Orr Litchfield

Solicitors and Business Lawyers

Brexit and the Law - The European Union (Withdrawal Agreement) Act 2020 receives Royal Assent

The European Union (Withdrawal Agreement) Act 2020 (the “Withdrawal Act”) received Royal Assent yesterday on 23rd January 2020. It makes legal provision for the ratification of the Agreement on the withdrawal of the United Kingdom of Great Britain and Northern Ireland from the European Union and the European Atomic Energy Community (otherwise known as the “Brexit Withdrawal Agreement”). The UK will leave the EU at 11pm (UK time) on 31st January 2020.

The long title of the Withdrawal Act reads in a simple and benign way, as follows: “An Act to implement, and make other provision in connection with, the agreement between the United Kingdom and the EU under Article 50(2) of the Treaty on European Union which sets out the arrangements for the United Kingdom’s withdrawal from the EU.” However, as is all too well known, it has taken months of wrangling both within the UK and in the EU to reach this stage. It remains to be seen whether it will be possible to conclude a trade agreement by the end of 2020.

You can find the full text of the 106 pages of the Withdrawal Act on the parliamentary website at http://www.legislation.gov.uk/ukpga/2020/1/enacted/data.htm 

What is the effect of the Withdrawal Act?

The immediate direct effect is negligible. Brexit will take place at 11pm (UK time) on 31st January 2020. The post-Brexit transition period will then begin.  

During the 11 month transition period, the UK will continue to follow all the EU's rules and regulations. It will also remain in the single market and the customs union. The free movement of people will continue.

The greatest challenge for the UK government and the EU will be to conclude a trading agreement by the end of 2020. It seems unlikely that the UK parliament will be able to review and replace all legislation relating in one way or another to the EU within 11 months. However, it is more likely that it will focus on key issues, simply retaining or replicating other legislation for the time-being (with minor adjustments, where required).

What does the Withdrawal Act say?

The Withdrawal Act deals with a number of matters, including:

1. The Divorce Bill - It sets out exactly how the UK will make "divorce bill" payments to the EU for years to come.

2. Repeals the European Communities Act - It repeals the European Communities Act, which took the UK into the EU, but then reinstates it immediately until the end of 2020 when the transition period ends.

3. New protocol on Northern Ireland - It contains language on how the new protocol on Ireland will work in practice, setting up what amounts to a customs and regulatory border between Northern Ireland and Great Britain.

4. European Court of Justice - It sets out areas in which the European Court of Justice will still play a role in the UK. To some extent, the Brexit Withdrawal Agreement will have a higher status than other areas of UK law.

5. Arbitration procedure – There is an arbitration procedure for disputes about the withdrawal agreement. It includes a duty for the government to report to the UK Parliament on its use of the arbitration procedure for disputes about the withdrawal agreement.

6. No extension – The Withdrawal Act prohibits any extension to the transition period beyond the end of 2020, whether or not a trade agreement has been concluded between the UK and the EU.

7. Citizens' rights - It establishes an independent monitoring authority (IMA) to deal with citizens' rights. EU nationals in the UK will be able to lodge any complaints about the way the government treats them.

8. Amendments - The bill gives ministers a lot of power to change the Withdrawal Act through secondary legislation, without MPs getting to vote (notably in relation to Northern Ireland).

What should you be doing?

Whether you own a UK or non-UK business, whether you are an exporter or importer and whether the UK is the focus of the sale of the relevant goods or services or part of a broader sales territory, you should be taking into account the potential direct or indirect effects of Brexit on your existing commercial contracts and your business generally.

Need to talk?

If you are trading from or with the UK, we can help you to understand the different legal and related commercial issues, choose the option that is right for you and minimise the legal risks for your business.

Contact us

If you would like more information or would like to discuss a potential or existing contract or dispute, please contact us by telephone on +44 (0)20 3126 4520 or +45 38 88 16 00 or by email at enquiries@orrlitchfield.com

 

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