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Brexit - Down to the wire

Brexit - Down to the wire

European 15/10/2020

The United Kingdom (UK) exited the European Union (EU) on 31st January 2020 after 47 years of EU membership. A Withdrawal Agreement concluded between the EU and the UK established the terms of the UK’s orderly departure. In accordance with the Withdrawal Agreement, the UK is now officially a “third country” to the EU and hence no longer participates in EU decision-making. By virtue of a transition period in the Withdrawal Agreement, EU law continues to apply in and in relation to the UK until the 31st December 2020.

The Withdrawal Agreement entered into force on 1 February 2020 and consists of two main documents:

The Withdrawal Agreement itself, including a Protocol on Ireland and Northern Ireland; and

Political Declaration setting out a framework for the future relationship between the UK and the EU.

The EU and the UK will thus use the months leading up to 31 December 2020 to negotiate an ambitious and fair “partnership for the future”. In the absence of agreement on the details of that ongoing partnership the UK will deal with the EU on well-known so-called World Trade Organisation (WTO) terms from 1 January 2021.

Negotiations on details of the future partnership have been ongoing since before February 2020. On 9 September 2020 the UK government published a draft of the “United Kingdom Internal Market Bill. This sets out details of how countries of the UK like England, Scotland, Wales, Northern Ireland and Ireland will conduct business together in the future. It has been argued that certain terms in the Bill are somewhat at odds with details of the Withdrawal Agreement. Having seen the draft legislation Vice-President of the European Commission Maroš Šefčovič called for an extraordinary meeting of the EU-UK Joint Committee to request the UK government to elaborate on its intentions and to respond to the EU's serious concerns. A meeting took place late in September 2020 in London between Vice-President Maroš Šefčovič and Michael Gove.

The Vice-President stated that the timely and full implementation of the Withdrawal Agreement, including the Protocol on Ireland / Northern Ireland – which Prime Minister Boris Johnson and his government agreed to, and which the UK Houses of Parliament ratified, less than a year ago – is a legal obligation.

The Vice-President also indicated that the EU welcomes that the UK is now engaging on some of the Joint Committee decisions that need to be adopted before the end of the year to fully implement the Protocol but acknowledged that many difficult issues remain. This has subsequently resulted in the EU Commission sending the UK a letter providing formal notice for breaching obligations under the Withdrawal Agreement.

Matters for consideration for the future partnership were set out in the Political Declaration of the Withdrawal Agreement. Such matters include provisions of direct interest to citizens and businesses in areas such as transport, industrial supply chains, agricultural products, fisheries, services, data protection, provisions for a level playing field, mobility of citizens, the fight against crime, money laundering and terrorism, foreign and security policy. There are thus many disparate issues to be agreed upon between now and the end of the transition period.

In terms of the impact on Intellectual Property (IP) little has changed in the last year. How rights holders will be impacted if at all by virtue of the UKs withdrawal from the EU will ultimately likely depend upon details of any partnership agreement that is agreed. The advice in many respects is thus to still to wait and see until it becomes apparent if details of a future partnership between the EU and UK can be agreed. If agreement can be reached the terms of that agreement will almost certainly touch on rights to file, own and represent certain IP rights.

As a further albeit welcome complication it should be appreciated that the UK is simultaneously negotiating with other countries on how the UKs relationship with those countries will be defined from 2021. For example, in September 2020 the UK and Japan together announced a landmark free trade agreement. Likewise subsequent to October 16, 2018, when the Trump Administration notified Congress that the President intends to negotiate a trade agreement with the United Kingdom (UK) once it leaves the European Union (EU), in accordance with the Bipartisan Congressional Trade Priorities and Accountability Act of 2015, the UK and US are currently aligning negotiating objectives. Again, the matters agreed or being agreed upon between countries are wide ranging but include many topics pertaining to IP rights.

The attorneys at Secerna are watching developments closely and are available to advise on how the UKs decision to leave the EU might impact on you or your business. Please do get in touch with your usual Secerna contact if you would like to discuss the matter further in any detail.