PublicationsLegal Implications of Brexit

September 29, 20200
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Abstract

This paper addresses the legal implications of Brexit, identifying both the benefits and issues that surround it. The analysis is mainly based on assumptions as the long term legal implications of Brexit cannot be certain as it is an unknown area. The focus will be on the likely implications on businesses, immigration and the legal sector. It will also consider the United Kingdom’s worldwide status following the Brexit decision and the impact of future international trade deals. This is an important area as it is contemporary and likely to impact millions of individuals. The findings of this research suggest that Brexit is likely to have more negative legal implications.

Introduction

Brexit is the term used to describe the United Kingdom’s (UK) decision to withdraw from the European Union (EU) following the referendum in 2016.[1] The EU is ‘a unique economic and political union between 27 EU countries that together cover much of the continent’.[2] It was created to establish an internal market, for peace, economic reasons and to improve work. This means that the UK will no longer be bound by European Union competences such as trade, goods, services and capital. Many believe, including the author that the long-standing legal implications are unknown, it is likely that businesses, immigration and the legal sector will be profoundly impacted. This essay will focus on the likely impacts on the aforementioned areas assessing the possible benefits and negatives of each area.

Benefits for International Workers under Brexit

One of the main legal implications will be the impact on immigration. The introduction of the immigration points-based system in 2021 means that both non-EU citizens and EU citizens will be treated equally under UK law. On contrary, under the EU law, any EU citizen can move to another member state and reside freely for up to three months before applying for conditional residence.[3] A point-based system means that any individual wishing to work in the UK is required to ascertain a specific number of points to be granted a visa. The requirements involve knowledge of the English language, a job offer and a general salary of at least £25,600.[4] This is a benefit as all international workers will have the same opportunity to work in the UK. The creation of the points-based system will ensure that all international workers are economically active thus helping to sustain the economy.

The Adversity of Brexit on Economy

Under Article 20 and 21 of Treaty of the Functioning of the EU,[5] citizens of member states are able to move freely between all member states to work or reside. In 2016, 3.6 million EU citizens were living in the UK.[6] European migrants also contribute £2300 more than the average UK born adult.[7] As immigration controls tighten, it is likely that the number of migrants will decrease as they fail to meet the number of points required to obtain a visa.  The UK economy could subsequently decline without extra support. This is a clear negative implication of Brexit. Additionally, migrants and immigrants are generally more likely than UK born adults to undertake low skilled jobs.

This means that there will be a huge gap in the employment market in industries such as cleaning and farming as aforementioned the minimum wage requirement is £25,600 in most cases. This is considered highly problematic as low skilled jobs already face a shortage of staff. For example, one in 11 posts is unfilled in adult social care.[8] As the UK has an ageing population, there will be an increase in demand for carers and a smaller number of workers meaning that less revenue will be generated as elderly people generally rely on their state pension.[9] This will consequently impact the economy and lead to a strain on resources.

The Implication of Brexit on Social System

It could also increase the growing racial and xenophobic tensions and tolerance within the UK. Since the Brexit referendum in 2016, reports of racial discrimination towards ethnic minorities has increased from 58% in 2016 to 71% in 2019.[10] The stark increase is attributed to the fact that immigration was one of the main contributors to the Brexit campaign. An increase in hate crime will lead to more arrests and processing costs. It could also lead to more trials and add further strain onto the criminal justice system which already has a backlog of cases. This could lead society to become more unsettled and unsafe.

However, the possibility of a decrease in both immigration and migration can be viewed as a benefit as it was a contributing factor for voters of Brexit. The decrease could potentially lead to much-needed changes to public services.


Dynamics of Businesses under Brexit

The legal implications of Brexit will have a major impact on businesses in the UK. New international businesses will be less likely to set up in the UK, particularly member states of the EU as visas will be harder to obtain. There have already been many reports of businesses choosing to relocate in the Netherlands rather than the UK. This is because of the English speaking population and the links with the rest of the EU.[11] This could impact the UK negatively as businesses may fail to expand abroad. Many businesses were already negatively impacted by Brexit just two years after the vote due to geopolitical uncertainty and the decline of the value of the pound.[12]

However, smaller, independent businesses will have a better opportunity to thrive within society without added competition. The termination of free movements of goods is another impact that businesses will sustain meaning that import and export prices will increase. A benefit of the termination of free movement of goods would be that local produce could become more prominent within the economic market. This could lead to a smaller carbon footprint, as well as boosting local sales. The price of local produce is likely to become more expensive and could therefore cause a ripple effect. This would mean that lower-income households may struggle with an increase in food prices leading to a higher reliance on benefits and food banks thus damaging the economy and causing further social unrest.

The Paradigm Shift of Legal Statute

For almost five decades, legislation within the UK has had to comply with EU law following the European Communities Act 1972.[13] One of the largest legal implications of Brexit will be the reformation of almost every law, from data laws to food labelling laws. This will be viewed as a benefit by eurosceptics who were always concerned with the parliamentary sovereignty lost when the UK joined the EU. It will also mean that the European Court of Justice will no longer have jurisdiction over the UK thus meaning that the highest court will be the Supreme Court. This furthers the idea of the UK back in full control of its judicial system and retaining sovereignty.

However, the removal of further checks on the judicial system could give rise to unfair outcomes of cases. The removal of significant discrimination acts such as the Human Rights Act 1998,[14] and the European Convention of Human Rights,[15] puts human rights in jeopardy. This is likely to have a disproportionate impact on minorities, LGBT and disabled individuals. For example, illegality was declared in the Anti- Terrorism, Crime and Security Act 2001,[16] as it did not comply with the Human Rights Act 1998.[17] If the same unlawful act was passed after the transition period, there would be nothing within domestic law to prevent it from occurring.

The legal implications of Brexit will undoubtedly impact the legal sector, particularly regarding international arbitration. This is a method of resolving international disputes. London is a prominent city for resolving arbitration as English law has been held in high regard for centuries and is often used to govern international commercial contracts. Despite the UK’s withdrawal from the EU, it is unlikely that the attitudes of the courts will change and therefore international arbitration competition may increase. English arbitration awards occur under the New York Convention with 157 signatories, membership of the EU is not conditional and therefore Brexit will have no impact.[18]

Conclusion

The legal implications of Brexit are likely to have a large impact on businesses, immigration and the workings of the legal sector. It is also perceived to have more negative implications than positive.


REFERENCES-

Primary

Acts

Anti- Terrorism, Crime and Security Act 2001

European Communities Act 1972

Human Rights Act 1998

Conventions

European Convention of Human Rights

Directives

Directive 2004/38

Treaties

Treaty of the Functioning of the EU

Secondary

Articles

Alice Tidley, ‘Brexit: Number of companies to the Netherlands is accelerating’ https://www.euronews.com/2020/02/19/brexit-number-of-companies-relocating-to-the-netherlands-is-accelerating, accessed 16th September 2020

‘Challenges of an ageing population’ https://www.parliament.uk/business/publications/research/key-issues-parliament-2015/social-change/ageing-population/ accessed 16 September 2020

‘EU Referendum (Archived)’ https://www.gov.uk/government/topical-events/eu-referendum accessed 16 September 2020

‘Goals and Values of the EU’ https://europa.eu/european-union/about-eu/eu-in-brief_enaccessed 21 August 2020

‘How will Brexit impact arbitration in England and Wales?’ (September 2016) https://www.nortonrosefulbright.com/en-gb/knowledge/publications/a655ac50/how-will-brexit-impact-arbitration-in-england-and-wales accessed 24 August 2020

‘Immigration: No visas for low-skilled workers’ https://www.bbc.co.uk/news/uk-politics-51550421 accessed 16 September 2020

Manisha Patel, ‘Eighty- two percent of UK businesses…’ https://thefintechtimes.com/eighty-two-percent-of-uk-businesses-believe-europe-is-key-to-future-expansion-but-nearly-half-have-felt-negative-impact-of-brexit/ accessed 16 September 2020

Oxford Economics, ‘The Fiscal Impact of Immigration on the UK’ https://www.oxfordeconomics.com/recent-releases/8747673d-3b26-439b-9693-0e250df6dbba accessed 22 August 2020

Robert Booth, ‘Racism rising since Brexit vote’ https://www.theguardian.com/world/2019/may/20/racism-on-the-rise-since-brexit-vote-nationwide-study-reveals?CMP=Share_iOSApp_Other

Robert Mcneil, ‘EU migration to and from the UK’ (30 September 2019) https://migrationobservatory.ox.ac.uk/resources/briefings/eu-migration-to-and-from-the-uk/ accessed 22 August 2020

‘The UK’s point based immigration system’ https://www.gov.uk/government/publications/uk-points-based-immigration-system-employer-information/the-uks-points-based-immigration-system-an-introduction-for-employers#:~:text=From%201%20January%202021%2C%20free,a%20points%2Dbased%20immigration%20system.&text=Under%20a%20points%2Dbased%20immigration,those%20who%20gain%20enough%20points. accessed 16 September 2020

[1]‘EU Referendum (Archived)’ https://www.gov.uk/government/topical-events/eu-referendum accessed 16 September 2020

[2] ‘Goals and Values of the EU’ https://europa.eu/european-union/about-eu/eu-in-brief_en accessed 21 August 2020

[3] Article 21 Treaty of the Functioning of the European Union and Directive 2004/38

[4] ‘The UK’s point based immigration system’ https://www.gov.uk/government/publications/uk-points-based-immigration-system-employer-information/the-uks-points-based-immigration-system-an-introduction-for-employers#:~:text=From%201%20January%202021%2C%20free,a%20points%2Dbased%20immigration%20system.&text=Under%20a%20points%2Dbased%20immigration,those%20who%20gain%20enough%20points. accessed 16 September 2020

[5] Article 20 and 21 of Treaty of the Functioning of the EU, https://eur-lex.europa.eu/legal-content/EN/TXT/?uri=OJ:C:2016:202:TOC

[6] Robert Mcneil, ‘EU migration to and from the UK’ (30 September 2019) https://migrationobservatory.ox.ac.uk/resources/briefings/eu-migration-to-and-from-the-uk/ accessed 22 August 2020

[7] Oxford Economics, ‘The Fiscal Impact of Immigration on the UK’ https://www.oxfordeconomics.com/recent-releases/8747673d-3b26-439b-9693-0e250df6dbba accessed 22 August 2020

[8] ‘Immigration: No visas for low-skilled workers’ https://www.bbc.co.uk/news/uk-politics-51550421 accessed 16 September 2020

[9] ‘Challenges of an ageing population’ https://www.parliament.uk/business/publications/research/key-issues-parliament-2015/social-change/ageing-population/ accessed 16 September 2020

[10] Robert Booth, ‘Racism rising since Brexit vote’ https://www.theguardian.com/world/2019/may/20/racism-on-the-rise-since-brexit-vote-nationwide-study-reveals?CMP=Share_iOSApp_Other

[11] Alice Tidley, ‘Brexit: Number of companies to the Netherlands is accelerating’ https://www.euronews.com/2020/02/19/brexit-number-of-companies-relocating-to-the-netherlands-is-accelerating, accessed 16th September 2020

[12] Manisha Patel, ‘Eighty- two percent of UK businesses…’ https://thefintechtimes.com/eighty-two-percent-of-uk-businesses-believe-europe-is-key-to-future-expansion-but-nearly-half-have-felt-negative-impact-of-brexit/ accessed 16 September 2020

[13] European Communities Act 1972

[14] Human Rights Act 1998

[15] European Convention of Human Rights

[16] Anti- Terrorism, Crime and Security Act 2001

[17] Human Rights Act 1998

[18] ‘How will Brexit impact arbitration in England and Wales?’ (September 2016) https://www.nortonrosefulbright.com/en-gb/knowledge/publications/a655ac50/how-will-brexit-impact-arbitration-in-england-and-wales accessed 24 August 2020

CITE THIS WORK

Legal Maxim (October 26, 2020) Legal Implications of Brexit. Retrieved from https://www.legalmaxim.in/legal-implications-of-brexit/.
Legal Implications of Brexit.” Legal Maxim – October 26, 2020, https://www.legalmaxim.in/legal-implications-of-brexit/
Legal Maxim September 29, 2020 Legal Implications of Brexit., viewed October 26, 2020,<https://www.legalmaxim.in/legal-implications-of-brexit/>
Legal Maxim – Legal Implications of Brexit. [Internet]. [Accessed October 26, 2020]. Available from: https://www.legalmaxim.in/legal-implications-of-brexit/
Legal Implications of Brexit.” Legal Maxim – Accessed October 26, 2020. https://www.legalmaxim.in/legal-implications-of-brexit/
Legal Implications of Brexit.” Legal Maxim [Online]. Available: https://www.legalmaxim.in/legal-implications-of-brexit/. [Accessed: October 26, 2020]
AUTHOR DETAILS
https://i2.wp.com/www.legalmaxim.in/wp-content/uploads/2020/09/IMG_5302.jpg?resize=160%2C160&ssl=1

Name: Louice Woods

Affiliation: University of Greenwich 

Year: 3rd (L.L.B)

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