3 key actions to help organisations prepare for a potential Brexit

brexit

Lewis Crofts is Global Chief Correspondent at MLex Market Insight, an independent media organisation providing market insight, analysis and commentary on regulatory risk. In this analysis, he outlines 3 key actions to help organisations prepare for a potential Brexit.

If the UK votes to leave the EU in June any changes to the regulatory framework would be determined by the UK’s relationship with the remaining EU countries. That relationship will define how much freedom the UK gets to design its own laws and how far it will still be obliged to apply EU norms. Nonetheless, one thing is certain: if the UK wants to continue to access the markets of its EU neighbours it will need to continue applying EU laws to a large degree.

Further, there would be a monumental impact on the hundreds and hundreds of laws on the UK statute books which are based on or inspired by EU legislation. For each of those, the UK must decide whether to maintain the law, amend it or scrap it. In reality, much of the legislation will remain, at least for a transitional period. But the next decade could be dominated by a lengthy legal process of uncoupling UK laws from their European moorings.

The resultant main risk for companies is uncertainty.

Not knowing what the legal landscape will be could affect business confidence, postpone investments and in the worst case scenario lead some businesses to set up elsewhere in the EU. This of course also provides a clear opening for the legal advisory market, to help companies navigate their way to the new status quo. Long-term, the major opportunity will be if the UK exploits its new-found freedom outside of the EU to entice businesses with a light-touch company-friendly legal system that eases regulatory burdens and promotes innovation.

So how can businesses prepare for a potential Brexit?

EU law permeates most aspects of life and so everything from drug approvals to food labelling to textiles imports could be affected by a possible ‘Brexit’. But the sectors that come most directly under the ambit of EU regulations -- for example energy and financial services -- will face the most immediate risks in navigating the new status quo. But activities undertaken by every company -- such as employee contracts and processing data -- will also be affected so it is highly unlikely that any sector will go untouched

There are 3 clear actions an organisation can take:

  • Look at your regulatory obligations -- everything from employment contracts to handling data -- and work out what could change
  • Start contingency planning. The reality is that no-one knows what the UK’s new relationship to the EU will be under a ‘Brexit’ scenario so it is best to have some contingency plans in place
  • Stay informed and be prepared. Few organisations will be taking any concrete action at this stage, however, the best thing a company can do is not be caught completely unawares.

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DOWNLOAD OUR BREXIT REPORT: CONTINENTAL SHIFT: BREXIT & THE LAW
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As the debate rages across the nation, LexisNexis has been working with industry experts to cut through the politics and assess the implications of a possible Brexit.

With gallons of ink already spilled over the political machinations, our panels of experts discuss:

  • Views from around the world: exploring the effect of the UK’s exit from the EU on different jurisdictions across Europe
  • The mechanics of an exit including:
    • Leaving the EU – impact on case law and legislation
    • EU referendum – implications on constitution and practice
    • Preparing for the Brexit – the dual nationality trend
    • EU referendum – Leave, remain or renegotiate
  • Referendum essentials including:
    • A guide to UK referendums
    • Running and participating in referendums in the UK – lessons learnt
    • Getting the messaging out – political broadcasting in the UK

To download the full report, click here 
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