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These Brexit highlights bring you a summary of the latest Brexit news and legislation updates from across a range of LexisNexis® practice areas, collated on 31 July 2020.
Parliament has now risen for the Summer recess and is due to return in September 2020, but we will continue to keep you updated on key developments.
For guidance on keeping up to date, including details of how to access the latest Brexit news updates and analysis, plus instructions for setting up daily/weekly alerts via email and RSS, see: How do I sign up for Brexit alerts?
This section contains key overarching Brexit news headlines.
We have published an update to our Brexit Bulletin—key updates, research tips and resources. The latest edition includes commentary and updates on key transition priorities including negotiations on the future UK-EU relationship, implementation of the Withdrawal Agreement, domestic preparation and contingency planning, plus updates on the Brexit legislation pipeline.
See: LNB News 31/07/2020 76.
The Chair of the EU Goods Sub-Committee, Baroness Verma, has written to Chancellor of the Duchy of Lancaster, Michael Gove, calling for urgent action on key issues identified in the Committee’s inquiry: Beyond tariffs: facilitating future UK-EU trade in manufactured goods. With five months left until the end of the Brexit transition period and negotiations ongoing, the lead-time to prepare for the end of the transition period is shrinking fast. The Committee warns that businesses (SMEs in particular) are not clear on, or in a position to prepare for, changes due to take effect on 1 January 2020. With those businesses already stretched in light of the coronavirus (COVID-19), the Committee warns of a risk that they will not be able to ‘absorb the double shock’ of coronavirus and post-transition requirements. The correspondence calls for urgent consideration of the serious concerns raised by stakeholders.
See: LNB News 30/07/2020 46.
The House of Lords European Union Committee (EUC) has published correspondence between Parliament and government departments on a variety of Brexit queries. Correspondence includes responses from government on queries raised in previous evidence sessions. Subjects covered include scrutiny of EU legislation during the transition period and the work of the Withdrawal Agreement Joint Committee; financial services equivalence; internal security; implementation of the Northern Ireland Protocol and transparency in negotiations on the future UK-EU relationship. In the correspondence, the EUC seeks further clarity on government plans for updating Parliament and ensuring effective national and devolved parliamentary scrutiny of the key Brexit transition workstreams, particularly the implementation of the Northern Ireland Protocol and associated legislation.
See: LNB News 24/07/2020 86.
The UK will implement the Northern Ireland Protocol in as flexible a way as possible to accommodate business and ‘everyday life’, Minister of State for Northern Ireland Robin Walker told the EUC.
See News Analysis: UK will implement Northern Irish Protocol in as flexible a way as possible, Northern Ireland minister says.
The Secondary Legislation Scrutiny Committee (SLSC) has published correspondence with the Leader of the House of Commons, Jacob Rees-Mogg, following its request for clarification on the anticipated flow and volume of Brexit SIs to be introduced in the UK Parliament before the end of the transition/implementation period (IP completion day). The government expects to lay approximately 250–300 more Brexit SIs before the end of December 2020. Approximately half of those SIs will be subject to the affirmative procedure, with volumes 'likely to be concentrated' in September and October 2020.
See: LNB News 30/07/2020 101.
The Legislation, Justice and Constitution Committee of Senedd Cymru has issued a ‘critical report’ which details the ‘flaws’ in the Welsh Government’s legislative consent memorandum for the Trade Bill. The Committee has issued caution that the Welsh Government has ‘left too much to the UK government’s discretion, while not securing enough requirements for robust Senedd scrutiny’ of the regulations affecting Wales. The Committee has also raised several concerns regarding the breadth of regulation-making powers in the Trade Bill, notably that the Bill permits the UK government to make regulations amending the Government of Wales Act 2006, despite reassurances that it is ‘not minded to exercise these powers’.
See: LNB News 30/07/2020 87.
The Scottish Constitution Secretary, Michael Russell, has made a statement to the Scottish Parliament announcing that the UK government plans for regulating the UK Internal Market will weaken the ability of the Scottish Parliament to make ‘distinctive laws and protect Scottish interests’. The legislation proposed in the White Paper outlining the UK Internal Market plans will require legislative consent from the devolved parliaments and the Scottish Government will recommend ‘in the strongest possible terms’ that the Scottish Parliament does not give any such consent. The announcement follows the UK government’s publication, on 16 July 2020, of its plans for a ‘UK Internal Market’ (see: LNB News 16/07/2020 105).
See: LNB News 30/07/2020 89.
This section contains updates on the latest final and draft Brexit SIs laid in Parliament, plus updates on proposed negative Brexit SIs laid for sifting.
SI 2020/798: This enactment is made in exercise of legislative powers under the European Union (Withdrawal) Act 2018 (EU(W)A 2018) in preparation for IP completion day. This enactment amends one piece of UK secondary legislation in relation to the Aviation Security in order to address failures of retained EU law to operate effectively and other deficiencies arising from the withdrawal of the UK from the EU. It comes into force immediately before IP completion day.
See: LNB News 29/07/2020 26.
SI 2020/784: This enactment is made in exercise of legislative powers under the EU(W)A 2018 in preparation for IP completion day. It amends two pieces of UK secondary legislation relating to air traffic management in order to address failures of retained EU law to operate effectively and other deficiencies arising from the withdrawal of the UK from the EU. These Regulations come into force in part on 18 August 2020 and fully immediately before IP completion day.
See: LNB News 24/07/2020 92.
SI 2020/796: This enactment is made in exercise of legislative powers under the EU(W)A 2018 in preparation for IP completion day. This enactment amends one piece of retained EU legislation in relation to the Online Intermediation Services for Business Users in order to address failures of retained EU law to operate effectively as a result of withdrawal of the UK from the EU. It comes into force on IP completion day.
See: LNB News 27/07/2020 9.
SI 2020/786: This enactment is made in exercise of legislative powers under the EU(W)A 2018 in preparation for IP completion day. This enactment amends eight pieces of UK subordinate legislation and revokes retained direct EU legislation relating to the regulation of railways. These Regulations come into force partly on 12 August 2020, partly immediately before IP completion day, partly on IP completion day and fully immediately before regulations 6 and 7 of the Railways (Safety, Access, Management and Interoperability) (Miscellaneous Amendments and Transitional Provision) (EU Exit) Regulations 2019, SI 2019/1310 come into force.
See: LNB News 24/07/2020 93.
The Commons European Statutory Instruments Committee (ESIC) and the Lords Secondary Legislation Scrutiny Committee (SLSC) are responsible for the sifting process under the EU(W)A 2018. These committees scrutinise proposed negative Brexit SIs and make recommendations on the appropriate parliamentary procedure before the instruments are laid in Parliament. This bulletin outlines the latest updates and recommendations, collated on 31 July 2020.
See News Analysis: Brexit SI Bulletin—latest drafts and sifting committee reports, 31 July 2020.
The Trade Remedies Investigations Directorate (TRID) of the Department for International Trade (DIT) has published new guidance on applying for a trade remedies investigation on imports causing or threatening injury to UK industry. During the transition period, applicants may only apply for investigation of imports where there is already an EU investigation in progress. From January 2021, other import practices may be investigated. Further new and updated guidance may be issued in preparation for the end of the transition period, so stakeholders are advised to monitor these pages for updates.
See: LNB News 30/07/2020 30.
HM Revenues & Customs (HMRC) has published updated guidance on applying for grants if your business completes customs declarations to help stakeholders prepare for the end of the transition period. Further new and updated guidance may be issued depending on the precise terms upon which the UK leaves the EU, so stakeholders are advised to monitor these pages for updates.
See: LNB News 29/07/2020 64.
HMRC, the DIT and the Department for Environment, Food & Rural Affairs have published new guidance on goods imported into Great Britain from the EU that are controlled to help stakeholders prepare for the end of the transition period. Further new and updated guidance may be issued depending on the precise terms upon which the UK leaves the EU, so stakeholders are advised to monitor these pages for updates.
See: LNB News 27/07/2020 57.
International Trade Secretary, Liz Truss, has formally launched the Trade and Agriculture Commission at an event in Whitehall. The new commission aims to engage the public and industry in decisions regarding UK trade policy and will advise on trade policies the government should adopt to create opportunities for UK farmers, how to enhance British consumer interests and those in developing countries, how the UK engages with the World Trade Organization and how to form trade policy that identifies and opens new export opportunities for the UK agricultural industry. The Trade and Agriculture Commission held its first meeting on 24 July 2020, at which it discussed its scope and aims, methods of working and a provisional timetable.
See: LNB News 28/07/2020 34.
The DIT has issued an update on the first round of negotiations for a UK-New Zealand Free Trade Agreement (FTA), reporting ‘positive’ and ‘productive’ talks held remotely between 13 and 24 July 2020. The negotiating teams discussed their respective objectives and agreed a forward plan for future talks. Both sides emphasised a desire to be particularly ambitious in areas including enhancing digital trade, boosting cross-border trade in services and investment, reducing uncertainty and burdens on exporters from customs procedures, and promoting good regulatory practices. The government is set to make its next statement on progress following the second round of talks scheduled to take place in October 2020.
See: LNB News 29/07/2020 50.
The DIT has announced, at the 14th Joint Economic and Trade Committee (JETCO), that the UK and India have agreed to ‘expanding and deepening’ their trade relationship. It will include an Enhanced Trade Partnership as the first step on the roadmap for a deeper trade relationship, which could eventually lead to a future Free Trade Agreement. At the JETCO meeting, the UK and India also agreed to ‘work towards removing additional barriers’ for businesses across a range of sectors including food and drink, healthcare, life sciences, IT and data and chemicals and services. DIT believes ‘increasing investment in each other’s markets is more important than ever as both economies seek to recover from the impact of Covid-19.’
See: LNB News 27/07/2020 14.
Chatham House has published a paper on the subject of post-Brexit co-operation between the UK, France and Germany and the future of the E3. The paper analyses the origins of the E3 format of diplomatic coordination between France, Germany and the UK, and its possible future development. It also looks at how the UK can make the best use of the E3 format.
See: LNB News 28/07/2020 25.
This section contains key Brexit news hand-picked by Lexis®PSL lawyers from their own practice areas.
EU Committee Chair ‘deeply concerned’ about UK policing post Brexit
The Chair of the EU Security and Justice Sub-Committee, Lord Ricketts, has written to the Minister for Security, James Brokenshire, concerning post-Brexit security and criminal justice co-operation with the EU after IP completion day. Lord Ricketts remains ‘deeply concerned’ about the adequacy of the replacements for co-operation with the EU in matters of security and policing. In particular, Lord Ricketts highlights the importance of systems such as the Schengen Information System and the European Criminal Records Information System, without which the time taken to complete checks could increase from being ‘pretty much instantaneous’, to taking 66 days on average. The letter responds to the Minister for Security’s letter of 26 June 2020.
See: LNB News 27/07/2020 58.
For further updates from Corporate Crime, see: Corporate Crime weekly highlights—overview.
Council endorsement of changes to the EU regulations on service and the taking of evidence
The European Council has endorsed the provisional agreement reached with European Parliament on the European Commission's amended regulations for the service of documents and the taking of evidence abroad.
See: LNB News 24/07/2020 15.
For further updates from Dispute Resolution, see: Dispute Resolution weekly highlights—overview.
Committee outlines findings from Environment and the Level Playing Field inquiry
The Chair of the EU Environment Sub-Committee, Lord Teverson, has written to the Secretary of State for the Department for Environment, Food and Rural Affairs, George Eustice, outlining the key finding from the Environment and Level Playing Field inquiry. The key findings include that the lack of trust is the biggest barrier to a breakthrough on the environment and climate change parts of a UK-EU agreement, the environment and climate need not be a stumbling block due to the UK and EU having similar ambitions, and the government should consider domestic measures to build trust, such as strengthening environmental principles. Additionally, the Committee found that an agreement is possible which addresses EU concerns without restricting the government’s ability to increase ambition or to choose different policies to achieve the same goals, and that it is expected EU negotiators are open to clarifying that environmental non-regression would allow for independent policy making in the UK.
See: LNB News 27/07/2020 78.
Defra announces phasing out of EU greening requirements effective 2021
Defra has announced that farmers in England will benefit from a reduced administrative burden and will no longer have to comply with the EU’s greening requirements effective from 2021. Under EU greening requirements farmers had to carry out ‘specified practices’ to qualify for additional payments, however, under new government plans to simplify the Basic Payment Scheme (BPS) and ‘cut red tape faced by farmers during the agricultural transition period’ those requirements will be reduced. Changes will not affect the overall payment amount received by each farmer, as the money will be added to their entitlement under the BPS. As the UK prepares for Brexit and the agricultural transition period, which will last seven years, it will phase out Direct Payments to farmers in England and replace it with the new Environmental Land Management (ELM) scheme. The ELM scheme seeks to 'deliver better environmental outcomes' by incentivising farmers to deliver 'public goods’ including planting trees and hedges, river management to mitigate flooding, and creating or restoring wildlife habitats. The scheme is expected to be rolled out in late 2024, however, most farmers in England can expect to be supplemented by alternative means of support, such as remaining eligible to apply to Countryside Stewardship schemes until the ELM scheme is rolled out.
See: LNB News 28/07/2020 20.
EBA calls on financial institutions to finalise preparations for the end of Brexit transitional arrangements
The European Banking Authority (EBA) reminded financial institutions to adequately prepare for the end of the transition period between the EU and the UK. The EBA calls on the institutions to finalise the full execution of their contingency plans in accordance with the conditions agreed with the relevant competent authorities and ensure adequate communication to concerned EU customers. The EBA stresses that contingency plans remain especially relevant for payment and electronic money institutions.
See: LNB News 29/07/2020 79.
Lloyd's of London Part VII Transfer update
Lloyd's of London (Lloyd's) issued an update, stating that the effective date for the transfer of EEA policyholder business to Lloyd’s Insurance Company S.A. (Lloyd’s Europe) has been extended to 30 December 2020 (IP completion day).
See: LNB News 23/07/2020 107.
For further updates from Financial Services, see: Financial Services weekly highlights—overview.
EDPB publishes note with steps to take to ensure BCRs are compliant post-Brexit
The European Data Protection Board (EDPB) has published an information note on Binding Corporate Rules (BCRs) for organisations which have the Information Commissioner’s Office as the competent supervisory authority, explaining steps they need to take if they wish to rely on their BCRs as a valid transfer mechanism for transfers of personal data outside the EEA after the end of the Brexit transition period.
See: LNB News 23/07/2020 65.
For further updates from Information Law, see: Information Law weekly highlights—overview.
FTA with mutual recognition agreement ‘best option’ for EU-UK pharma trade
The European Federation of Pharmaceutical Industries and Associations has published a report on the impact of the EU-UK future trade relationship on the European pharmaceutical industry. The research was carried out by the Institute for International and Development Economics. The study compares three scenarios for the future relationship between the EU and the UK and their long-term economic impact on GDP, medicines production and trade. The report concludes that a free trade agreement with a mutual recognition agreement will likely be the most beneficial scenario for both parties.
See: LNB News 23/07/2020 39.
For further updates from Life Sciences, see: Life Sciences weekly highlights—overview.
Intergovernmental relations and the UK ‘Internal Market’
Intergovernmental relations (IGR) in the UK are largely informal. These allow for joint working between the UK, Scottish and Welsh Governments and the Northern Ireland Executive, as well as resolution of disputes. A recent White Paper on the UK Internal Market says that existing IGR mechanisms will have to be ‘expanded’ to account for forthcoming legislation. The UK government is also considering ‘tasking an independent, advisory board’ to report on the functioning of the UK Internal Market. In this analysis, David Torrance at the House of Commons Library examines the intergovernmental aspects of that White Paper, looking at IGR as they stand, the proposed changes and concerns from the Scottish and Welsh Governments.
See News Analysis: Intergovernmental relations and the UK ‘Internal Market’.
For further updates from Public Law, see: Public Law weekly highlights—overview.
New guidance on using postponed VAT accounting
In preparation for the end of the Brexit transition period, HMRC has published new guidance for UK VAT-registered businesses using postponed VAT accounting. From 1 January 2021, UK VAT-registered businesses will, in some circumstances, be able to account for import VAT on their VAT return for goods imported from anywhere in the world, meaning that the business can declare and recover import VAT on the same VAT return. In relation to this, HMRC has published new guidance on when a business can and cannot account for import VAT on their VAT return. Guidance has also been published on how to complete a VAT return for businesses using postponed VAT accounting after the end of the transition period.
See: Check when you can account for import VAT on your VAT Return and Complete your VAT Return to account for import VAT.
For further updates from Tax, see: Tax weekly highlights—overview.
LexTalk® is an online community forum which gives Lexis®PSL subscribers the opportunity to post questions, hold conversations, participate in discussions and share best practice. It has been designed to provide a secure place for legal professionals to discuss legal developments, offer and receive peer support, and gain a sense of up-to-date market practice and advances in real-time. You can access and post questions on all of the dedicated practice area forums, including a dedicated community for Lexis®PSL Brexit.
Click here to sign up and meet like-minded community members, create a profile, connect, share, and start participating today! Alternatively, you can access LexTalk® on the key resources tab on your Practice Area home page.
The following recent journal articles are available subject to subscription:
● What does the future hold? In this article, Charlotte Barbour and Susan Cattell consider the potential and benefits of reforming the tax system, noting that the uncertainty caused by the prolonged Brexit process and the coronavirus pandemic (COVID-19) may present the government with an opportunity to generate public debate and support for tax reform. See: Taxation, 23 July 2020, 8
● State of the Union: EU's soft power will still govern data transfer: In this article, Jonathan Goldsmith comments on the Court of Justice decision in Schrems II and its relevance to the UK, citing the case as an example of the importance of EU case law in the UK even after the Brexit transition period ends. See: Law Society Gazette (2020) LS Gaz, 27 Jul, 11
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