The United Kingdom will be voting on the crucial issue of Brexit on 23 June 2016. This vote would resolve the dilemma surrounding Britain’s exit from the European Union. European Union leaders met in a summit on the 19th of February, 2016 and agreed on collective reforms such as the provision for limiting benefits provided to EU migrants.
This situation would result in two outcomes which are clearly evident. The first one implies that Britain stays in the EU and business goes on as normal. On the contrary, if UK chooses to turn away from the European Union then the subsequent results depend on the nature of UK’s departure from the European Union.
The road for UK to leave the EU:
- The European Union has clearly stated the terms for a country to leave the European Union.
- Article 50 of the Treaty on Functioning of European Union states that a member country of the EU needs to notify two years in advance of its intention to quit the EU.
- This clause allows the EU to take two years and negotiate the terms of exit with the concerned country, in this case, the UK.
- At the end of the two years, UK wouldn’t be a member of the European Union.
- Finally, Britain would be relieved from the burdens and benefits of the European Communities Act 1972.
Considerable impact on UK Law:
- Competition law:
The relevancy between EU competition law and that of UK will be a prime factor to have impact in-laws in the UK. UK companies operating in members of EU follow the EU competition law, and the UK competition laws are somewhat similar to that of the EU. However, the largest effect will be seen in removal of EU public procurement laws and state aid laws. This action depends on the terms of exit.
- Financial Services Regulation:
It is just not clear that how the UK law will be modified since UK’s law for regulating financial institutions is largely based on the EU law. Once Britain exits from the EU, organizations from UK cannot access many European Union markets.
- Employment law:
As we have been discussing, the majority of UK law including employment laws is a slight replica of the EU law. Some of the employment rights of employees, working time regulations face the risk of repealing. Other impacts of Brexit on the employment laws may include formulation of separate terms for EU workers.
Dealing with the storm:
There is no reason to be alarmed at the title mentioned here! The exit of Britain from the EU is nothing less than a storm. Thus, we should ensure necessary steps to stay safe from any monetary or legal setbacks.
- Businesses dependent on EU aids must review business plan and strategy
- Contracts shall be reviewed for finding out governing laws and clauses of jurisdiction.
- Estimate the probable impact of Brexit on the sector you are operating in.
Following these procedures along with a series of other precautions can prevent any substantially detrimental impact on a business despite the changes in UK law due to Brexit.