In August, the government outlined its preparations for a no-deal scenario and published the first 25 in a series of “no deal” technical notices.
No-deal Brexit speech
“No deal” describes the scenario in which the UK and the EU fail to conclude a draft withdrawal agreement by the time of the UK’s exit from the EU. Instead of a co-ordinated or negotiated departure that would minimise disruption for businesses and individuals, this would result in a lack of transition period and a sudden “cliff-edge” break in the application of EU rules to the UK at 11pm on 29 March 2019.
On 23 August 2018, the Brexit secretary, Dominic Raab gave a speech outlining the government’s preparations for a no-deal scenario. The speech confirmed that if there is no deal, the government will take unilateral action in some cases to maintain as much continuity as possible in the short term, whether or not the EU reciprocates. The government will also continue necessary engagement with the EU on no-deal planning, for example, between the UK and the EU on data protection, and between the UK and the port authorities of EU member states.
No-deal Brexit technical notices
On the same day, the government published the first tranche of 25 technical notices on a variety of issues that aim to provide guidance and information for UK businesses and citizens on how to prepare for the UK leaving the EU without a withdrawal agreement in place. It is expected that more than 80 notices will be published in total, and that further notices will appear in September.
One of the notices was an overarching framing notice, which explains why the government was publishing the no-deal notices and outlines the government’s approach to preparing the UK for a no-deal exit.
Four technical notices were published on importing and exporting with guidance on trading with the EU and tariff classification of goods in the event of no deal:
- Trade remedies if there’s no Brexit deal.
- Trading with the EU if there’s no Brexit deal.
- Classifying your goods in the UK Trade Tariff if there’s no Brexit deal.
- Exporting controlled goods if there’s no Brexit deal.
These include the immediate consequences for trade and actions that exporters and importers should take before 29 March 2019.
VAT for businesses if there’s no Brexit deal provides guidance on VAT in relation to goods and services traded between the UK and the EU. The notice announces that postponed accounting for import VAT on goods brought into the UK (both from the EU and non-EU countries) will be introduced and confirms that low value consignment relief will be abolished.
The technical note on workplace rights states that there would be minimal change to UK legislation derived from EU law if there was no deal by the 19 March 2019 deadline. While the government planned minor amendments to UK employment legislation wording to reflect the fact the UK will be leaving the EU – these will leave existing employment rights unchanged.
The notice on state aid provisions sets out that the UK would immediately implement a UK-wide subsidy control framework that transposes EU state aid rules into UK domestic legislation, applicable to all sectors, and will mirror existing block EU exemptions.
The government has also published guidance on the impact on banking, insurance and other financial services if the UK leaves the EU without agreement.
Article 50 negotiations
The speech and notices followed a further round of Article 50 negotiations on 21-22 August between Raab and the Commission chief negotiator Michel Barnier, where it was agreed that the UK and the EU would negotiate continuously.
The next major step is the European Council meeting on 18 October 2018, where the EU and the UK intend to finalise the Article 50 negotiations, to allow time to ratify the withdrawal agreement before the UK’s planned withdrawal date on 30 March 2019.
Immigration: UK plans to process applications for settled status alphabetically
On 16 August 2018, the European Parliament’s Brexit Steering Group (BSG) issued a statement of concern at reports that the UK Home Office is considering processing applications for “settled status” by EU citizens in the UK on an alphabetical basis.
The BSG’s concern was that this would be an arbitrary approach creating unnecessary uncertainty for many citizens and would go against the spirit of the UK’s previous assurances.