Understand Your Rights. Solve Your Legal Problems
Responses from over 600 participants from 180 sectors revealed that almost 50% fear the biggest risk post-Brexit is added costs through duties or taxes, followed by customers and suppliers having a potential negative view of the UK (19%) and exchange rate issues (18%).
The Institute of Export (IOE) - the only professional body in the UK offering recognised, formal qualifications in International Trade - invited members, established exporters and importers and trade association members to take part in a post Brexit questionnaire and help shape how future trading should work.
Further results show that nearly 54% of those surveyed expect their business growth to remain the same with almost 47% projecting growth to shrink in the medium term - and over 42% forecasting a long-term growth decline.
Almost 47% of recipients say the current UK and EU customs procedures are suitable for UK traders. When asked what changes and developments they required in their respective business sectors, responses spanned free movement of goods between countries, financial support for new and established exporters - and clear information about regulations.
Nearly half rated continued access to the EU single market for goods and services as 10 on a scale where ten is most important.
When asked how UK export controls and licensing procedures can be made more user-friendly for their businesses, most said they were content with the current system and hoped the arrangements could remain on an EU-wide basis. However, there were calls to streamline the UK's system - with either IT enhancements or additional support making license application faster and more efficient. The need for help to navigate the procedures was also voiced.
On transit and security arrangements, the importance of any deal negotiated with the EU not having clauses that could delay shipments was also expressed. If the government failed to achieve this, the feeling is that it must proactively prevent UK exporters losing out by committing extra resources to lessen the impact of the new rules and speed up the process.
There was a noticeable difference between the needs of SMEs and larger organisations when it comes to the support they require. SMEs find it harder to access the resources needed to deal with the unavoidable administrative processes necessary to international trade. It is therefore the SMEs, who are the life-blood of UK business, who will feel the hardest impact of any increased financial or administrative burden imposed on the UK as a result of negotiations with the EU.
Additional results highlighted that in the medium term, almost 88% saw resolving the UK's trade relationship with the EU as a priority and that this should be dealt with before trying to enter into any new agreements with other nations or trading blocs.
Thereafter, Free Trade Agreements with USA (77%), Canada (62%), China (61%), Australia (57%) and India (51%) were seen as important medium term objectives.
When asked the same questions about the longer term perspective, India came out on top (61%) followed by Australia (56%), China (52%), Canada (48%), USA (44%) and the EU (42%).
IOE Director General, Lesley Batchelor OBE, said: "The results of the survey will inform and influence government and civil servants and we urge businesses to harness trade associations and business groups to continue to make their voice heard, tell them what they need to ensure that they can compete effectively in the global market - and let them know which regulations are stopping them from doing it properly or are impeding their companies' growth.
"While our relationship with the EU won't change overnight - and Brexit could now be delayed until 2019 - there is no time to waste as fallout from the vote won't wait for us to invoke Article 50. For example, many EU clients have profound fears and will need reassuring, while a number of other immediate uncertainties could bring benefits or extra costs - for example, short-term currency fluctuations.
"It is vital that businesses are aware of all this so they can resolve problems quickly and capitalise on opportunities."
(Source: Institute of Export)
The European Commission recently opened an in-depth probe to assess whether the proposed merger of Dow and DuPont is in line with the EU Merger Regulation. The Commission will investigate further whether the deal may reduce competition in areas such as crop protection, seeds and certain petrochemicals.
Commissioner Margrethe Vestager, in charge of competition policy, said: “The livelihood of farmers depends on access to seeds and crop protection at competitive prices. We need to make sure that the proposed merger does not lead to higher prices or less innovation for these products.”
The proposed merger between Dow and DuPont, both of the US, would create the world's largest integrated crop protection and seeds company. It would combine two competitors with leading herbicides and insecticides portfolios and with a strong track record of bringing innovative crop protection and seeds products to the market. It would also create a leading integrated producer of certain petrochemical products that are widely used in packaging and adhesive applications. The transaction would take place in industries that are already globally concentrated.
“The Phase II review is a common next step in the review process for a transaction of this size and scope under EU Merger Regulation. Under this regulation, Phase II generally provides the Commission with 90 working days to review the pending transaction. Dow and DuPont will continue to work constructively with the Commission to address their concerns and to obtain clearance for the merger, which we are confident will be achieved,” reads Dow’s press statement.
On June 22, DuPont and Dow began the formal process to obtain merger approval from the European Commission by submitting the required filing to obtain regulatory clearance in connection with the proposed merger of equals. Dow and DuPont continue to expect the transaction to close by year-end 2016, subject to satisfaction of customary closing conditions, including receipt of regulatory approvals.
(Source: Europa.eu + Dow)
New research from the Federation of Small Businesses (FSB) suggests half (52%) of small firms have been stung by unfair contract terms with suppliers, costing nearly £4 billion in the last three years.
Suppliers are failing to make auto-rollover clauses clear up front (24%), tying businesses into lengthy notice periods (22%), charging high early termination fees (20%) and concealing details in small print (20%).
Two in five (40%) respondents said they felt powerless to do anything about unfair contract terms because the supplier was too important or powerful to challenge. This highlights that small firms can be just as vulnerable as consumers when buying goods and services, and they need better protections.
Mike Cherry, FSB National Chairman, said: “Small firms on the bad end of a deal are losing out to the tune of £1.3 billion each year. We have identified persistent problems with suppliers, across sectors, treating small firms unfairly. This suggests the market is failing to deliver value for money products and services for small business customers.
“Small businesses don’t have the time, expertise or purchasing power to scour the market to find and negotiate the best deals. Small business owners behave in a similar ways to consumers, but they don’t have the same guarantees of quality or legal redress in an unfair situation.”
The FSB research, ‘Treating Smaller Businesses Like Consumers – Unfair Contract Terms’, sheds light on the scale of the problem, suggesting 2.8 million small firms have suffered because of unfair contract terms. Most (75%) of those affected had been stung twice or more in the past three years.
One in ten (11%) small businesses affected by unfair terms were set back by more than £5000 dealing with a single problem. Two in five (37%) lost more than £1000 through an unfair agreement with a supplier.
To drive change in this area, Government and regulators of energy, financial services and telecoms should more routinely and explicitly focus on small business vulnerabilities. Trading Standards should also be given the power to take action against suppliers imposing unfair terms.
Mike Cherry concluded: “If small firms were better protected when entering a contract with a supplier, they would have more confidence and trust in the market. Suppliers would be more accountable and businesses would spend less time and money dealing with the fallout. Tackling unfair contract terms would lead to a more efficient and competitive economy.”
(Source: FSB)
According to recent figures from the ONS, there were 3.8 million fraud offences committed last year. Fraud has become the most common crime committed in the UK. But when it comes to serious fraud – the big ticket crime committed by banks, companies and their employees – there is little serious data, only broad brush estimates. In combatting it, the Serious Fraud Office confines itself to taking on only the largest and most prominent criminal matters: just a few dozen cases each year.
All well and good. But does the SFO always play the game according to the rules, or has it been actively trying to shift the existing framework of the law to suit its own agenda? If that helps the successful investigation and prosecution of criminal conduct in the end, does this really matter?
One key area where the SFO has sought to redress the balance in its favour is legal professional privilege (LPP): a long-established legal principle which ensures that communications between clients and their lawyers remain confidential, facilitating the frank disclosure of information between them. It is a privilege belonging to clients, and which they alone can waive.
The SFO has said that assertions of privilege are not always properly made. Last year, SFO Director David Green QC, complained that some companies are obstructing investigations by hiding behind LPP, preventing access to all communications with their lawyers. He indicated that the SFO would be willing to make applications in the courts, both civil and criminal if necessary, to override privilege and gain access to relevant material.
He told ‘The Times’ that although it was not seeking to dispense with LPP, the SFO was preparing to target companies “whose lawyers obstructed investigations by hiding behind the shield of legal professional privilege. We believe that, in some instances, professional privilege is claimed artificially and, in cases where that is over a matter of importance to the investigation, we will pursue it.”
He added: “These companies call in outside lawyers, who make a lot of money by doing an investigation and are the first to interview key witnesses at the coal face, then claim privilege - it is absolutely ludicrous.” Lawyers, he added, were effectively “ploughing up the crime scene.”
In February, Barclays Bank, which had vigorously resisted legal attempts by the SFO via the courts to access communications the bank said were covered by LPP, eventually agreed to make them available. The SFO has been investigating Barclays for nearly four years over its 2008 payment of £322 million in advisory fees to Qatar Holdings, a subsidiary of Qatar’s sovereign investment fund. The Barclays' concession to release documents followed another High Court victory for the SFO in January over a challenge by Colin McKenzie to the way in which it handles the identification of material potentially subject to LPP.
Alun Milford, SFO General Counsel, recently clarified the agency’s position on LPP in a speech: “We have no interest in communications between client and lawyer on questions of liability or rights,” he said. “We are focused on the underlying facts, including the accounts of witnesses spoken to in corporate investigations. We do not regard ourselves as constrained from asking for them even if they are privileged…and our experience is that at least some corporates are not themselves constrained from letting us know what their investigators were told.”
Should we therefore be concerned if the SFO appears to want to sidestep LPP? The answer must be positive. These attempts come against the backdrop of the Investigatory Powers Bill, promoted by Theresa May whilst she was Home Secretary, which increases the surveillance powers not only of the police, but also other agencies including the SFO. The Bill is currently progressing through parliament, with various amendments tabled, but looks set to pass.
The government recognises that LPP, likely to be impacted by key elements of the Bill, is insufficiently protected by the draft legislation. A joint committee of the Bar Council and the Law Society has stated that there should be provision made “for the protection of LPP" and that the protection should be included in the Bill itself, not simply in and as part of a code of practice.
The widespread concern of lawyers is that giving greater investigatory powers to agencies such as the SFO may well undermine LPP, and prevent them from being able to assure clients that their communications are confidential. They say that the status quo should be preserved in the Bill, to ensure that clients have total confidence that they can communicate with complete candour and without fear of information being shared with a third party without their consent.
Indeed, recent guidance published by The Law Society shows the importance of LPP to the legal profession. LPP is variously referred to as “one of the highest [legal] rights”, a “fundamental common law right”, “precious” and “sacrosanct.” The guidance confirms that LPP is the right of the client, rather than the lawyer. This undermines David Green’s comments that lawyers themselves are abusing the “shield” of LPP. A lawyer who discloses privileged information without client consent “would be in breach of his professional duties,” and the Law Society opines that cases where abuses of LPP are proven are “few and far between.” In fact, contrary to the position taken by the SFO, it continues: "If clients justifiably assert their privilege… they should not in any way be criticised or penalised for doing so, nor regarded as being uncooperative – nor should their legal advisers.” This point is returned to repeatedly, the Law Society stating: “No regulator or investigator is entitled to pressure a client to waive LPP…no client can be criticised, let alone treated detrimentally… however helpful a waiver might be to the regulator or investigator” and “no adverse inferences should be drawn from a claim to privilege or a refusal to waive privilege.”
The legal profession generally is increasingly frustrated by attacks on LPP by the SFO and government. While it is important to thoroughly investigate and prosecute criminals successfully, investigatory agencies should not attempt to undermine or circumvent accepted legal practice simply to make their task easier. The original justifications for LPP have not changed. The government – in particular – should take note and ensure that appropriate statutory protection is given to LPP, stopping the erosion of and guaranteeing the rights of all of us, which are entitled to be properly protected.
(Source: Adam Rooney, Partner at Signature Litigation)
Legal firms’ call handling standards have come into question as the result of a major new study into telephone practice.
The research conducted by audio branding specialist PHMG, which audited 766 firms in the legal trade, discovered the large majority risk losing custom by subjecting customers to generic music and audio while on hold.
Typically, waiting on hold is seen as a major bugbear but 51% of legal firms still leave customers listening to nothing but generic music. A further 25% subject callers to beeps, while 18% leave them in silence and 4% force them to listen to ringing.
Only one per cent employ brand-consistent voice and music messaging - viewed as the best practice approach to handling calls – which is less than the national average of 2%.
Mark Williamson, Sales and Marketing Director at PHMG, said: “Call handling remains a critically undervalued element of customer service and marketing. A previous study of 1,000 UK consumers found 73% will not do business with a company again if their first call isn’t handled satisfactorily.
“Therefore, it is important companies do their utmost to improve the experience. The research shows there is still work to be done in providing an experience that keeps callers engaged and entertained.
“Generic music, beeps, ringing or silence convey a message that the customer is not valued, which will only serve to compound any annoyance felt as a result of being made to wait on hold.”
The research also found 96% of legal firms do not even use auto attendant messaging to greet customers who call up outside of normal working hours.
It also seems call handling standards have not significantly improved when comparing the results to a similar study conducted in 2013. The number of companies playing repetitive music has increased by 24% during that period and there has been a 2% improvement in the number using brand-consistent voice and music.
“The trends over the past three years suggest legal firms believe generic music is enough to keep callers entertained but this can actually have the opposite effect,” added Williamson.
“An existing, generic piece of music should not be repurposed to convey a message it was never intended to, as its characteristics may not match those of the company.
Hearing is one of our most powerful emotional senses so the sounds customers hear when they call a business will create a long-lasting impression. Every element of a music track, whether tempo, pitch or instrumentation, will stir different emotions so traders should ensure they convey the appropriate brand image.”
(Source: PHMG)
Solicitor Peter Watson-Lee, the Head of the Specialist Family Law Department at Williams Thompson Solicitors LLP in Christchurch, Dorset, has co-authored two influential legal guides. The national guides, which are the first official guides of their kind, have addressed the inconsistencies and a lack of knowledge surrounding the division of finances following divorce.
As the former Chair of the Law Society's National Family Law Committee, Peter was chosen to join a small group of legal experts whose aim was to address the concerns about financial division following divorce highlighted by the Law Commission. With his wide experience working at one of the region's leading family law practices, Williams Thompson Solicitors LLP, Peter helped develop the two innovative guides for the UK's Family Justice Council.
Peter Watson-Lee said: "These are the first ever official guides. The problem is that there are no clear rules as to how finances are to be divided when divorce takes place and individual Judges have a wide discretion. This has resulted in unacceptable regional disparities. In addition, the withdrawal of legal aid has meant that more and more people have to try to sort things out for themselves. This is why these guides are seen as so important"
Published by the Ministry of Justice, the first guide, titled ‘Sorting out Finances on Divorce,' is aimed at the general public and is intended to provide a fair and comprehensive reference in readable style. The second guide is aimed at the Judiciary and is titled "Guidance on ‘Financial Needs' on Divorce." It reviews the current law and how the parties' needs should be considered as well as looking at difficult issues, such as how long spousal maintenance should last. Gathering national attention, the first guide has already been used by Advice Now as the basis of their ‘Survival guide to sorting out your finances when you get divorced.'
Peter Watson-Lee said: "Lack of knowledge and misunderstandings as to the approach to be taken is one of the reasons why divorce can become so contentious. The anticipation is that these new guides will become a standard reference for both the public and the Judges and this will help narrow the disputes between divorcing couples".
(Source: Williams Thompson Solicitors)
A strict new copyright law will ensure extra protection for artists and designers from those attempting to rip off their designs, says Tayside solicitors and property agents Miller Hendry.
The law, which extends design copyright from 25 to 70 years, is aimed at preventing people and businesses producing replicas and knock-offs of the work of artists and designers.
s.52 of the Copyright Designs and Patents Act protected a designer’s work for 25 years after they die. It prohibited replicas of their work being made by an industrial process, or more than 50 being produced.
As a result of a recent Court of Justice of the European Union decision, s.52 was repealed, bringing UK law in line with EU regulations. That means designers and artists have protection for 70 years. Legal experts say that s.52 offered only limited protection and as a result was rarely used to enforce the rights of designers.
Alan Matthew, partner with Miller Hendry, commented: “The change in copyright law means works are now protected for 70 years after the death of the designer. Increasing protection to 70 years now gives designers protection back to 1950s. This brings design protection in line with standard copyright protection for literature and music.
“Stockists of replicas of protected designs have 6 months to sell, destroy or remove stock from the market. All replica stock which breaches the new rules must be gone by 28 January 2017.”
(Source: Miller Hendry Solicitors)
In the aftermath of the vote for Brexit, it transpires that there is actually no such thing as a Brexit, but potentially a number of Brexits that we could end up with.
In theory we could negotiate a Brexit where the UK leaves the EU but does not sever its ties to the EU’s ‘four freedoms’. By retaining its commitment to the freedom of movement of capital, goods, services and people, the UK could become a member of the European Economic Area (EEA). We could have the same status as Norway, Iceland and Liechtenstein as non-EU members that are able to access the EU’s single market.
However as reducing immigration played such a large role in the recent Leave campaign it is likely the Government will attempt to restrict free movement of people in its negotiations with the EU. This seems like a sensible assumption especially in light of Theresa May’s recent comment that there would be no attempt to re-join the EU by the back door. This means the prospect of the UK joining the EEA is likely to be off the table from the outset.
This leaves the UK with a couple of other possibilities. Switzerland’s relationship with the EU is a possible example of what a post Brexit UK-EU relationship could look like. However this model is also fraught with problems. Switzerland currently has access to the European single market as a result of a series of bilateral agreements with the EU which include unrestricted immigration for EU nationals which it has recently attempted to renegotiate. Switzerland has been warned by the EU that it will lose access to the single market if it goes ahead with any limitations. This does not bode well for any UK advocates of this scenario.
However all is not lost as there is a precedent for a free trade agreement that gives access to the EU single market without full adherence to the principle of free movement in the shape of the bilateral free trade agreement between Canada and the EU (CETA). The agreement has been cited as an example of what future UK-EU trade relations could look like by both Boris Johnson and the new Brexit minister David Davis.
Canada’s international trade minister Chrystia Freeland has stated that she expects the new CETA deal to come into effect in early 2017. The implementation of CETA would mean that all tariffs on industrial products will be lifted between Canada and the EU as will nearly all tariffs on agricultural products. To secure this deal Canada has agreed to accept free movement of people between itself and most of the EU member countries; Bulgaria and Romania are excluded.
However Canada’s access to Europe’s single market of course falls far short of the access that the UK currently enjoys as a member of the EU. For example, the CETA agreement only grants limited access for the Canadian financial services industry. Considering how reliant the UK is on its own financial services industry (with the UK exporting over £22 billion worth of financial services to the EU in 2014) a similar deal is far from ideal for the UK economy.
Although the CETA negotiations were concluded in 2014, its implementation has been put at potential risk by Bulgaria and Romania’s announcement that they would be vetoing CETA. The UK, if it chooses to go down this route, could risk finding itself in a similar position down the line. One member state could object during the ratification process and potentially scupper the whole deal.
Ultimately what may help the UK negotiate itself a better deal than Canada is the fact that the UK’s economy is more integrated into the European economy than Canada’s. The UK currently absorbs a huge 16% of the EU’s exported goods. Furthermore 1.2 million British people live or work in the EU and over 3.3 million EU citizens live or work in the UK.
Clearly whichever path the UK takes, the economic needs of both Britain and the EU will have to be fully considered in any future negotiations. Any bad moves on either the principle of the free movement or restricting the UKs access to the single market risk hurting both the UK and Europe in which case no one wins.
(Source: Caron Pope, Managing Partner at Fragomen)
The UK Government's Digital Economy Bill, which is set to revamp current copyright legislation and was introduced in Parliament last week and now clear of its First Reading, has been welcomed by the Federation Against Software Theft.
Julian Heathcote Hobbins, General Counsel, FAST, stated: “One of the most important changes outlined in this Bill from the perspective of the software sector is the increased maximum sentences for online copyright infringement. The draft of the Digital Economy Bill published extends the current prison term from two to ten years. The relevant part amends the Copyright, Designs and Patents Act 1988, and simply replaces the word two with ten.”
In its submission in the Consultation phase FAST stated: “We support effective and dissuasive sanctions including against the commercial copyright pirate who “infringe the rights of copyright holders for large-scale financial gain”. However, it should be noted that FAST Industry members remain cautious on the use of the criminal law so that those who are vulnerable or who infringe unwittingly are not targeted. “
The Digital Economy Bill includes a range of measures in support the Government’s stated aim of driving the digital economy, including:
Parliamentary Under Secretary of State for BIS and Minister for Intellectual Property, Baroness Neville-Rolfe said: "The UK is rightly known worldwide as home to some of the world’s most innovative and creative businesses, many for whom IP is key to their success. These measures strengthen the IP framework, ensuring the UK remains a great place to innovate and do business.”
Heathcote Hobbins added: “While the Bill aims to strengthen the UK copyright framework and bring criminal penalties for online and physical copyright infringement into line with the traditional copyright regime it is important to stress that this does not intend to criminalise people who are downloading content.”
“Criminal infringement only applies to making the material available to others. However, copyright owners can take civil legal action against individuals who download infringing material and they could be liable for substantial costs.”
FAST has been lobbying on behalf of copyright holders for this update for a long time. It is the industry’s contention that harsher penalties are needed to deter people from committing large-scale copyright infringement, and we are delighted the Government agrees with.
About The Federation Against Software Theft
IP underpins the investment made in software products enabling use of these products through a licensing regime in the UK and internationally. A stable, assured and certain IP anchor ensures obtaining the finance to enable investment in the software development lifecycle.
FAST aims to reduce, restrict and or lessen the incidence of unauthorised dealings in computer software. It works with its members, law enforcement communities (trading standards officers and local police forces), to detect and combat the sale of infringing software and it also helps organisations regularise their software estates when reports of possible misuse or under-licensing have been received about them.
(Source: fast.org.uk)
The average number of new tax cases sent to the Court of Justice of the European Union (CJEU) has risen by a fifth since the credit crunch, as more businesses and other taxpayers use the court to challenge the actions of national tax authorities, says Pinsent Masons, the international law firm.
Pinsent Masons says that between 2005 and 2010, pre-credit crunch, there were 50 new tax cases per year on average brought to the ECJ. Between 2011 and 2015, this rose to 61 per year, an increase of 22%.
Pinsent Masons explains that since the credit crunch, national tax authorities across Europe have been under intense pressure to increase revenues, leading many to levy extra charges and ensure they maximize tax take wherever possible. Businesses and other taxpayers who believe they are being taxed unfairly in the process, contrary to principles of EU law, can bring a challenge to the CJEU.
Pinsent Masons explains that the CJEU has ruled in favour of business claimants against national tax authorities in several high-profile cases, enabling millions in overpaid tax to be re-claimed.
Andrew Scott, Director at Pinsent Masons, the international law firm, comments: “The reach of EU law has widened considerably and continues to do so, with the result that an increasing amount of UK tax law is affected. More businesses and other taxpayers have therefore managed to find grounds for challenging UK tax law.”
“EU law has been used to contest a range of taxes levied by member states. EU anti-discrimination rules were used to over-rule the UK’s tax treatment of dividends paid by foreign subsidiaries of UK companies, for instance. It was argued that, in contravention on EU single market rules, they were being taxed more heavily than dividends from UK subsidiaries.”
Brexit vote result could mean further rush of tax cases to CJEU
Pinsent Masons says that the prospect of withdrawing from the EU, following the result of the EU referendum, means that more claimants may want to commence their proceedings while it is clear that EU law still applies in the UK.
Andrew Scott adds: “Although it’s business as usual at present, Brexit means that the power of the CJEU over UK law will end but at an unknown time in the future. UK claimants will therefore be considering whether to launch proceedings now so as to increase the likelihood that their claims are protected as and when the UK does leave the EU.”
“UK claimants might be concerned that, once it is out of the EU, the UK government will attempt without notice- as they have in the past- to remove the ability to bring a claim based on EU grounds even where EU law applied at the relevant time.”
(Source: Pinsent Masons)
