At their EU summit in Brussels, European leaders congratulated their counterpart, Prime Minister Boris Johnson, and his Conservative Party on the outcome of the British parliamentary elections. According to their concluding statement, the EU is ready to move on to the next phase of the United Kingdom's exit from the EU. They have given negotiator Michel Barnier a mandate to begin negotiations with London on the withdrawal arrangement.
The European Union is now preparing for the next phase of Brexit: negotiations over a bilateral (trade) agreement, which must be completed by the end of 2020. This timeline is particularly challenging. "We will have to work as quickly as possible," said Commission President von der Leyen.
French President Emmanuel Macron wants rapid progress on settling the Brexit dossier. The British will leave the EU in a month and a half, and the British parliament will almost certainly not request another extension. This leaves Westminster very little time to pass the necessary legislation. This will mark the end of British EU membership on December 31, 2020, as stipulated in the withdrawal agreement.
Negotiations on a new relationship between the British and the EU will begin in February. These talks will be a challenging task. According to Dutch Prime Minister Mark Rutte, the Brexit dossier is far from concluded, and we are only halfway through. Commission President von der Leyen reiterated that a "level playing field" is of utmost importance so that the British and Europeans cannot engage in unfair competition against each other. But the agreement will have to cover more than just trade. It will also address education, fisheries... and many other issues, she said.
In British media commentary — now that Johnson has a very strong majority in the House of Commons — there is already consideration of a possible new type of extension: not about Brexit itself but about a new trade agreement. The EU has already indicated that a new treaty will not be completed within a year unless the British largely want to continue the existing agreements.
In the meantime, EU trade rules will continue to apply, but the British will no longer be allowed to vote on new EU legislation. The transition period will be used to negotiate a new economic relationship. That transition period can be extended, but this must be arranged in the coming months at the latest. It can be postponed for one or two years if London requests it before July 1.