Crucial weeks ahead as Europe leaders seek to ‘tick off boxes’

Bloomberg

As summer draws to a close, the European Union will seek to tick off a number of boxes from the top of its to-do list, leveraging its new-found political capital following the ascent of pro-EU leaders on the continent.
Brussels will have its hands full as negotiations ramp up with the UK on its impending exit from the 28-nation bloc, with some eastern European countries testing the boundaries of anti-democratic initiatives and the euro area still working on reforms to protect its economic well-being. Here are the main topics to look out for in the coming months.

BREXIT TALKS
The UK and EU have three more rounds of negotiations on Britain’s departure from the bloc before a summit in October. It’s at that gathering in Brussels that leaders are supposed to give approval for the start of phase two of the talks — dealing with how the relationship between the two sides will look once the UK has left in March 2019.
But there’s already doubt about whether there will be sufficient progress by then on phase one — how the UK will protect rights of EU citizens and Britain’s financial obligations to the EU — to allow that to happen as scheduled. And if timing is delayed, it raises the prospects of the UK slipping out of the EU without a deal, which would mean no foundation for a future trade agreement and no transitional period to soften the blow, something that neither side wants.
That makes the next few weeks crucial. The British government will publish documents setting out its positions on various issues as negotiators on both sides try to agree on complicated topics such as the border between Northern Ireland and the Republic of Ireland and the role of the European Court of Justice in post-Brexit Britain.
If Prime Minister Theresa May, under pressure at home and due to face members of her Conservative Party at its annual conference in the first four days of October, can leave the EU summit on Oct. 19-20 having won approval for the start of trade discussions, it will be a sign that Brexit negotiations are on course. But it’s a very big if.

RULE OF LAW
In the coming months, Poland is facing the threat of unprecedented EU penalties from the first-ever probe of a member’s respect for the rule of law. The European Commission said last month there was excessive political influence over the legal system in Poland and launched action against the country for violating EU law in a process that could see the EU suspending its voting rights. The European Commission sent Warsaw a “letter of formal notice” in July, giving the government one month to reply. The next step in the infringement process would involve a final warning by the commission to the Polish government in the form of a “reasoned opinion,” after which a lawsuit could be filed.
The battle between EU regulators and the Polish government over its plans to weaken the judiciary’s independence underscores the emergence of a new fault
line between eastern and western Europe and comes as scrutiny
of democratic standards within the EU has moved up the bloc’s agenda. The government in
Warsaw is at the sharp end of a campaign to rein in errant states, as populist leaders in Poland
and Hungary have been emboldened by Donald Trump’s US
presidency and Britain’s decision to quit the EU.
The spat is unlikely to be resolved soon, and could become a key issue between the EU and some of its members in coming months as the bloc tries to balance sensitive Brexit negotiations.

REFORM OF THE EURO AREA
Discussions over how to reboot the euro have already started taking place in recent months, having been given fresh impetus by the election of Emmanuel Macron in France, a staunch advocate of further integration. While there is no consensus yet among the currency bloc’s 19 members on if and how the euro area should get its own finance minister, budget or a regional Monetary Fund, talks are expected to pick up steam after the German election in September.
The EU’s biggest economy has so far resisted calls for further fiscal integration, but Chancellor Angela Merkel has signaled her willingness to discuss some of these issues in the future.