A glossary of Brexit

London – As Britain embarks on the path to Brexit, here is a short glossary to make the months of negotiations ahead a little less confusing:

Brexit

Born out of the contraction of “British” and “Exit”, Brexit means the UK’s withdrawal from the EU.

It is based on the same format as “Grexit”, a term coined in 2012 by two economists from the American financial giant Citigroup to describe the potential expulsion of Greece from the eurozone.

“Brexit” was penned a few months later by the head  of the London-based British Influence think tank.

Article 50

Also known as the “withdrawal clause”, Article 50 was introduced in the EU’s Lisbon Treaty signed in 2007 and brought into force in 2009.

“Any Member State may decide to withdraw from the Union in accordance with its own constitutional requirements,” it reads.

By triggering it, London is formally informing the European Council of its wish to leave the bloc.

Transition deal

Two years of formal negotiations follow the triggering of Article 50 to establish future ties between Britain and the EU.

British businesses are keen to avoid a “cliff edge” after that and have lobbied for a transition period during which existing legislation will continue to apply even after Britain has left.

But Brussels has already signalled that it would be “difficult to imagine” an interim deal being put in place before the terms of the future relations between the UK and the EU are set.

DexEU

DexEU is the unlovely acronym for the “Department for Exiting the European Union”, the ministry set up by Prime Minister Theresa May to negotiate the Brexit deal.

Created in July 2016 following her appointment as prime minister, it has had to urgently hire hundreds of people to staff it.

At its head is Brexiteer David Davis, but the strategy has so far remained firmly under Downing Street’s purview.

Single market

Also called the internal market, Europe’s single market allows for the free movement of people, goods, services and capital within any EU member state.

These are known as the “four freedoms”.

‘Hard’ Brexit

May has put Britain on a path to what commentators are calling a “hard Brexit”, mainly because of her intention to leave the EU single market.

Doing so, the prime minister said, would enable the country to regain control of its immigration policy.

But it will also mean a return to tariff barriers, although May has since called for an “ambitious and bold” deal on future trade ties.

A “soft” Brexit would mean staying in the single market.

Customs union

Comprising the 28 EU member states – including Britain – as well as Turkey, Andorra, Monaco and San Marino, the European customs union is the biggest in the world.

Not only have its members abolished many customs duties and trade restrictions between themselves, they have also adopted a common trade policy and customs duties towards third countries.

European Economic Area (EEA)

Since 1994, the EEA extends the single market’s “four freedoms” to Norway, Iceland and Liechtenstein.

These three countries, along with Switzerland, are the remaining members of the European Free Trade Association.

The EEA also includes several agreements on competition, consumer protection and education.

Because it also does not include a deal on customs tariffs, the EEA cannot be considered a customs union.

European Free Trade Association (EFTA)

Founded in 1960 as a parallel entity to the growing European Economic Community, the EFTA once counted 10 members, including Britain.

But the trade organisation lost some of its substance over time as members departed to join the European Union.

European ‘passport’

This package authorises the sale of a financial product anywhere in the EU provided at least one national regulator has approved its sale.

Some companies have already said they might have to move or relocate some of their activities on the continent if Britain were to lose this “passport”.