On 24 December 2020 the UK and EU agreed on a trade deal, removing the risks and uncertainty that would have come with a no-deal Brexit. Despite this, there’s no doubt that Brexit will still have an impact on individuals and business owners
This blog will outline the repercussions the newly agreed EU-UK Trade Agreement will have and how Rocket Lawyer can help you.
I am a UK national living in the EU or a EU national living in the UK. How can I prepare for Brexit?
Since 31 January 2020, the UK has been in a transition period to prepare for the consequences of Brexit. This transition period will end on 31 December 2020 and major changes are expected to take place for individuals across the UK and Europe.
My business imports goods from and/or exports goods to the EU. How can I prepare my business for Brexit?
The trade deal allows a zero tariff and zero quota trade in goods, meaning that the UK and EU will receive preferential access to each other’s markets and will not have to trade with each other under World Trade Organization (WTO) rules.
However, UK businesses importing goods to the EU might still face supply chain disruptions because they will have to carry out customs declarations.
To prevent disruption to your supply chain, it may be beneficial to draw up a Business continuity plan. This should outline your emergency plans to keep your business operational in case of disruptions.
Where your business has agreed to commercial contracts with EU-based suppliers, you may need to amend or cancel these contracts to avoid Brexit-related disruption.
If you need legal advice on how to mitigate the impact of supply chain disruption to your business, Ask a lawyer.
Certain goods require a conformity mark (also known as a certificate mark) to prove that they comply with the accepted product standards. From 1 January 2021, instead of using the CE mark to demonstrate compliance, goods that were previously sold under the CE mark will require a new conformity mark to be sold in the UK, called the UKCA mark.
My business supplies services across the border. How can I prepare my business for Brexit?
UK businesses no longer have guaranteed access to the EU single market and therefore certain professional qualifications will no longer be automatically recognised by the EU. UK citizens supplying any services to the EU will have to apply to individual member states to try and get their qualifications accepted.
As the UK will no longer be a part of the EU’s integrated services market UK regulations may begin to diverge from the EU standards, increasing obstacles to the provision of cross border services.
If your business provides services to the EU, you may want to draw up a Business continuity plan to set out your recovery procedure in the event of Brexit-related disruption.
My business owns IP rights. How can I prepare my business for Brexit?
The impact of Brexit on intellectual property rights for EU and UK based businesses varies according to the type of intellectual property right. The UK government has recommended that companies carry out an IP audit to determine their dependence on IP protection in the UK and the associated risks of losing such protection.
The Withdrawal Agreement sets out the various changes that will take effect at the end of the transition period in 2021 for each IP right.
This is a complex area of law so if you have any questions regarding the impact of Brexit on your intellectual property you should Ask a lawyer.
My business handles personal data. How can I prepare my business for Brexit?
The General Data Protection Regulations (GDPR) have been retained in UK law and will continue to be read alongside the Data Protection Act (DPA) as before. The EU will need to make an ‘adequacy decision’ on the standard of safety that UK data protection laws provide. This will determine whether the UK’s data protection regime meets the standards set out under the GDPR.
The new trade deal has confirmed that personal data can continue to flow freely from the EU (and EEA) to the UK, until an adequacy decision has been made, up to a maximum of six months.
Note that international transfers of personal data outside the European Economic Area are prohibited unless certain safeguards are in place. Therefore, as a business, you must properly handle the personal information given to you by individuals.
Brexit will impact how I compete with other businesses. How can I prepare my business?
The trade deal between the UK and EU has introduced a level playing field to guarantee fair competition. This means that both the UK and EU are able to take action against each other if they believe one has gained an unfair competitive advantage over the other. For example, if the UK is seen to undermine EU trade rules the EU could retaliate by imposing tariffs on UK exports.
From 2021 onwards, the Competition and Markets Authority (CMA) in the UK will take over from the European Commission (EC) in enforcing competition law. Find out more about competition law in the UK.
As an employer, how will Brexit affect my business?
The majority of employment law in the UK comes from regulations set out by the EU. As a member of the EU, the rights and responsibilities of employees and employers were largely consistent across all EU countries, facilitating the employment of individuals in other EU countries.
In 2021, at the end of the Brexit transition period, UK employment law may begin to diverge from EU employment law. This could present new challenges to businesses that employ EU nationals in the UK or UK nationals in the EU.
If you are concerned about the implications of Brexit on your employees, you may wish to amend the terms of their employment contract to account for Brexit-related disruption. Read more about work permits and employing overseas workers.
On immigration issues, read on how Brexit may affect individuals.
Can I invoke a force majeure clause if my business is exposed to Brexit related disruption?
Force majeure is a specific clause that is often included in a commercial contract. It refers to situations where an agreement cannot be performed (eg the obligation to provide payment) because of circumstances outside the control of the parties. Where these circumstances arise, and prevent the contractual obligations from being fulfilled, the contract is temporarily suspended and can even be terminated if the circumstances do not change.
Brexit does not fall into any of the standard Force Majeure Events. So, it is important for businesses to specifically refer to Brexit-related disruption when drafting a force majeure clause. If Brexit is not mentioned, it is unlikely that a business can rely on their force majeure clause to suspend their contractual obligations.
Use a Force majeure letter to terminate a contract by relying on the ‘Force Majeure’ clause in your contract if a contract is impossible to fulfil.
Get specific advice on your situation by having your contracts reviewed to see if you can cancel it for reason of force majeure.
Have our lawyers draft a bespoke document specifically for you and your situation.