Why Data May Prove One of The Hardest Parts of Brexit

Listen to PodcastPersonal data and its transfer over international boundaries hit the news in July 2020, yet again, as the Court of Justice of the EU (CJEU) handed down the Schrems II decision on data transfers reaffirming its strong backing for data protection rights.  In October, a CJEU ruling on UK (as well as French and Belgian) government surveillance regimes further shaped how policy-makers need to evaluate data protection arrangements.  Now Brexit is on the horizon and the international transfer issues surrounding the UK’s exit are becoming a pressing concern for many organisations.

But it remains unclear whether personal data transfers from the EEA to the UK will be able to continue as seamlessly as now post the Brexit transition period without additional measures. Unless the European Commission passes an “adequacy decision” in relation to the UK before 31 December 2020 (or some other form of agreement is reached), then EU/EEA organisations that transfer personal data to UK organisations (or allow them to access the data) will breach the GDPR unless they put additional alternative measures in place to govern those transfers, or a derogation applies. The Commission’s freedom of manoeuvre is constrained by the two CJEU rulings earlier this year.

For any organisation doing business across the Brexit border, there may be significant work to be done to ensure that those data transfers can continue without breaching the GDPR, such as putting EU Standard Contractual Clauses (SCCs) or Binding Corporate Rules into place.

I was recently joined by Neil Ross, Policy Manager for Digital Economy at techUK and Rosa Barcelo, co-chair of our global Data Privacy & Cybersecurity Practice and former Deputy Head of Unit of the Cybersecurity and Digital Privacy Unit of DG CONNECT in the European Commission to explore these issues on our Now & Next podcast

Brexit: UK VAT – No Relief for Cross-border Sellers

VATThe UK will leave the EU VAT area at the end of the Transition period on 31 December 2020. From 1 January 2021, there will be fundamental changes to the VAT treatment of goods arriving into Great Britain.

The changes are intended to ensure that goods imported from EU and non-EU countries are all treated in the same way and that UK producers are not disadvantaged. However, the change means that any business that imports goods from the EU will be significantly impacted.

Robert O’Hare and Tim Jarvis look at the basics and highlight, in particular, some of the implications for direct sellers and online marketplaces (OMP).

UK Freeports – The Tax Angle

On Wednesday 7 October 2020, the UK government published the Response document to the Freeports Consultation that was originally launched in February 2020. With the UK simultaneously negotiating multiple new free trade agreements, freeports could make a significant contribution to making the UK’s post-Brexit economic and trade policy truly global.

The creation of freeports is a flagship policy for the UK government. It touches on so many of the government’s core aims and objectives. At this stage we do not have all the details, however Tim Jarvis and Robert O’Hare look at what we know today from a tax angle and the next steps for freeports.

The UK’s New Points-based Immigration System: Where Are We Now?

Brexit - What Next?

The government has issued updated guidance for employers on the UK’s points-based system, which will apply to new applicants from the EU, the EEA and Switzerland (excluding Ireland), as well as those from outside the EU, from January 2021. Unfortunately, the updated guidance does not tell us much more than we already knew from the July 2020 policy statement – employers are still waiting for the finer detail of the scheme in the form of comprehensive policy guidance and changes to the Immigration Rules. In the meantime, what do we know so far? What do the changes to the points-based system mean in practice and how should employers prepare?

Annabel Mace and Supinder Sian look at what this means in practice and how affected companies should prepare. You can also sign up for our 12 October 2020 event on this topic here.

How Will Changes To The Chemical Regulation EU REACH Affect Your Compliance Obligations In The UK and EU After The Transition Period?

Barrrels in a factory.

At the end of the transitional period, on 31 December 2020, the chemical regulation EU REACH will cease to apply in the UK. This will automatically invalidate EU REACH registrations and authorisations held by UK companies. A stand-alone UK chemical regulation UK REACH will replace EU REACH in the UK.

Anita Lloyd and Dave Gordon look at what this means in practice and how affected companies should prepare.

Brexit and Subsidies Control

Brexit JigsawEU state aid law is a cornerstone of EU competition law and policy. It helps preserve a level playing field between companies competing in the internal market. Crucially, it operates only within the EU. Thus, EU state aid rules do not apply to financial support granted by non-EU authorities to companies in the EU, or to companies outside the EU but with activities in the EU. The exception to this rule is the UK, but not for long.

The UK exited the EU membership earlier this year, subject to a transition period ending on 1 January 2021. During this transition period, the UK remains subject to EU state aid rules. Even after the end of the transition period, as things currently stand, the UK could continue to be subject to EU state aid rules:

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Brexit – A Huge Change Coming

Having formally left the EU on 31 January, we are now into the home straight of the next lap of the Brexit process: defining the new relationship with the EU.

Things are getting heated.  Both sides are accusing the other of bad faith, and the UK Government is threatening to pass controversial legislation which would give it power to over-ride elements of the deal already done – the Withdrawal Agreement (an international treaty entered into by the Government less than a year ago).

Negotiations resumed on 28 September.  Many issues remain to be resolved, but two key stumbling blocks remain: how far the UK’s state aid policy might diverge from the EU, and the extent to which the UK will allow the EU fishing fleet access to UK waters.

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Off to a Bumpy Start

Houses of Parliament

In the last week of February – amid some chest-beating ferocity on both sides – the EU and UK published their respective negotiating mandates for the negotiations on the future relationship between the UK and the EU, which duly started at the beginning of March. On the day those talks started, the UK published its negotiating mandate for UK-US free trade talks (the US mandate has been available for over a year). And just to round the day off, US Trade Representative made a speech to the Oxford Union. So where does this flurry of activity leave us?

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Getting Brexit Done

Brexit Tearing of Flags“They think it’s all over”

The UK formally left the EU at 11pm GMT on Friday 31st January.  In keeping with his election slogan “get Brexit done”, Prime Minister Boris Johnson has banned the word Brexit from the Government lexicon.  Brexit Secretary Stephen Barclay resigned at 11pm that evening, and his Ministry was disbanded.  Job done.

Well, not quite.  The future relationship between the UK and the EU remains largely undefined, beyond some high level aspirations set out in the Political Declaration accompanying the Withdrawal Agreement.  Those include a zero tariff zero quota free trade arrangement, preservation of the EU’s Single Market and its “four freedoms”, respect for the UK’s ability to pursue an independent trade policy, and some ambiguous (see below) wording about ensuring fair competition.

Negotiations to reach an agreement to fulfil those aspirations will take place through the coming year, during which the UK’s relationship with the EU remains essentially unchanged (though the UK has ceased to play any part in EU decision-taking).  This “implementation period” (actually a negotiating period) can be extended by mutual agreement for up to two years.  Any such extension must be decided by the end of June.  A number of EU leaders and some commentators and business representatives on the UK side have said that extension will be necessary for any meaningful Free Trade Agreement to be concluded and ratified, and to allow business time to prepare.  But the UK Government has been adamant that the “implementation period” will not be extended beyond 31st December 2020, and has indeed legislated to that effect.

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Brexit Unblocked

One election, two winners, three losers

The United Kingdom went to the polls in a general election on 12th December – the first winter election for almost a century.  Boris Johnson’s Conservatives campaigned on a strong “Get Brexit Done” slogan, against most other parties arguing for a second referendum or to stop Brexit altogether (Nigel Farage’s Brexit Party in contrast were arguing that Johnson’s deal was not really Brexit).  Johnson’s Conservatives won 47 seats to give a substantial majority of 76, the Tories’ best result since Margaret Thatcher’s heyday in 1987.  Nicola Sturgeon’s SNP took 48 of Scotland’s 59 seats, reducing Labour to just one seat in Scotland.  Jeremy Corbyn’s Labour Party lost 59 seats, including many which had not voted Tory for many decades if ever, taking the Party to its worst result since 1935:  only in London and some big cities did the Labour Party perform relatively well.  Jo Swinson’s Liberal Democrats failed to make any headway, and Swinson herself lost her seat.  And Farage’s Brexit Party failed to win a seat (though Farage can console himself that Brexit – even if not his preferred version – would not be happening but for his long campaign to make the Brexit referendum happen in 2016).

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