Brexit and its consequences for you

On 23 June 2016, the British people voted in a referendum for withdrawal from the European Union. On 29 March 2017, the United Kingdom formally announced that it wanted to leave the EU, the so-called Article 50 declaration, meaning that on 29 March 2019 the United Kingdom will no longer form part of the EU.

The position of the United Kingdom within the EU

The United Kingdom has always had a special position within the EU. The United Kingdom and Ireland have stipulated a so-called 'opt-in', meaning that the United Kingdom and Ireland in principle do not take part in the adoption of EU legislation and regulations, unless within three months of a proposal for legislation they notify the Council that they wish to take part in the legislation. As a result, the United Kingdom can decide independently whether or not it wants to apply certain EU legislation and regulations within the United Kingdom.

What does this mean for you?

(This page will be updated on a regular basis if there are new developments in the Brexit process)

Private Persons

Private persons

As a result of the growing number of international families – an estimated 16 million – there has been an increase in cross-border disputes about (family-)law issues in the EU, with Brexit as an extra complicating factor. The number of international divorces in the EU amounts currently to around 140,000 per year. The number of children born from relationships between unmarried parents with different nationalities has also increased. Furthermore, every year there are around 1800 cases of child abduction in the EU¹.

 

¹The proposed new rules of the Brussels IIa Regulation: Questions & Answers, Persbericht Europese Commissie van 30 juni 2016, MEMO/16/2359, Brussel.

 

Companies

In June 2016, the Netherlands Bureau for Economic Policy Analysis (CPB) has done research into a number of different forms of a new relationship between the United Kingdom and the European Union. The outcome was that Brexit will cost the Netherlands billions in euros due to less trade with the United Kingdom. Many studies show that a Brexit will have a negative effect on the British economy.                              

In 2015, the Netherlands exported for over € 52 billion to the United Kingdom and the earnings of this export amounted to over € 20 billion. This means that the United Kingdom, together with Germany, is the most important export destination for the Netherlands.

Nothing will change for the time being …

In the short term, as long as the negotiations between the United Kingdom and the European Union are still being held, nothing will change for citizens and companies in the United Kingdom and the other EU Member States.

In so far as the United Kingdom takes part in the EU legislation and regulations via the so-called opt-in procedure, the legislation and regulations will apply and citizens and companies can continue to rely thereon. The United Kingdom is still a full member of the European Union and will in any case remain so until 29 March 2019 – two years after the United Kingdom has announced that it wants to leave the EU – or until such another date if the United Kingdom and the EU have concluded an agreement about the withdrawal from the EU, the so-called Article 50 procedure. As time progresses it seems to become ever more improbable that such an agreement will be concluded before 29 March 2019.

Brexit will not have any consequences as regards the EU regulations in which the United Kingdom does not take part and as regards the conventions and treaties which the United Kingdom has concluded independently. The EU regulations had no binding force in the United Kingdom and in so far as the United Kingdom had the competence to conclude conventions and treaties independently, Brexit will not change that competence.

Transition period (29 March 2019 until ???)

It seems to become ever more improbable that the United Kingdom and the EU will succeed in concluding a comprehensive regulation about the withdrawal of the United Kingdom. There is a growing body of opinion both within the United Kingdom and within the EU saying that it is advisable to agree on a transition period as long as the negotiations have not been finalized and the implementation of the withdrawal agreement has not been completed. In doing so, Brexit should have a “soft landing”. Whether this will actually happen, is unclear. Article 50(3) of the EU only provides room for a negotiation period longer than two years if all the Member States unanimously decide to extend that 2-year period: the United Kingdom must agree to such a proposal to extend and the other Member States must subsequently decide positively and unanimously thereon.

What the judicial protection will look like during this transition period is guesswork, but a possible option might be that the status quo will continue to apply, on the understanding that the United Kingdom will no longer be a full EU Member State. However, this raises all kinds of questions. Is the United Kingdom still allowed to delegate a judge to the Court of Justice in Luxemburg? Is the United Kingdom still allowed to state its views in proceedings between an EU citizen and another Member State? And, broadly speaking, does the United Kingdom still have influence on revision of existing EU legislation or the development of new EU regulations?

Preliminary agreement of 8 December 2017 (phase 1)

On 8 December 2017, the negotiators of the EU and the United Kingdom reached a preliminary agreement about the first phase. In this agreement arrangements have been made about:

  • the protection of the rights of EU citizens in the United Kingdom and British citizens in the EU after Brexit
  • a framework for the special circumstances of the position of Northern Ireland.
  • the manner in which the financial settlement of Brexit will be calculated

It expressly concerns preliminary arrangements since these have been expressly agreed subject to the condition that 'nothing is agreed until everything is agreed'. So, the temporary arrangement may still be amended at a later stage. In the temporary arrangement of 8 December 2017, the negotiators of the United Kingdom and the EU have agreed that the current rights and obligations of British citizens in the EU and of EU citizens in the United Kingdom will be continued during eight years after the exit of the United Kingdom from the EU. In order to realize this arrangement, specific legislation will be introduced in the United Kingdom, the 'Withdrawal Agreement & Implementation Bill'.

As regards a uniform interpretation and explanation of EU regulations and the arrangements made concerning the rights of EU citizens in the United Kingdom and the rights of British citizens in the EU, respectively, it has been agreed that the European Court of Justice in Luxemburg as the highest court is competent to give    decisions during eight years after the exit of the UK from the EU. British courts can in that connection still refer questions to the European Court of Justice in Luxemburg for a preliminary ruling, and the Court of Justice can give a binding decision. In conclusion, in this connection it has also been agreed that a mechanism must be introduced by which the United Kingdom, even though it is no longer an EU Member State, still has the right to intervene in relevant matters pending before the European Court of Justice in Luxemburg and vice versa the European Commission   in matters pending before British courts.

The foregoing arrangement does not provide a final deal on security since the arrangement made only applies for eight years. The manner in which the rights of EU citizens in the United Kingdom and of British citizens in the EU will be safeguarded after the period of eight years has passed, as well as the uniform explanation of the regulations referred to hereinabove, has not been regulated and   is therefore uncertain. Moreover, the preliminary arrangements made are still to be worked out in greater detail in the Withdrawal Agreement, which will prove to be not so simple. For instance, much is still not clear with respect to the situation in Northern Ireland. Upholding of both the Good Friday Agreement of 10 April 1998 and by that an open border between Ireland and Northern Ireland does not go well together with holding on to an exit of Northern Ireland from the internal market and Customs Union.

After Brexit ...

In the EU Withdrawal Bill, the United Kingdom has proposed to convert the body of present EU legislation into national (British) law. A drawback of this intention is that this national law will only apply in the United Kingdom. Outside the United Kingdom it will not be possible to rely on this national law. And there will no longer be an obligation either of EU Member States to, for instance, automatically recognize British court decisions, all the more so because the same EU Withdrawal Bill expressly exclude that the European Court of Justice in Luxemburg as the highest court in Europe will be able to decide on disputes between citizens and companies from the United Kingdom and other EU Member States.

In other words, according to its own bill, the United Kingdom will be obliged to take over the EU law in its own legislation and to apply this law, to automatically recognize the judgments of the courts from the 27 EU Member States and to enforce these judgments, but that same obligation does not exist for the other 27 EU Member States. After all, this obligation is based on regulations which only apply in the United Kingdom and is not based on a treaty concluded with the EU. Moreover, in due course a difference will arise between EU law and the British “adopted EU law”, since that EU law will be subject to amendments, for instance revision as a consequence of the results and recommendations from the consultation and evaluation procedures about the effects of the EU regulations. Such a revision will no longer be implemented in British legislation on a one-to-one basis. In addition, new EU law will be introduced, which will not apply in the United Kingdom. This scenario will probably result in a deterioration of the international judicial protection of the citizens of the United Kingdom comparable to the no-deal scenario of a hard Brexit. It is evident that the British people will be placed in a worse position if (in the future) they have to rely on British rules.

The other scenario is the scenario of a hard Brexit, the so-called “no deal” scenario, particularly advocated by the hardliners of Brexit. In this scenario no exit arrangement is made between the United Kingdom and the 27 EU Member States, but the scope of application of any and all existing EU regulations will lose its effect on 29 March 2019, without being replaced by other regulations. In that case the United Kingdom will have to fall back on existing treaties and conventions to which it is already a party or it has to accede to treaties and conventions which can provide an alternative for the loss of EU regulations. EU legislation and regulations provide far-reaching cooperation between the EU Member States and protection to EU citizens, which are not simple to be replaced by, for instance, Hague Conventions. The (international) judicial protection of the citizens in the United Kingdom will be diminished in this situation with respect to the present situation. The right to free movement of persons and goods (the internal market) will no longer apply in relation to the United Kingdom.

The future must show what the real impact of Brexit will be for citizens and companies. In any case, it will become significantly more complicated. Parallel legal proceedings pending in the United Kingdom and in EU Member States appear on the horizon with a total lack of clarity and uncertainty for citizens and companies as a result. Disputes we had managed to reduce by implementing EU regulations.

 

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