By Gökhan Kurtaran
London letter, week beginning Nov. 7

- Brexit court decision opens up Pandora’s box

Last week’s High Court decision created a new obstacle for U.K. Prime Minister Theresa May’s Brexit policy in triggering Article 50 by no later than March next year. In accordance with the court’s decision, the Prime Minister has no power to trigger the two-year exit process, Article 50, without the approval of Parliament.

May said that the U.K. government is "getting on" with the Brexit, following a High Court ruling that Parliament must vote on when the formal process of leaving the EU can get under way. However, the U.K. government argues that ministers already have sufficient powers - under the Royal Prerogative - to trigger the process without votes from MPs’ and their peers.  The government has vowed to fight to get the ruling overturned next month in the Supreme Court.

Nonetheless, just as Conservative Party MP Dominic Raab likens the issue to opening "Pandora's Box,”  markets are already considering the possibility of an early election following the High Court decision, which the Supreme Court could approve as well. May has already ordered government lawyers to appeal the decision to the Supreme Court which will be heard in the coming weeks.

But it is not clear whether the government will appeal the case to the European Court of Justice. If the government accepts the decision, MPs will get to vote on the timing of triggering Article 50, most likely before March.

"For some, the court ruling is a victory for parliamentary democracy. For others, unelected judges stand in the way of the U.K.’s withdrawal from the EU. If the Supreme Court gets the final say, “voters may still wonder whether their voice matters at all," Kenneth Armstrong, professor of European Law from Cambridge University said.

However, May seems determined to fight to the end to implement the Brexit despite the increasing implications of leaving the single Euro zone. Speaking to BBC on the way to New Delhi for a trade visit, May said the government had "strong arguments" in its appeal against the High Court's decision. She said, "The British people, the majority of the British people, voted to leave the European Union. The government is now getting on with that."

On the other hand, the prospect of early general elections are on the rise after the High Court ruled that the government cannot trigger Article 50 without parliamentary approval. According to the Telegraph, most Conservative MP’s are still backing May’s Brexit policy. However, the remainder of Tory MPs – likely being led by former Chancellor George Osborne and former Education Secretary Nicky Morgan - will most likely agree to back the triggering of Article 50 as long as they can get a say over a full plan for the Brexit - exactly what May does not want.


- What happens if early elections are called? 

According to some polls suggesting that a narrow majority of voters would now support remaining in the EU, May argues that this majority would not beat an overwhelming victory against Labor leader Jeremy Corbyn.

One way or another, markets are taking into account the possibility of early elections which might open the door for both new risks and opportunities for the U.K. economy in the long run.

07 Nov,2016