The UK government released a tranche of 28 documents on Thursday assessing the potential impact of a no-deal Brexit on a wide range of UK sectors and activities. Each of the papers has been examined by FT reporters. They are listed below under their original titles.
Applying for EU-funded programmes
Connecting Europe Facility energy funding
Organisations currently receiving EU infrastructure funding under the “Connecting Europe Facility” — which supports transport, energy and digital services projects — will continue to receive grants. The UK government will underwrite any pre-existing EU commitments. The programme currently supports a number of natural gas, electricity and oil transportation networks in the UK.
European Regional Development Funding
If a no-deal Brexit transpires, projects set to be funded by the European Regional Development Fund up to 2023 will lose their funding. The UK government has guaranteed that all projects that were agreed and set to be funded by the EU in the 2014-20 budget period will receive equivalent funding from the UK Treasury.
European Social Fund (ESF) grants
To avoid the sudden loss of funding to projects due to be supported by the European Social Fund, the UK government has guaranteed any projects that were set to receive EU funds in the 2014-20 budget period will continue to receive the money from the Treasury. The effect of a no-deal Brexit on these projects should be limited.
Funding for UK LIFE projects if there’s no Brexit deal
UK groups due to receive EU grants from the LIFE fund — which supports environmental, nature conservation and climate action projects — will still receive funding in case of a no-deal Brexit, with the payments coming from UK government via Defra and the devolved administrations. The government said it would ensure “an uninterrupted flow of funding to these projects until they finish”.
Driving in the EU
UK driving licences would no longer be valid in Europe after a no-deal Brexit, with anyone wanting to drive their vehicle or hire a car forced to apply for an International Driving Permit from the Post Office.
Motorists will be “turned away at the border” or face fines if not carrying the correct documents while trying to drive in the EU.
Two types of IDP stem from separate international conventions — one that lasts for one year, and another for three. Motorists entering certain countries, such as France and Spain, would need both, a further complication compared to the current system.
Handling civil legal cases
Handling civil legal cases that involve EU countries
In the event of a no-deal Brexit, the UK would drop out of most of the civil judicial co-operation rules applicable to EU member states, although some of those rules derive from international agreements.
In cross-border disputes where the UK reverts to its national laws, matters could become complicated. However, these issues have been raised repeatedly by both Brussels and UK bodies, and businesses and their legal advisers have been making contingency plans.
On family law, however, the government’s no-deal plans create far more problems.
Toby Hales, a partner at the law firm Seddons, called the government’s proposals “the worst possible outcome because it creates uncertainty — and when dealing with family law certainty is what you need”.
Replacing existing EU regulations in areas such as divorce proceedings, maintenance, child arrangements and child abduction with various Hague conventions would make enforceability much more problematic, he added.
“There are considerable numbers of people with regulating arrangements about their children across EU states that are court-enforceable. Those people could now be plunged into complex international litigation in ways they weren’t before.”
Labelling products and making them safe
Appointing nominated persons to your business
Nominated persons are authorised representatives of manufacturers for certain goods who have responsibilities including holding technical documentation or ensuring that health and safety standards are met. The EU is clear that any UK-based nominated person will no longer be recognised under EU law if the UK leaves without an agreement.
Nominated persons in EU countries will still be recognised in the UK for a limited period (with the exception of cosmetics) but will then need to be UK-based.
Travelling with a European Firearms Pass
The European Firearms Pass will no longer work for travel to the UK. UK residents who want to travel to EU countries with a firearm or shotgun are advised to “contact the authorities of the countries concerned for information about their licensing requirements”.
Trading under the mutual recognition principle
Some goods are traded in the single market on the basis of mutual recognition of national regulations rather than EU-wide product standards. Bicycles, furniture, cooking utensils and textiles fall into this category and a no-deal Brexit will have a significant effect on companies such as Brompton, the London-based bicycle maker.
After a no-deal Brexit, such a company would have to meet the domestic regulations for bicycles in each individual EU country because the mutual recognition of standards would no longer apply. A UK-compliant bicycle could no longer be sold in France unless it met French standards, for example. For manufactured goods where the mutual recognition principle applies, a no-deal Brexit would substantially increase the number of variations that were needed to be produced and complicate the logistics of manufacturing.
Trading goods regulated under the ‘New Approach’
Goods regulated under the new approach tend to be items such as toys, which are not especially sensitive and currently display a CE mark if manufacturers certify they conform with international standards. The UK plans to replicate this procedure with a new UK mark of approval and, over time, the regulations might differ.
At first, however, the implications are limited because the UK will recognise the existing CE mark of product conformity for what is described as a “limited time”.
Vehicle type approval
The choice of vehicles on sale in the UK may fall if there is a no-deal Brexit. Currently, cars approved by the Vehicle Certification Agency, the UK regulator, can be sold across the EU, while cars approved by an authority in an EU country, such as Germany’s KBA, can be sold in Britain.
Car manufacturers are not tied to their local authority, and are free to choose any approval agency across the bloc. But manufacturers whose cars are registered outside the UK will need to obtain fresh certificates if the UK leaves without a deal — leading to a potential backlog as the VCA issues fresh certificates.
The agency has already begun compiling existing European certificates from manufacturers, ready to convert them to new UK approval documents, and several carmakers that use the VCA are already moving to EU rivals so they can carry on selling in Europe.
Meeting business regulations
Accessing public sector contracts
Without a deal, the UK would no longer be able or required to publish public sector contracts on the Official Journal of the EU via Tenders Electronic Daily (TED). Britain would need to establish its own procurement database which would be used by the public sector to assess tenders from Brexit day onward. UK suppliers might not be able to bid for EU contracts in future if they did not qualify. This is of limited significance so long as the UK database is established quickly.
Broadcasting and video on demand
The government has told broadcasters that they must confirm whether channels broadcast from London have the appropriate licences for markets within the EU.
An exodus of media companies and jobs is feared because London-based broadcasters, including Disney and Discovery, who transmit 1,400 channels across Europe, will no longer be permitted to broadcast to some locations.
Broadcasters would need two licences to continue transmitting to those countries, and jurisdiction for regulation of content would likely go to either France or Luxembourg, where satellite feeds are received.
Bectu, the union, said it was disappointed at the level of clarity from the government in its report. “Rather than adding any new detail the paper just confirms what many broadcasters already know,” it said.
Merger review and anti-competitive activity
The paper reiterates the increased role for the UK’s Competition and Markets Authority, which after Brexit will take on the biggest cases that have previously been dealt with by the European Commission.
“Brexit is going to make a significant difference to competition law in the UK whether it’s hard or soft,” said Brian Sher, co-head of competition law at the law firm CMS.
“Both on anti-competitive practices and merger control, we’re going to see a repatriation of work for the CMA. But the difference as to whether it’s deal or no deal is not huge.”
What telecoms businesses should do
The regulatory framework by which Britain’s telecoms companies are governed needs to be updated to remove notifications to the Commission and other technical points. This will have little impact for regulation of the industry although Sharon White , Ofcom’s chief executive, has called for more powers to be given to the communications regulator after Brexit.
Personal data and consumer rights
The government has already taken steps to ensure its data protection regime is aligned as closely as possible with the EU’s by passing the Data Protection Act 2018. However, the UK wants an “adequacy decision” from Brussels that would rate the UK’s level of personal data protection as essentially equivalent to that of the EU — and that will not be forthcoming until after the UK leaves the bloc.
To deal with any gap, UK companies receiving personal data from their EU counterparts could use “standard contractual clauses”. These allow personal data to flow between businesses that pledge to uphold certain data protection standards. Large organisations with international operations beyond the EU use these clauses as a matter of course. However, for SMEs they are likely to be complicated and time-consuming, potentially needing the services of a lawyer.
Protecting the environment
Industrial emissions standards (‘best available techniques’)
EU emissions standards will continue to apply after Brexit, with the existing model being transferred into UK legislation, as demanded by industry.
Reporting CO2 emissions for new cars and vans
Car manufacturers that report CO2 emissions across Europe will be forced to detach their UK emissions after Brexit, and will be subject to separate CO2 targets in Britain. The government will be able to levy penalties on groups that breach limits.
However, cars sold in Britain will no longer count towards manufacturers’ EU CO2 totals that come into force after 2020. This will potentially hamper their appetite in the UK to sell electric cars , which help bring down CO2, following Brexit.
Upholding environmental standards
All existing EU environmental regulations will continue to operate under UK law, with powers from EU institutions transferred to their UK equivalents.
But the government will “over time and with parliamentary scrutiny” change them, and while it said its goal is to deliver a “green Brexit” that goes beyond European environmental targets, this is not enshrined in law.
“There is not much in here that suggests a divergence away from the promised direction of travel set by the prime minister in January,” said Doug Parr, chief scientist for Greenpeace UK. “[But] the devil is in the detail. Unless these things are enshrined in primary legislation, how much can you trust things that just appear in political notes as a statement of intent?”
Using and trading in fluorinated gases and ozone depleting substances
The UK would maintain EU standards and set up new IT systems which would be administered by the Environment Agency. Reporting requirements for businesses would not change. Businesses that produce, import or export HFCS would need to apply for a UK quota to place them on the UK market. They would use the new UK systems to report on their use of ODS and F-gases.
Running an oil or gas business
The UK will reduce the level of its emergency oil stocks, reducing the requirement for the amount of crude, petrol and diesel that oil companies and refineries must be able to access at short notice.
This will bring it in line with International Energy Agency standards, which requires countries to hold oil stocks equivalent to 90 days of net imports. This would put the UK on the same level as countries such as Australia. The EU currently requires members to hold either 90 days of net imports or 61 days of average inland consumption, whichever is higher.
Regulating medicines and medical equipment
Trading in drug precursors
Drug precursors are the chemicals used in a wide variety of industrial processes, such as medicines, flavourings and fragrances. Under a no-deal Brexit, companies would need the same licences and registration to trade with the EU as they currently need to trade with non-EU countries.
The Association of the British Pharmaceutical Industry said some of the chemicals covered by the notice “will already come from non-EU countries — so the appropriate authorisations are already in place”. But it added: “This is one more example of why we want a deal — any unnecessary complication of trading practices between the UK and EU is in no-one’s interest.”
Satellites and space
Satellites and space programmes
The papers confirm that UK-based companies and academics will be excluded from the future development of the EU’s Galileo space project if a hard Brexit occurs. They also show that companies currently involved in Galileo may face difficulties carrying out and completing existing contracts.
Under EU rules, non-member states cannot be involved in developing Galileo’s secure public regulated service, an encrypted navigation system for government users. Despite being instrumental in developing Galileo, British companies are now being blocked from bidding for contracts unless they pledge to move all their work to EU member states from March 29.
The UK space industry will also be excluded from the Copernicus earth observation programme, which supplies information to scientists, climate change researchers and emergency rescue teams. The government is seeking clarity from the EU about the status of UK-based Copernicus contracts.
Getting an exemption from maritime security notifications
UK ships will have to provide maritime security notifications to enter EU ports that include details such as the last 10 ports of call, the ship’s special security measures, and crew and passenger lists. The UK government will still issue exemptions from these requirements to scheduled services from an EU port to the UK.
Recognition of seafarer certificates of competency
Existing seafarer certificates will be valid, but after Brexit new certificates issued by the UK will need to be assessed by the Commission.
Travelling between the UK and the EU
The UK government has warned that it cannot “guarantee” surcharge-free use of mobile phones when travelling in the EU because rules that abolished roaming would fall away in the event of a no-deal Brexit. A new roaming cap of £45 a month has been proposed for UK citizens to replace the €50 limit that exists under EU law.
Roaming has concerned the telecoms industry since the Brexit vote because British operators feared they could be vulnerable to EU rivals ramping up the wholesale cost of their customers roaming on their networks. However, the UK’s four largest mobile phone companies, most of which are part of larger companies with operations across Europe, are confident that they will not have to reintroduce roaming tariffs.
The prospect of “inadvertent roaming” returned, however, when the government warned that some Northern Irish citizens may find themselves connecting to stronger networks in the Republic of Ireland.
Travelling in the Common Travel Area
Irish citizens could continue to come to the UK; and their rights would be the same.
Travelling to the EU with a UK passport
The government recommends that the passport of anyone travelling to the Schengen area after March 2019 should have at least 6 months’ validity and be less than 9 years old. This could lead to a lot of passport renewals.
For non-Shengen EU countries, UK citizens will “need to check the entry requirements for the country you’re travelling to before you travel.”
Reporting by Nic Fildes, Chris Giles, Myles McCormick, David Sheppard, Sylvia Pfeifer, Henry Mance, James Blitz, Sarah Neville and Josh Spero
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