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The UK has left the EU, what now?

05 February 2020

After months of uncertainty and debate, the UK has now officially left the European Union and our MEPs have left their offices in Brussels.

At this point, we are still treated as a member of the European Union, but we do not have any voting rights. We will continue to be bound by EU rules as they currently stand, and any future rules that are introduced during this period which is called the transition period.

Jeremy Glen
Jeremy Glen, Partner

Fraser Crombie
Fraser Crombie,
Trainee Solicitor

The transition period will last until 31 December 2020, to allow for time to negotiate the future relationship between the UK and the EU. Although the length of the transition period could change due to political factors, the date is written into law. As it stands, the UK Government has ruled out any extension to this period. Therefore, after the 31 December 2020, we will no longer be treated as an EU member state.

What happens now?

During this transition period, businesses can continue to access the EU market as they normally would. Little will change. However, we may lose access to some markets through trade deals which have been negotiated by the EU as one block, as third-party countries are not legally bound by the Withdrawal Agreement to continue to treat the UK as a member of the EU.

How should my business prepare ahead of the 31 December 2020?

As it stands, we do not know what the future relationship between the UK and the EU will look like. The next phase of the Brexit process revolves around the negotiation of the future relationship between the European Bloc and the UK. There seems to be a willingness from both sides to agree a free trade deal, however this is not certain. If no free trade deal with the EU has been agreed by 31 December 2020, the UK will automatically trade with the EU on World Trade Organisation Terms.

Businesses should therefore plan on the basis that current arrangements with the EU will end on 31 December 2020. This will mean that we will leave the customs union and VAT regime. We will also leave the single market, which will inevitably lead to some barriers to trade. Moreover, freedom of movement with the EU will end.

Businesses that trade with the EU should plan ahead for potential disruption, changes to customs processes and tariffs to export their products to the EU. Moreover, your business may find it more difficult to employ European workers after the end of the transition period. These are all factors that need to be taken into account when planning for Brexit.

If a trade deal is agreed before 31 December 2020, businesses should still plan for changes to current processes, the existence of barriers given that we will be outside of the single market and disruption at borders, given that the new processes will take time to implement.

At the time of writing there is still a great deal of uncertainty over how our future relationship with the EU will look. Here at BTO, we will be keeping a close eye on all Brexit developments, helping businesses navigate through this difficult period.

Jeremy Glen
 Partner T: 0141 221 8012 
Fraser Crombie Trainee Solicitor T: 0141 221 8012


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