Spain's veto of Gibraltar Brexit 'could be illegal'

Spain's effective veto over whether Brexit will apply to Gibraltar could be illegal and overturned by the European Court of Justice, the Daily Telegraph says.

An EU ruling earlier this year stated that any deal will not apply to the territory without an "agreement between the kingdom of Spain and the UK".

However, MEPs and legal experts say this effective "veto" would give Spain special status among EU nations, which are supposed to be equal.

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British officials were taken by surprise by the clause, which was laid out in the EU's Article 50 negotiating guidelines. A senior Whitehall figure told the Telegraph it was "absolutely unacceptable" and gave Madrid too much power over the future of Gibraltar. Others accused Spain of using Brexit to mount a "land grab" for the Rock.

In May, the Daily Mail said the Spanish government was planning to use its veto to tell Gibraltar how to run its economy.

Citing leaked documents from Spain's foreign ministry, the paper claimed Madrid wanted to end what it described as the Rock's "unjustified privileges", namely its low-tax status, and demand a "new accord" over flights into the territory.

Gibraltar's Chief Minister Fabian Picardo said the Rock had "cast-iron assurances" from Brexit Secretary David Davis it would not be excluded to secure a better post-Brexit trade deal and he would not accept any compromise with Madrid.

"The Spanish government's mask is slipping. It is becoming abundantly clear that they want to try to use Brexit to take narrow advantage," he told the Daily Telegraph in May.

Legal experts say the European Court of Justice could rule that the veto is in breach of EU law. A successful legal challenge "could hand British negotiators, who were wrong-footed by its inclusion, leverage in Brexit talks or help push back against Spanish sovereignty claims over The Rock", says the Telegraph, while also being "a major embarrassment for the EU, which has successfully presented an image of unity and organisation".

However, if the UK government does decide to challenge the vote in the courts, it would risk throwing the negotiating timetable further into disarray, as well as further sour relations with the rest of the EU.