Latest legal and regulatory update— 30th August

Latest legal and regulatory update— 30th August

We bring you updates across Brexit, Risk & Compliance Information Law and Employment.

This month we cover issues including, the prorogation of parliament, Brexit preparations for a no-deal exit, data protection, and CEO pay. We also look at employment - workplace pensions and Bitcoin fraud.

In this issue:

  • Brexit
  • Risk & Compliance
  • Corporate
  • Information Law & TMT
  • Employment

 

Brexit

Prorogation of parliament 

On 28 August 2019, the Prime Minister asked the Queen to prorogue Parliament, bringing the current parliamentary session to an end on 10 September 2019, ahead of a new session commencing with a Queen’s Speech on 14 October 2019. The timing of the announced prorogation is controversial, as it will severely limit the parliamentary sitting time in the lead-up to exit day. Kieran Laird, partner and head of constitutional affairs in the Gowling WLG Brexit Unit and Richard Eccles, partner at Bird & Bird, consider what prorogation means for Brexit. For further information, see: LNB News 28/08/2019 46.

Brexit preparations and more no-deal guidance

With exit day fixed in law on 31 October 2019, and the government set on sticking to this deadline, preparations for a no-deal Brexit are critical. Designed to ready the UK statute book for Brexit with or without a deal, the European Union (Withdrawal) Act 2018 is an essential reference for lawyers preparing for exit day. Our bulletin highlights one of the key features of this legislation, retained EU law, with links to new materials, background reading and tips for tracking Brexit related legislation and developments. See News Analysis: Brexit Bulletin—getting to grips with retained EU law.

The Cabinet Office has announced that it will not make companies working with the government on Brexit preparations sign non-disclosure agreements (NDAs) in ‘the vast majority of circumstances’. NDAs will now only be used in cases where they are necessary—for example, in protecting the interests of third parties. See: LNB News 22/08/2019 31.

The Department for International Trade has announced that the UK and South Korea will sign a new trade deal to ensure continuing trade after Brexit. The deal duplicates, ‘as far as possible’, the effects of the current EU–South Korea deal. See: LNB News 22/08/2019 17.

The Office of the Secretary of State for Wales has published new guidance for individuals and businesses in Wales to help stakeholders prepare for the UK leaving the EU without a deal in place. See: LNB News 27/08/2019 20.

 

Risk & Compliance

Data protection 

The University College London European Institute has raised serious concerns over the no-deal Brexit arrangements for personal data flows between the EU and the UK. The Institute highlights that 75% of the UK’s international data flows are with the EU, and much UK economic activity is dependent on these flows. Therefore, the Institute warns of significant disruption to EU–UK personal data flows in the event of a no-deal Brexit which would result in no adequacy decision. See: LNB News 27/08/2019 6.

The Information Commissioner’s Office has published a blog post on how organisations developing Artificial Intelligence (AI) can ensure compliance with data minimalisation requirements covering different techniques organisations can adopt to develop AI systems using as little personal data as possible. See: LNB News 22/08/2019 39.

Anti Bribery and Corruption 

A recent report from the UK Fraud Advisory Panel about unchecked domestic corruption is justified to an extent, but it may be too harsh to make a blanket condemnation of UK enforcement agencies’ approach to tackling economic crime, says Syedur Rahman of Rahman Ravelli. See News Analysis: A look at UK enforcement efforts against domestic bribery.

Pam Shearing, director and solicitor, and Rubi Palmieri, solicitor, both at Fulcrum Chambers Ltd, consider the implications of the updated corporate co-operation guidance from the UK Serious Fraud Office (SFO). See News Analysis: SFO guidance on corporate co-operation.

Solicitors Regulation Authority

The Solicitors Regulation Authority has announced a consultation on the regulation of ‘civil and criminal advocacy’. The consultation outlines proposals to improve current regulation covering the quality of civil and criminal advocacy. The deadline for responses is 13 November 2019. See: LNB News 22/08/2019 26.

Corporate

Share purchase agreements 

Commercial analysis: The sellers under a share sale and purchase agreement were entitled to disclosure of an accounting report, prepared by accountants instructed by the buyer in order to calculate whether additional consideration was payable by the buyer. The report was prepared under a contractual review mechanism undertaken at the request and expense of the sellers. The court required the disclosure of the report to the sellers, not because that provision made the buyer an agent of the sellers when instructing the accountants (it did not), but under an implied term. The case emphasises the importance of including express wording as to a party’s information rights under a contract. In its absence, the scope of disclosure required by the general law is likely to be more limited. Written by Seb Oram, barrister at 3PB Barristers. For further information, see News Analysis: Sale and purchase agreements—entitlement to disclosure of post-completion valuation report (Zedra Trust Company (Jersey) Ltd v The Hut Group Ltd) and [2019] All ER (D) 97 (Aug).

CEO pay

The Chartered Institute of Personnel and Development and the High Pay Centre have released their annual report examining trends in executive pay across the FTSE 100 during 2018. According to the authors of the report, the median and mean pay packets of FTSE 100 CEOs have fallen since last year’s report, and executive pay for FTSE 100 bosses is now at its lowest level since 2010. For further information, see: LNB News 22/08/2019 34.

Amendments to NEX Exchange trading rules

The NEX Exchange has published a consultation on proposed amendments to the NEX Exchange trading rules. See: LNB News 22/08/2019 32.

 

Information Law & TMT

A Bitcoin first? 

In what is believed to be the first decision of its kind, in Robertson v Persons Unknown (not reported by LexisNexis®), Stewarts has obtained an asset preservation order (APO) over Bitcoin worth more than £1m stolen by fraudsters. In making the APO, the court had to consider the most important unresolved legal issue about Bitcoin: is Bitcoin legal property (as opposed to mere data or information) and, if so, what kind of property is it? Analysis by Marc Jones, of Stewarts Law, who represented Liam Robertson. See News Analysis: A Bitcoin first? Stewarts obtains asset preservation order over cryptocurrency (Robertson v Persons Unknown).

Passing off 

In a judgment from 2 August 2019 that has now become available, the Intellectual Property Enterprise Court has dismissed a claim for passing off. The court considered the three limbs of the test for passing off and found that the claim was not supported by the evidence. In doing so, it highlighted the importance of adducing compelling evidence that a substantial number of members of the public have been deceived by the defendant’s use of the name complained of, to support a claim of misrepresentation in a passing off case. See News Analysis: Passing off claim fails in the IPEC (Innovation v Unity in the Sun).

New rules for media and communications claims 

Nick Grant and Edward Smith, members of Payne Hicks Beach’s privacy and media team, look at the implications of the new Pre-action Protocol for media and communications claims (the new PAP). See News Analysis: New pre-action protocol for media and communications claims.

 

Employment

Workplace pensions 

Employers are being warned not to put their head in the sand after one business ended up with a £350,000 fine for failing to comply fully with its pension duties. The anonymous case study is included in the latest quarterly compliance and enforcement bulletin published by The Pension Regulator. See News Analysis: LNB News 22/08/2019 24.

Company car fuel rates 

New advisory fuel rates for employers with company car schemes, which apply to all journeys made on or after 1 September 2019, have been released by the Government. See News Analysis: Company car fuel: revised advisory rates to take effect from 1 September 2019.

Employee shareholders 

In Barrasso v New Look Retailers (UKEAT/0079/19), the EAT held that the status of an employee as an ‘employee shareholder’ may, or may not, be changed by a later employment contract being entered into, depending on whether its terms are, or are not, inconsistent with the original employee shareholder agreement. See News Analysis: Employee shareholder status may, or may not, be changed by later contract (Barrasso v New Look Retailers).

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About the author:
Allison is a former partner of Shoosmiths, with extensive experience of legal management and practice compliance.