Brexit Briefing - August 2019

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Jane Lambert

At the beginning of August 2019, the UK seemed to be on course to leave the European Union without a withdrawal agreement.  The government's official policy was to continue to negotiate (or at least to offer to negotiate) right up to 31 Oct 2019 but on terms that the European Commission and the remaining EU member states could never accept (see "Dear Donald" - Johnson's Letter to Tusk and Tusk's Response 19 Aug 2019 and Kitty Donaldson and others EU Says U.K. Has Failed to Deliver New Proposals: Brexit Update 4 Sept 2019 Bloomburg).  The thinking seemed to be that the EU would blink first and make concessions at the end of the day as is said to have happened.  If not, the blame for any economic dislocation arising from no deal could be pinned on the obduracy of the EU.  The election of a new leader had given the Conservative Party a boost in the polls which was reinforced by proposals for popular domestic measures and the support of four of Britain's biggest-selling newspapers.

Now the outlook is much less sure.   A bill requiring the Prime Minister to apply for yet another extension to the notice period provided by art 50 (3) of the Treaty on European Union has already passed through the House of Commons and is unlikely to be stopped in the Lords (see European Union (Withdrawal) (No. 6) Bill (HL Bill 202) Parliament website). The government lost its slender majority in the House of Commons when Dr Philip Lee MP ostentatiously crossed the floor while the Prime Minister was on his feet:

 
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It withdrew the whip from several of its leading MPs including senior ministers in Theresa May's administration and suffered resignations from several others including the Prime Minister's own brother as well as the leader of the Conservative Party in Scotland.  The Prime Minister's speech to cadets at the West Yorkshire Police training centre was unconfident and incoherent.

Why this reverse in political fortunes?   The wheels seemed to fall off the government's juggernaut on 28 Aug 2019 when the government advised the Queen to prorogue Parliament from the middle of September to the middle of October (see the Order in Council of 28 Aug 2019). Parliament is often prorogued at this time of the year for party conferences and the length of this year's prorogation is onlya few days longer than normal but its timing was perceived rightly or wrongly as a coup.  The result was demonstrations in support of Parliament from Lerwick in the North to Bodmin in the Southwest.

Those demonstrations were not large but they seem to have been significant.  Not only do they appear to have precipitated the Parliamentary defeats mentioned above but appeals to the public to side with the executive in implementing the referendum result appear so far to have landed on deaf ears.  The sight of the Leader of the House lolling about on the benches during an important debate did not go down well.  Neither did the delivery of a big girl's blouse to the leader of the opposition after he refused to vote for a general election before 31 Oct 2019.

These events in Parliament and elsewhere have caused sterling to rise on the currency markets but it is far too early to discount the possibility of a disorderly brexit. By a press release dated 4 Sept 2019 the Commission called on all EU citizens and businesses to prepare for the UK's withdrawal without a deal on 31 Oct 2019.  It has published detailed recommendations in its communication to the European institutions of 4 Sept 2019 Finalising preparations for the withdrawal of the United Kingdom from the EuropeanUnion on 1 November 2019  as well as a Brexit Preparedness Checklist.   

Three of the items on the checklist apply to intellectual property, contracts and data protection and are worth repeating here:

"Trademarks and designs, geographical indications, plant variety rights A unitary trademark and design35, as well as an EU system of geographical indications36 and EU-rules on plant variety rights37 ensure the protection of these intellectual property rights throughout the EU. Post-Brexit, the protection granted by these rights no longer applies to the UK territory.
Have I taken the necessary steps to ensure continued protection of my intellectual property rights in the UK?"

"Contracts – jurisdiction clauses
The recognition and enforcement by one Member State of judgements in civil and commercial matters handed down in another Member State is greatly facilitated by EU law38. Post-Brexit, the recognition and enforcement of UK judgements will be governed by the (national) rules for third country judgements.
Have I re-assessed a choice of UK jurisdiction in my commercial contracts"

"Personal data
EU law provides for the transmission of personal data across EU Member States without additional requirements39. Post-Brexit, the transmission of personal data from the EU to the UK is subject to the rules for data transfers to third countries. This is relevant for many business sectors, particularly if EU businesses continue to work with data-centres located in the UK.
Have I taken the necessary steps to ensure compliance with EU rules if I transfer personal data to the UK?" 

Anyone wishing to discuss this article or the preparations that need to be made for and after 31 Oct 2019 may call me on 020 7404 5252 during office hours or send me a message through my contact form.