The UK’s triggering of Article 50 on 29 March 2017 means that it will officially cease to be a member of the European Union on 30 March 2019. As this deadline approaches rapidly, there are a multitude of issues to be resolved and legislative tangles to be unscrambled. One such problem area that has received limited media coverage – relative to the Customs Union and the Single Market in general, at least – is that of air traffic rights. Continue Reading
More than a year has passed since the UK voted to withdraw from the European Union without much clarity ever given to businesses on what the terms of the intra-EU trade with the remaining EU27 would look like post-March 2019. This has led to many of our clients planning for the worst possible option, i.e. anticipating that at midnight on March 2019, the UK would formally have withdrawn from the EU without an arrangement in place.
However, on 15 August 2017 – a bank holiday for a large part of Europe − the UK government released its most-anticipated “Future customs arrangements paper”: the first of a series of papers setting out the UK government’s thinking on its future relationship with the EU.
We took advantage of a relatively calm week to propose a few thoughts, our immediate reactions to the key issues and questions arising out of the UK government’s strategy. As you will see, the debate is just beginning.
The government yesterday published its Rights of EU Citizens in the UK Policy Paper Factsheet for workers and employers together with detailed proposals setting out its offer to EU nationals currently resident in the UK and those proposing to enter for the purpose of residency, pre-Brexit. Although there is a fair amount of detail to flesh out the announcement made by Theresa May at the EU summit dinner last Thursday, and much depends on the outcome of current negotiations with the other 27 EU States, as indicated in our blog piece at the time, a number of questions remain unanswered. Here are the key points, with our commentary: Continue Reading
At a European council summit dinner last night, Theresa May outlined the UK’s offer to secure the rights of EU citizens in the UK. The key points have been reported as follow:
- EU citizens with 5 years’ residence in the UK before a cut-off point (expected to be no later than Brexit day) will be eligible for a ‘settled status’ category allowing the same rights to education, healthcare, pensions and benefits as other UK citizens.
- Those already in the UK with less than 5 years’ residence and who arrive lawfully before the cut-off point will be able to continue to reside in the UK to acquire their settled status. Details of a two year ‘grace period’ following the cut-off point remain unclear.
The offer is conditional on a reciprocal deal for 1.5 million British citizens living elsewhere in the EU.
The UK’s opening position is arguably a positive step towards an agreement in principle – Angela Merkel has described it as a ‘good start’. Nonetheless, the offer falls far short of the very clear proposals put forward by the EU Commission that EU nationals already in the UK and those arriving before we leave the EU should retain their current rights indefinitely. There is no mention of a continuing ability to be joined in the UK by non-EU family members and Theresa May has made it clear that any post-Brexit disputes over EU citizens’ rights would be resolved through the UK courts rather than the European Court of Justice.
Whilst the UK’s detailed written proposal on Monday will undoubtedly provide further detail, it needs to address the following questions as a minimum:
- What additional qualifying criteria beyond 5 years’ residence will apply to this new ‘settled status’?
- Will the onerous rules on documentation to evidence 5 years’ residence currently applied to EU citizens seeking confirmation of permanent residence in the UK be relaxed?
- In particular, will those who have spent any part of their 5 years in the UK studying or being financially self-sufficient still be required to demonstrate that they have held comprehensive sickness insurance during those periods?
- How long will it be before qualifying EU citizens are actually issued with this ‘settled’ status? Theresa May has referred to ‘streamlined administration’ and ‘light-touch’ registration but the administrative hurdles for putting a new system in place are significant, let alone the task of processing millions of applications which is way beyond the Home Office’s current resources.
- What will be the position of EU citizens who have already acquired permanent residence in the UK through 5 years’ continuous residence in a qualifying status? Should those who already qualify for permanent residence under current rules but do not yet have documentation to confirm their status still apply to the Home Office whilst waiting for the new system to be implemented?
The Prime Minister has emphasised that she does not want anyone already in the UK to be forced to leave or families to be split up but, without the finer detail to deal with these points, we are a long way off providing the certainty being sought by EU citizens and many will see this long awaited ‘guarantee’ as less than generous.
It is fair to say, this is not the result that many were expecting.
Theresa May’s Conservatives, who anticipated an increased number of seats throughout the General Election campaign, find themselves the largest party in Parliament, but without an overall majority. At the time of writing, it appears that the Conservatives have struck a non-formal deal with the Democratic Unionist Party (the largest Northern Irish party, which supports Brexit) to allow Theresa May to continue as prime minister in a minority government.
Even if the Conservatives had increased their majority materially, there was unlikely to be significant additional certainty about what Brexit meant. For a General Election ostensibly called because of Brexit, discussions were limited to which leader was trusted to deliver it, rather than what “it” would look like.
- Clash of Philosophies
There is a potentially irreconcilable clash of constitutional philosophies between the UK and the EU which results in certain “no go” areas on the EU side for the forthcoming Brexit negotiations.
- Perspective of the EU27
The EU27’s approach is driven by the perception that the European Union is not merely representative of a negotiable bundle of international trade treaties but is a supranational entity based on and subject to a constitution created by the Treaty on European Union (TEU) and the Treaty on the Functioning of the European Union (TFEU). From the perspective of the EU and the EU27 , the constitution of the EU goes well beyond international treaties. The Treaties establish a Union which is based on principles similar to those in Federal States.
Any of the member states of the EU (including the UK) accordingly is, from the perspective of the EU, not only a counterparty to an international treaty but an integral part of an autonomous Union. The driving principle of the European Union – which was correctly identified and repeated by Leave campaigners – is the supremacy of the EU’s legal order over the legal order of its member states, including the supremacy of the EU’s legal order over the constitutions of the member states.
One of the most important principles of the EU is laid down in Article 3 (2) TEU. This provides that the EU is an area within which its citizens are free and can freely move. This is a general principle which is not restricted to trade but applies in all areas of life. In addition to such general principle Article 3 (3) TEU states that, inter alia, one of the consequences of this area of freedom and free movement is the internal market.
On 19 April 2017, the day after the UK Prime Minister’s surprise General Election announcement, the Red Tape Initiative (RTI) was quietly launched in Westminster.
Established by Rt Hon Sir Oliver Letwin MP, who was in overall charge of the Cabinet Office until July 2016 and briefly head of the Brexit Unit after the Referendum, the RTI is a non-partisan project, bringing together “all three major UK-wide political parties to forge a consensus on the regulatory changes that could benefit both businesses and their employees in a post-Brexit Britain”.
Its advisory panel consists of leading Conservative, Liberal Democrat and Labour politicians – leavers and remainers – and it has a legal panel of eight lawyers, six of whom are QCs. We are pleased to be a member of that panel and Squire Patton Boggs will be providing pro bono legal assistance to the RTI.
The Prime Minister of the UK has unexpectedly announced that she intends to hold a General Election on 8 June.
Theresa May had repeatedly denied that she had intended to do so. She announced that she had changed her mind “recently and reluctantly” because “the country is coming together but Westminster is not”.
Triggering a General Election is no longer entirely straightforward as a matter of law. Before the 2010 election, a Prime Minister was free to call an election on demand, although under the British constitution, the ability to do so technically fell under the prerogative power of Her Majesty the Queen.
If a couple had conceived on the evening of the Brexit referendum, there is a reasonable chance that the baby would be born on 29 March, the date on which the Prime Minister will finally trigger Article 50 and send notice to the European Council. The Brexit gestation period from 23 June 2016 has not always been pleasant, and for many in the UK has led to spells of nausea.
At the risk of repeating a trite point, the act of triggering Article 50 does not cause significant changes in the legal relationship between the UK and the EU. The UK is still bound by EU law up to and until the date of its departure at the end of March 2019, unless all 28 countries agree otherwise.
In a recent interview with Tax Analysts, Pascal Saint-Amans, director of the OECD’s Centre for Tax Policy and Administration, was asked how concerned he was that the UK will end up going the tax haven route following withdrawal from the EU. He said:
“The U.K. wants companies to pay taxes — not much tax, because they want to be very competitive, and they have a very competitive system. Now, can they go much further in [terms of] competitiveness? Yes, they may cut their taxes a bit more, but there’s not much room [that] would drive dramatic change. The margin for slashing taxes is very limited because their taxes are already pretty low.”
So, not that concerned it would seem.