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Brexit: legal implications for businesses

Linkilaw Solicitors
Law firm focusing on the tech industry
17 December 2020
3 minute read

As the UK left the EU on 31 January 2020, and with the end of the transition period fast approaching, businesses should consider how their contracts and business may be affected from 1 January 2021.

While the Brexit outcome is still unknown, given no firm deal for a future trading relationship has been agreed on, here are some general, practical steps your business can take now in order to prepare from our partner, Linkilaw Solicitors.

Commercial contract considerations

Review existing contracts

A large number of commercial contracts will remain unaffected. However, you should take particular care to identify contracts under which the commercial bargain may be significantly different due to changes that may come into effect as a result of Brexit, such as new trade tariffs or changes in exchange rate, for example.

If it is likely that your contracts will become unprofitable or your services (or those of the other party) are no longer required post Brexit, you should now agree specific provisions in order to deal with this scenario, as it may be difficult to rely on existing termination clauses and/or force majeure.

It may be a good idea to negotiate now what will happen in the event of increased tariffs, potential delays, etc. and to amend contracts accordingly before 2021, rather than waiting until later.

English governing law and jurisdiction clauses

Although we have noted that contract law will largely remain unaffected as a result of Brexit, if you wish to enforce a UK judgement in an EU member state this may be more complicated, post January 2021.

If you have obtained a judgment or court order, you will want to enforce it in a jurisdiction where the judgment debtor has assets or is located.

Intellectual property considerations

Some of the key intellectual property rights and regimes that will be altered as a result of Brexit are:

EU Domains

UK businesses with .eu domain names should check they meet the required criteria or plan now for migrating their website over to a new domain (e.g. co.uk or .com) as from 2021 any existing .eu domain will be subject to withdrawal and revocation.

Trademarks and Registered Community Designs

Holders of existing European trademarks (EUTMs) and Registered Community Designs (RCDs) will automatically be granted ‘comparable UK trademarks’ on the UK register and a comparable ‘re-registered design’ to replace the UK coverage that is being revoked at the expiry of the transition period.

Those with ongoing applications for an EUTM or RCD will have a period of nine months from the end of the transition period to apply in the UK for the same protections.

Remain unaffected by Brexit.

Data protection considerations

The Information Commissioner’s Office (ICO) who regulates UK businesses in terms of data protection has confirmed that the GDPR will continue to apply to the UK and it will be transposed into UK law.

However, a decision is yet to be made in relation to transfers of personal data from the EEA to the UK.

The decision is currently unclear so especially in the case of large-scale processing or processing of sensitive personal data which will continue into 2021 it is prudent to put “appropriate safeguards” in place now.

One way of doing this is through contracts now through the use of standard contractual clauses (SCCs).

Next steps:

Measure the impact of Brexit in your business and don’t hesitate to get legal assistance if needed!

Our partners, Linkilaw Solicitors can help you renegotiate your commercial, futureproof your brand within the European Union, provide advice on employment and immigration and update your data protection processes and policies in light of Brexit. You can book an introductory call to discuss your legal requirements with them.

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