General Regulatory or “Doing Business” Rules
- Many of the most important rules in relation to doing business have been harmonised throughout the European Union. There are common rules in relation to consumer protection, digital services, sale of goods, the supply of services and distance contracts. These rules mean that a single standard or method of doing business holds good throughout the European Union.
- For the most part the United Kingdom is in the course of re-enacting these European Union rules in identical or very similar terms in UK law. Therefore, there may be little immediate apparent change in such cases for businesses which provide services cross border in both directions.
- There are rules in relation to court action and disputes which seek to make it easier to enforce agreements and obtain redress in cross-border disputes arising from sales of goods and services. These rules apply both to business to business sales and more especially to business to consumer sales. Some of these rules will no longer apply to the United Kingdom after Brexit . In most cases, es very similar rules will continue to apply. In most cases the practical difference will not be apparent.
- In some cases, there will be some changes in doing business rules for UK established providers who provide services into the EU. These are likely to be relatively minor in most cases for business sectors that are not subject to direct authorisations. Some facilitations and benefits that apply to EU established providers may not be available to UK service providers. Businesses should review their particular circumstances.
- Businesses that provide services cross border into the other jurisdiction should review whether any new or differing compliance obligations arise. Information may be available from industry websites, bodies or general governmental bodies. The EU and UK guidance notes may contain helpful information.
What will happen to UK rules that are based on EU law in 2021?
- The European Union (Withdrawal) Act the so called Repeal” Act will re-enact almost all EU law in the UK, including those elements of the law that are not reflected in UK legislation on Brexit day.
- If there is a conflict between pre-Brexit laws and post-Brexit laws between two pre-Brexit laws, one of which has an EU basis, and one of which is not, the EU basis (which would have carried the principle of EU supremacy) will take precedence (necessary to maintain consistency).
- The UK courts may no longer refer to the Court of Justice of the European Union for rulings on points of EU law. Previously where matters had concerned the UK, UK advocates participated.
The Effect of Exit on Contracts
- Contract law will continue as is between parties in the Republic of Ireland and the UK unchanged. Almost everything depends on the terms of the particular contract and only exceptionally will there be some wording or circumstances that would apply to change this position.
- The mere fact of UK exit, even a no-deal exit, does not automatically discharge a contract. The changes post-2020 may make some contracts more difficult and onerous for one party to perform than before. Depending on the exact wording this could mean that one party has to perform the obligations even though the costs make the contract unprofitable.
- The terms of a contract sometimes make provision for wholly unexpected circumstances. The is usually limited to some wholly unexpected or unanticipated circumstances, which when they happen, allow one or both parties to walk away from the contract (depending on the particular wording).
- Apart from where the contract by its wording provides for exceptional circumstances, there is a general common law principle of “frustration”, which can discharge a contract when some wholly new unexpected circumstances arise.
- Whether or not UK exit or a hard exit is sufficient to frustrate the contract will depend on when the contract was made, its terms and conditions and whether the fact of the changed environment of Brexit was so wholly unexpected that it fundamentally changed the whole basis and point of the contract.
- Contracts made since Brexit and the date or UK exit has been known, may not be able to benefit from the principle of frustration or from relieving clauses in the contract.
- Intellectual property rights are very important to many businesses. They have some relevance to most businesses. Patents protect inventions which are often the subject of extensive research and investment. Copyright protects written work and software. Trademarks protect a business’ reputation and goodwill.
- Patents trademarks and certain other types of intellectual property must be registered in order to be protected. In some cases, there is the possibility of EU wide registration. Copyright arises automatically
- The main copyright, patents, industrial designs and trademark laws are subject to older international rules in relation to international recognition, which predate the UK and Ireland joining the EEC in 1973. Most national intellectual property rights which originate in the UK or the Republic of Ireland will continue to be recognised in the other state after Brexit on the same basis as before, under these international agreements.
- The EU does provide for certain newer types of copyright rights in some specialised fields, and for additional protections which go beyond the levels in the older international treaties. The UK is restating these newer rights in UK law in the same terms as before.
- The UK no-deal publication on copyright indicated that “the UK’s continued membership of the main international treaties on copyright will ensure that the scope of protection for copyright works in the UK and UK works abroad will remain largely unchanged.” The same principle would apply to Republic of Ireland copyright recognition in the United Kingdom.
- The UK no-deal publication on trademarks indicated that the UK’s existing system” for protecting trademark rights will remain largely unaffected by the UK’s decision to leave the EU”. Most businesses register national trademarks which are subject to protection under older international conventions.
- It is possible to apply for an EU wide trademark or community design which can be protected throughout the EU by a single registration. In these cases, it will be necessary to make a simplified application to the UK Intellectual Property Office to continue registration of the EU right in the UK. The UK no-deal publication states that “when the UK leaves the EU, in any scenario an EU trademark will continue to be valid in the remaining EU states and UK businesses will still be able to register an EU trademark which will cover all remaining EU states.”
- Similarly, in the area of patents, most businesses register national patents which are protected under an older international convention. It is also possible to register European Patents, which are based on a convention, separate to the EU treaties. They exist in tandem with the EU but outside of it.
- The UK’s no-deal publication on intellectual property states that “the UK’s exit from the EU will not affect the current European patent system which is governed by the (non-EU) European Patent Convention”. It also states that ‘the UK intends to stay in the Unified Patent Court and unitary patent system after we leave the EU”.
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