On 30 March 2017, the UK’s Department for exiting the European Union published a white paper outlining its proposals for a Great Repeal Bill (GRB). Whilst superficially, this appears to bring clarity to the legal position after Brexit, on closer examination the GRB proposal over-simplifies the position and glosses over the very significant legislative (and consequential business) problems that will arise from the UK’s departure from the EU in the absence of a comprehensive and detailed free trade agreement between the UK and EU to enable many of the existing business arrangements to continue. Whilst much of the press commentary has focused on the impact of Brexit on the financial services sector, the same issue, disruption of existing business models as a result of leaving the single market, arises in almost every other sector of the economy, and certainly in the telecoms, media and technology sectors.
In particular, the GRB white paper ignores the fundamental problem that cross-border issues cannot be dealt with by UK-only legislation, but will require agreement with the EU.”
Prime Minister May says in her foreword to the GRB that in her view: ‘The same rules and laws will apply on the day after exit as on the day before.’
The white paper then envisages a large, but quite mechanical, task of conversion of EU law into UK law, with delegated powers to deal with ‘correcting’ the operation of laws that will no longer function. However, in many cases it is simply not possible for the UK to ‘convert’ or ‘correct’ EU legislation to work post-Brexit without the explicit agreement of the EU and consequential changes to EU legislation.
Some simple examples relating to the telecoms, media and technology sectors clearly illustrate the problem: international mobile roaming, ‘country of origin’ rules for broadcasters, and cross-border data transfers. In each case, regardless of what the UK does to ‘convert’ or ‘correct’ its legislation, the EU legislation applicable in other Member States will treat the UK as being outside the EU post-Brexit unless amended by the EU prior to Brexit, with adverse consequences for businesses established in the UK.
- So far as international roaming is concerned, unless the EU updates the Roaming Regulation to include the UK (there is no obligation to so do), mobile operators in the EU will then be free to charge UK mobile networks the same (generally higher) wholesale roaming charges they apply to roaming from networks outside the EU. As commercial businesses, the UK mobile networks will then have little choice but to pass on the higher wholesale roaming charges to their customers.
- So far as ‘country of origin’ broadcast rules are concerned, once the UK leaves the EU, without modification of the Audio-visual Media Services Directive, UK-based broadcasters will lose their ability to rely on the provisions of the AVMS Directive which allow EU-wide broadcasting provided that the broadcaster comply with country of origin rules. Whilst there is a fall-back to the non-EU based European Convention on Transfrontier Television, this is more restrictive and the change may cause some international broadcasters to reconsider the best location for their European business.
- So far as cross-border data transfers are concerned, unless the Commission finds that the UK has an adequate level of protection (and it is under no obligation to do this in any particular timeframe) EU companies will need to put in place appropriate alternative safeguards (e.g. by means of contractual obligations or binding corporate rules) for cross-border data transfers to the UK post-Brexit.
In each case, there is simply nothing that the UK can do by means of unilateral UK legislation to fix these issues.
We will follow the progress of the GRB and the Brexit negotiations to see how these (and similar) issues are addressed.