leaves the EU.

It will be argued that the additional step must be decided by parliament separately from any vote to trigger Article 50, but some lawyers are questioning that leaving the EEA would not be automatic and would only happen if Britain formally withdraws by triggering Article 127 of the EEA agreement.

If the courts back the legal challenge enabling Parliament to have the final say over the EEA membership, then MPs could vote to ensure that Britain stays in the single market until a long-term trading relationship with the EU has been agreed.

The argument is centred on whether the UK is a member of the EEA in its own right, or because it is a member of the EU. British Influence have written to David Davis, the Brexit Secretary, suggesting that the government should focus on Articles 127 and 128 of the EEA agreement, instead of solely on Article 50 of the treaty on the EU.

However, non-EU countries such as Norway, Switzerland, Iceland and Liechtenstein, have created the European Free Trade Association ("EFTA") to promote economic ties. Before joining the European Community in 1973, the UK was a founding member of the EFTA. However, it has been reported that Norway could potentially block any attempt by the UK to re-join the EFTA after Brexit.

If MPs do get to decide on Article 127, and vote to remain inside the single market after Brexit, this result could potentially infuriate many Brexit campaigners. However, the ability to stay on in the single market means Britain could force the EU into accepting a transitional period for the UK to avoid any immediate economic impacts.