The possibility of an “no-deal” exit of Britain from the European Union after April 12 is increasingly concrete. The events and political uncertainty of the last few months have changed the starting scenario, dating back to three years ago, making this eventuality ever more concrete. As will be recalled, the referendum of June 23, 2016 established the will of British citizens to leave the European Union 43 years after London joined the European Economic Community. In March 2017, the United Kingdom notified its intention to withdraw from the EU and activated the procedure provided for in Article 50 of the Treaty on European Union. After about a year and a half of negotiations, on November 25, 2018, an agreement was reached that provided for March 26, 2019 as the date for the “Brexit " and a transition period for the real withdrawal.
At this point only a further extension granted by the European Union or the unilateral revocation of article 50 by the United Kingdom - as sanctioned by the European Court of Justice in the sentence pronounced last December 18 - could prevent a hard exit, as a result of which the United Kingdom would become a third country with immediate effect, without a transitional regime. The European Commission, in strict agreement and collaboration with the Member States, prepared for this scenario by presenting a series of emergency measures and publishing notices on specific sectors to present the affected operators to the consequences of withdrawal without agreement.
Here are some aspects that would directly affect businesses:
- Customs : the United Kingdom will be subject to the EU rules imported and exported for goods from/to third countries, including customs duties and formalities;
- Sanitary and Phytosanitary Measures: the UK would be immediately inserted in the list of third countries authorized to allow entry into the Union of live animals and animal products coming from there, provided will have to ensure compliance with sanitary and phytosanitary requirements for imports from third countries;
- Fishing rights: compensatory measures are provided for fishermen and operators in the European Union under EFF, the European Fund for maritime affairs and fishing, for the temporary cessation of fishing operations. The Union can grant British ships access to EU waters until the end of 2019 provided European ships can access British territorial waters;
- State aid: the Community rules on state aid allow to address the criticalities of European companies, especially SMEs, in case of need for financial resources and technical assistance;
- Public procurement: EU law would no longer apply in the UK. According to EU law, the public procurement procedure is governed by the law in force at the time the procedure is started. British operators who present a bid in a contract of a Member State of the Union would be considered as operators of third States. Greater guarantees for European and British economic operators would derive from the accession of the United Kingdom to the Agreement on public procurement of the World Trade Organization;
- International agreements: they would cease to apply to the United Kingdom, but a distinction should be made between bilateral agreements and multilateral agreements. Existing bilateral ones would cease to produce effects, while new ones could be concluded if they do not cover the matters provided for in Article 3 of the Treaty on the Functioning of the Union on the exclusive competence of the European Union. As for multilateral agreements, such as those of the World Trade Organization, the United Kingdom will become a member on an individual basis: relations with the Member States of the European Union will be governed by international law;
- Professional qualifications: if a community citizen obtains a British professional qualification after withdrawal, the recognition procedures would be those applied to a third country. The same rule applies if a British citizen were to seek recognition in Europe of his professional qualifications. With regard to the provision of temporary or occasional services by a British citizen in the EU, recognition would be based on the legislation of the Member State concerned.
For further information, the following links are recommended:
European Commision - Preparation for Brexit
Ministry of Foreign Affairs and for International Cooperation - Dossier Brexit