Iain G Mitchell: Three key questions separatists must answer

THE supporters of independence assert that, following independence, Scotland will retain EU membership, sterling and UK banking regulations.

These are clearly policy objectives, open to negotiation, but would any of these consequences ensue automatically?

First, the issue of EU membership. The state which signed the Treaty of Accession was the United Kingdom. If the United Kingdom ceases to exist, then, in international law, the treaty obligations will pass to the successor state or states.

It is worth remembering that the state which is presently known as the United Kingdom of Great Britain and Northern Ireland, is, in fact, the result of two separate unions and a severance: first, the union in 1707 between England, Wales and Scotland; second, the union between Great Britain and Ireland a century later; and, third, the severance of the southern counties of Ireland in the 20th century. It is certainly arguable that the state which would be left after the withdrawal of Scotland, would still identifiably be that state, the United Kingdom. Thus, the UK will not be regarded as having ceased to exist, leaving Scotland as a new entity, which would have to apply to join in its own right.

Supporters of independence will point out that, even if Scotland will not automatically continue as a member of the EU, the EU would not be long in admitting Scotland it. That is not a question of law, but of political will. It cannot be certain that Scotland would be admitted (what price a veto from a member state concerned not to encourage its own national minorities?), but even if Scotland were to be admitted, there would be a likely period of delay in which, no doubt, a Scottish Government would seek to maintain its legislation in conformity with EU law, but Scots would be denied access to the EU institutions and the dispute resolution mechanisms (such as the Court of Justice) provided for in the treaties, Scotland would be unable to have a say in the formulation of new EU legislation and would have no MEPs.

Second, Sterling. It is not clear upon what basis Scotland could assert a legal right to use the pound Sterling as its own currency, though, like Ireland after independence, it might try to maintain parity between a Scottish pound and the pound Sterling. A Scottish Government may seek to negotiate a monetary union with the rest of the present United Kingdom, but as current experience with the Euro demonstrates, there are substantial problems in having monetary union without political union.

There are a host of problems involved in one country using another country’s currency, and it is inconceivable that independence negotiations would not focus on this.

Third, banking regulation. Here the advocates of independence may be on firmer ground. The present regulatory regime is enshrined in legislation affecting Scotland and, plainly, that legislation would continue to apply after independence, though it is likely that independence negotiations would focus upon practical questions of the desirability of ongoing regulation by United Kingdom regulatory bodies such as the Bank of England, as opposed to a new Scottish regulator.

However, the issue is not so much what happens on day one after independence as how the situation will develop. For example, if the Westminster Parliament changes banking regulations, it would be for the Scottish Parliament to decide whether it would wish to make similar changes. Further, separate courts and regulators might bring different interpretations to bear. In short, whatever the position on day one, the Scottish regulatory system may diverge from the system applying elsewhere in the present United Kingdom.

Indeed, much banking and financial regulation owes its origin to EU directives or regulations, which brings the argument neatly back to the initial question of continued EU membership.

• Iain G Mitchell QC is a member of the Murray Stable and a barrister at Tanfield Chambers in London. He was joint editor of the former Scottish Parliament Law Review.