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Since the end of free movement between the UK and France following Brexit, UK citizens face new immigration requirements when moving to France. The changes have made it more challenging for UK nationals to relocate, but understanding the visa and residence permit processes can help make the transition smoother. In this article, we’ll discuss the visa requirements for UK citizens planning to move to France and the key changes since Brexit.
Before Brexit, UK citizens had the right to live, work, and travel freely in France and other EU countries. However, the conclusion of free movement has significantly changed the way UK nationals are treated in France. As of January 1, 2021, UK citizens are now considered third-country nationals in the EU, meaning they no longer enjoy automatic rights of residency.
Here’s a breakdown of what you need to know if you plan to move to France after Brexit.
UK citizens can visit France for up to 90 days within any 180-day period without needing a visa. This applies if you are:
If your stay is within the 90-day limit, you won’t need a visa. However, keep in mind that the 90-day allowance applies to the entire Schengen Area. So, if you've spent time in other Schengen countries, it will count towards your 90-day total. You must also ensure your passport is valid for at least three months beyond your planned departure from France.
If you wish to stay in France for more than 90 days, you will need to apply for a long-stay visa (VLS-TS). This applies whether you are moving for work, study, family reunification, or other reasons. UK nationals no longer benefit from the freedom of movement and will need to follow standard immigration procedures for non-EU citizens.
Here’s a breakdown of the main long-stay visa categories:
If you are planning to work in France, you will need a work visa. To obtain a work visa, you must secure a job before your move to France. Your employer will need to submit a request for a work permit, and you will need to provide evidence of your qualifications and the role you’re being hired for.
For UK nationals wishing to study in France, a student visa is required. You’ll need to provide proof of enrollment in a French educational institution, evidence of sufficient financial resources to support yourself, and possibly proof of accommodation.
If you are married to or a close family member of a French citizen or a legal resident, you may be eligible for a family reunification visa. This visa allows you to join your family member in France, but you will need to provide proof of your relationship and meet certain financial requirements.
If you are retiring to France, you will need to apply for a retirement visa, demonstrating sufficient financial means to support yourself without relying on public funds.
This visa is for individuals who wish to live in France for an extended period without working. This could be ideal for those who wish to retire, stay with family, or enjoy an extended holiday. You must show proof of income or financial resources to support yourself.
If you were working in France prior to January 1, 2021, and continue to work across multiple EU countries, you may be eligible to apply for a frontier worker permit. Known as a "document de circulation", this permit is free of charge and allows you to continue working in France while living in another EU country. It is essential that you apply for this permit through your workplace’s Prefecture.
If you are married to a UK national who is living in France and has obtained the Withdrawal Agreement Residence Permit (WARP), you may be able to join them in France under specific circumstances. However, if your British partner did not benefit from the WARP, you will need to apply for a Schengen entry visa to join them in France. The visa will be processed free of charge if you can demonstrate a genuine relationship with the British national.
Non-EU nationals living in the UK must also meet additional visa requirements, including the need to apply for an Airport Transit Visa if traveling through an airport in the Schengen Area.
While many aspects of immigration have changed for UK nationals post-Brexit, some things remain the same:
The Withdrawal Agreement Residence Permit (WARP) allows UK citizens and their families who were living in France before January 1, 2021, to continue residing, working, and studying in France post-Brexit.
The WARP grants continued residence rights, including healthcare and social security benefits in France.
Moving to France as a UK citizen now requires careful planning due to changes brought about by Brexit. While UK nationals can still visit France for short stays without a visa, longer stays, work, and family reunification will require a long-stay visa. Be sure to check which type of visa you need based on your purpose for moving and apply well in advance.
If you are uncertain about your specific circumstances or need assistance with the visa application process, consulting an immigration lawyer or visa specialist can be a wise choice to ensure your move to France goes smoothly.
For more information please follow French government’s entry requirements.
Nigel Farage delivered a surprising political forecast on Friday 17 January, asserting that he will ascend to the position of Prime Minister of Britain before the year 2030.
During a well-attended event in Washington DC organized in his honor, the Reform Leader was celebrated by Republican attendees as a prospective Prime Minister. He addressed the audience with a view of the White House, stating that Donald Trump's triumph represents not only a success for America but also for the free world at large. Mr. Farage emphasized that comparable movements are currently emerging across Europe, including in the United Kingdom.
Nigel Farage is a name that divides opinion in British politics. To some, he is a visionary who spearheaded the campaign for Brexit and fundamentally reshaped the UK’s political landscape. To others, he is a divisive figure, known for his blunt rhetoric and controversial views. However, despite the polarisation surrounding him, there is a compelling argument to be made for why Nigel Farage should be the next Prime Minister of the United Kingdom. His experience, populist appeal, and unwavering commitment to national sovereignty, alongside the growing dissatisfaction with the current political system, make him a candidate worth considering.
Farage’s political journey has been one of persistence and gradual influence. He first entered the political sphere with the UK Independence Party (UKIP), which was, at the time, a fringe party. UKIP’s primary focus was to advocate for the UK’s withdrawal from the European Union, a cause that Farage believed was essential for the future of the nation. Under his leadership, UKIP grew from a small group of disillusioned voters to a significant political force.
Farage’s ability to lead UKIP through difficult times and to maintain his position as the figurehead of the party demonstrated his political acumen. His understanding of the electorate, his ability to communicate directly with the public, and his tenacity in the face of adversity were qualities that would later serve him well in the battle for Brexit.
Farage’s leadership of UKIP culminated in the 2014 European Parliament elections, where the party achieved a historic victory. UKIP topped the polls in the UK, and Farage was lauded for his ability to galvanise voters and draw attention to the issue of the UK’s membership in the European Union. The results were a clear sign that there was a large section of the British public that was dissatisfied with the status quo and yearned for a leader who would take action on their concerns.
If there is one issue that has defined Nigel Farage’s political career, it is Brexit. Farage was not only a staunch advocate for leaving the European Union, but he was also one of the most prominent voices in the successful campaign to leave. The 2016 referendum on EU membership marked a pivotal moment in British politics, and Farage played a crucial role in shaping the debate.
The Brexit campaign, led by Farage and his allies, argued that the UK’s membership in the European Union undermined the nation’s sovereignty, control over its borders, and ability to make independent decisions. The "Leave" campaign resonated with millions of voters who felt that their voices had been ignored by the political establishment. Farage was able to tap into this frustration and communicate it to the wider public, presenting himself as a champion of the people against the elite.
The victory of the "Leave" campaign was, in large part, due to Farage’s leadership and his ability to rally voters who were sceptical of the EU. The result of the referendum—52% of voters chose to leave the EU—shocked the political establishment, but Farage remained steadfast in his belief that the UK was better off outside the European Union.
While the Brexit process has been fraught with challenges and disagreements, Farage’s influence on the outcome cannot be overstated. He was instrumental in shaping the national conversation around Europe, and his dogged determination in the face of opposition helped push the issue to the forefront of British politics.
One of the reasons that Farage has gained such a devoted following is his ability to connect with ordinary people. Unlike many of his political peers, who are seen as part of the establishment, Farage has cultivated an image of being an outsider—a man of the people. He speaks directly to his audience, often using blunt language and adopting a no-nonsense approach that appeals to voters who feel that their concerns are ignored by the political elite.
Farage’s populist appeal has been a central feature of his political career. He has consistently positioned himself as a champion of the working class, focusing on issues such as immigration, national sovereignty, and the erosion of British culture and identity. In an era of growing disenchantment with traditional politics, Farage’s rhetoric has struck a chord with many voters who feel disconnected from the political class.
His ability to speak to the concerns of ordinary people is perhaps best exemplified by his comments during the Brexit campaign, where he highlighted the impact of immigration on local communities and the need for the UK to take control of its borders. Farage’s willingness to discuss sensitive issues that many politicians avoid has earned him both admiration and criticism, but it has undeniably solidified his place as a leader of the populist movement in the UK.
If Farage were to become Prime Minister, his vision for the future of the UK would undoubtedly be shaped by his long-standing beliefs in national sovereignty, free markets, and the importance of individual freedom. His advocacy for a smaller government, lower taxes, and a free-market economy is in line with traditional conservative principles. Farage has consistently argued that the UK should focus on its own interests rather than being beholden to international agreements or bureaucracies, such as the European Union.
At the heart of Farage’s political ideology is a belief in the importance of national sovereignty. His argument for Brexit was based on the idea that the UK should be free to make its own laws, control its own borders, and pursue policies that are in the best interest of the British people. As Prime Minister, Farage would likely prioritise policies that restore the UK’s independence from international organisations and focus on promoting national interests.
Additionally, Farage has long championed the idea of a “Global Britain” post-Brexit. He envisions a UK that is free to forge its own trade deals with countries around the world, independent of EU restrictions. Under his leadership, the UK would likely focus on building strong trade relationships with emerging markets, while also strengthening ties with traditional allies such as the United States and Commonwealth nations. Farage’s vision of a post-Brexit Britain is one where the country is economically competitive, globally connected, and politically sovereign.
One of the most compelling reasons to consider Farage for Prime Minister is his ability to represent the growing number of people who feel disenfranchised by the current political system. The UK’s political establishment has been under increasing scrutiny in recent years, with many voters expressing frustration at the failure of mainstream parties to address their concerns.
Farage has consistently positioned himself as a voice for the voiceless, speaking for those who feel that their concerns have been ignored by the political elite. His populist rhetoric, which emphasises the importance of listening to the people and challenging the establishment, resonates with voters who are tired of the status quo. Farage’s ability to tap into this disillusionment has made him a powerful force in British politics, and his influence is only likely to grow as more people seek an alternative to the traditional parties.
Farage has also been vocal in his criticisms of the media, which he believes plays a significant role in shaping public opinion and perpetuating the political establishment’s narrative. He has often accused the media of bias and of failing to represent the views of ordinary people. This anti-establishment stance, combined with his willingness to speak his mind, has endeared him to many voters who feel that the mainstream media is out of touch with their concerns.
While there are many reasons why Nigel Farage could make an effective Prime Minister, there are also significant challenges that he would need to overcome. One of the biggest hurdles is the need to unite a fractured political landscape. The UK’s political parties are deeply divided, and Farage would need to find a way to bridge these divisions and create a government that is capable of governing effectively.
Farage’s history of leading smaller parties, such as UKIP and the Brexit Party, could be seen as both an asset and a liability. While his leadership of these parties has demonstrated his ability to build and lead political movements, it also highlights the challenges he faces in gaining the support of a wider electorate. For Farage to become Prime Minister, he would need to attract support from not only the populist right but also more centrist voters who may be sceptical of his approach.
Another challenge for Farage is his controversial reputation. His outspoken views on issues such as immigration, the European Union, and political correctness have earned him a great deal of criticism. For some, his rhetoric is seen as divisive, and his style of politics is viewed as inflammatory. Farage would need to address these concerns and present himself as a leader who can unite the country, rather than deepen divisions.
After an earlier fall out this month, Nigel Farage has said he wants to "mend fences" with Elon Musk, after the billionaire Trump adviser called for him to be replaced as leader of Reform UK. Just before Christmas, Farage told journalists that his party was in "negotiations" with Mr Musk, the world's richest man, about a potential donation.
However, by the new year, the relationship had soured, with Tesla boss Mr Musk stating that Farage "did not have what it takes" to lead the party.
Farage suggested that the rift was due to a disagreement over Mr Musk’s support for the jailed far-right activist Tommy Robinson. Speaking on LBC, Farage explained that he planned to repair his relationship with Mr Musk during a forthcoming "four or five" day trip to the US for Donald Trump's inauguration as president on 20 January.
"Of course I want his support, of course I will talk to him in America in a few days' time, of course I want to mend any broken fences that might exist," he said.
"I have no desire to go to war with Elon Musk and I'm not going to, and I haven't done," he added. "I'm a huge admirer of him - I think he's an heroic figure."
He reiterated his belief that losing Mr Musk's support would damage the party’s chances with younger voters, as the tech entrepreneur was "a cult hero figure" and "he kind of makes us look cool."
However, Farage made it clear he "would not be moved" over Mr Musk’s call to free Tommy Robinson, whose real name is Stephen Yaxley-Lennon. Robinson was jailed in October last year for repeating false claims against a Syrian refugee.
The Reform UK leader said many of his "American friends" had only "seen one side of the Robinson story" and were unaware of Robinson’s criminal record.
"He has been in prison many times over the years... Once he almost brought down a trial at which gang rapists were ultimately convicted," Farage said.
He added that embracing Robinson would do Reform UK "immense harm, and probably rightly so."
However, Farage insisted that Mr Musk’s backing was "not crucial" and suggested the falling out with the billionaire could ultimately benefit Reform UK in the future.
He added: "The fact that I've stood up on a point of principle - even if in the short term it's to my detriment - in the long run may even work in our favour."
For Nigel Farage to become the next Prime Minister of the UK, he must navigate several significant challenges. First and foremost, he needs to unite the fragmented right-wing of British politics. While Farage has a loyal following among populist voters, particularly those who supported Brexit, he must consolidate support from other factions on the right. This includes gaining the backing of groups such as his own Reform UK, UKIP, and potentially appealing to dissatisfied Conservative Party voters. To do so, Farage would need to forge strategic alliances and present a clear alternative to the more centrist leadership currently in place.
Expanding his appeal beyond his traditional populist base is another crucial step. Farage has a strong following among those who feel disillusioned with the establishment, but for him to secure the role of Prime Minister, he must broaden his support. This means attracting centrist and moderate left-leaning voters who may not be swayed by his strong stances on issues like immigration or political correctness. To do so, Farage would need to adjust his rhetoric, toning down some of his more divisive views and positioning himself as a leader who can represent all sections of British society.
Building a strong and influential political party is essential for Farage’s chances of becoming Prime Minister. Reform UK, or any political vehicle he uses, must gain substantial representation in Parliament. This means securing more Members of Parliament and forming a credible opposition to the Labour and Conservative parties. Farage must continue to strengthen Reform UK and develop a comprehensive policy platform that addresses the key concerns of the electorate, such as healthcare, education, and the economy. Without a solid political foundation, Farage’s path to Downing Street would be tenuous at best.
Farage must also present clear, pragmatic policies on the pressing national issues that will resonate with voters. His leadership in the Brexit campaign has defined his political career, but now he needs to show that he can govern on a range of other topics. For many voters, issues such as the post-Brexit economy, healthcare, and national security are paramount. Farage needs to develop well-thought-out policies on these matters that can convince the public that he is the right person to lead the country beyond Brexit.
Managing his public image will be critical for Farage, especially given the criticism he has faced for his divisive rhetoric. His blunt, combative style has alienated some potential supporters who see him as too extreme. If Farage is to broaden his appeal, he must tone down his more controversial statements while still maintaining his strong stance on issues like national sovereignty and immigration. Balancing his populist appeal with a more moderate image will be a delicate task but is necessary if he hopes to attract undecided voters and those wary of his extreme views.
One of Farage’s key advantages is the growing disillusionment with the political establishment. Many voters feel that traditional political parties, including Labour and the Conservatives, no longer represent their interests. Farage can tap into this anti-establishment sentiment by positioning himself as an outsider who understands the frustrations of ordinary people. By continuing to challenge the political elite and advocating for the concerns of the public, Farage could further galvanise support and create a sense of momentum for his leadership bid.
Finally, Farage would need to run a highly effective election campaign. His ability to galvanise support in the lead-up to Brexit demonstrated his political acumen. Farage must replicate this success by targeting key constituencies, crafting a compelling and unified message, and engaging in grassroots mobilisation. Raising funds, gaining media coverage, and building a broad coalition of voters will all play a critical role in securing a path to the Prime Minister’s office.
To become Prime Minister, Farage must overcome several hurdles, including uniting right-wing factions, broadening his appeal, and presenting a practical, unifying vision for the UK’s future. While these challenges are considerable, with the right strategy, policy platform, and public image, Farage could rise to lead the country. However, whether he can navigate these obstacles remains to be seen.
We hear from Doyle Clayton partner Malini Skandachanmugarasan, a leading lawyer in the UK immigration space, on the various avenues available to overseas talent – and how the UK can make itself more attractive to investment and aspiring businesspeople from abroad.
We tend to discuss the following categories:
Innovator Founder – This new category combined and replaced the Start Up and Innovator categories. It is designed for entrepreneurial talent looking to establish an “innovative, viable and scalable” business in the UK, where the individual has generated or significantly contributed to the idea.
The applicant must obtain an endorsement from a Home Office-approved endorsing body which assesses the prospective business against the “innovative, viable and scalable” criteria. As part of this, applicants must provide an original business plan showing how the business meets market needs, the skills held to set up and run the business, and scope for job creation in domestic and international markets. Applicants must also provide evidence showing they have access to sufficient funds to start the business in the UK. Successful individuals should be eligible for settlement after holding permission for a period of three years.
Global Talent – This category is not specifically for entrepreneurs, as all types of work arrangements are permitted. It can be used by highly skilled individuals who are leading or upcoming talents in the field of science, engineering, humanities, medicine, digital technology or arts and culture. There is another endorsement process with significant supporting evidence required demonstrating track records in innovation, recognition in their field of work, significant technical, commercial or entrepreneurial contribution, and/or exceptional ability by academic contributions. Depending on the type of applicant, the route to settlement can consist of a three- or five-year qualifying period of residence in the UK.
UK Expansion Worker – This category falls under the umbrella of the Global Business Mobility category, replacing the ‘Overseas Representative of a Business’ category (known as the Sole Representative). The route targets international businesspeople with a successful business overseas and wishing to expand in the UK by setting up a branch or subsidiary and temporarily assigning senior and specialist employees to commence operations. The relevant business must have minimal presence in the UK with no trading activities or operations having yet started.
Applicants are required to provide evidence of historical trading overseas and of their intentions for the UK business. This category is treated as a stepping stone for businesses to start operations in the UK so that they can then obtain a Skilled Worker sponsor licence, enabling them to employ overseas nationals. The temporary nature of this type of sponsorship, alongside the fact that it is not a route to indefinite leave to remain (settlement), makes this category a last resort option for experienced entrepreneurs.
The costs of going through the UK immigration process can be obstructively high for start-ups and newer entrepreneurs. Home Office fees are significantly higher than similar economies and there may also be minimum funds requirements individuals must satisfy. Additionally, many of the categories used by entrepreneurs do not have priority processing services and therefore processing can take a number of months. We recommend seeking early advice on suitable UK immigration categories, requirements and processes so that individuals can plan accordingly ahead of a move to the UK.
The costs of going through the UK immigration process can be obstructively high for start-ups and newer entrepreneurs.
The Home Office has grown more suspicious of fraudulent entrepreneurs and has sought to address this by introducing ‘genuine requirements’ as a part of decision-making. Application of this requirement varies significantly between caseworkers, meaning that applicants need to be prepared to frontload their applications from the outset. Ill-prepared applications that do not provide sufficient evidence are likely to result in an unnecessary refusal.
Once in the UK, new businesses and entrepreneurs can face time-consuming administrative and practical obstacles. Despite the process of registering a business being fairly straightforward, obtaining a UK bank account and individual and business registration with the UK tax authorities can be a long process, which affects how quickly the business can establish itself and start growing. Awareness of the relevant timeframes will help in the early stages of the business planning for the UK.
The combination of Brexit ending free movement of EU nationals and significant changes to the Immigration Rules, making immigration routes more onerous and restrictive, has made the UK less attractive to international entrepreneurial talent.
Immigration is seen as a hot topic by politicians and the media. Over my years of practice, the perception of an immigrant has become increasingly misunderstood and negative. A prime example is the discussions on immigration in the lead-up to Brexit. Recent stances taken by UK governments could deter talent from moving to the UK where they face high visa fees, restrictive immigration conditions and administrative obstacles in establishing businesses. The Immigration Rules also change frequently, causing confusion to individuals who may have entered the UK under one category only for it no longer to exist by the time they qualify for settlement.
Nevertheless, the UK is still considered an attractive option for businesspeople. With a high-spending consumer market and multicultural, highly talented individuals in addition to the language, geographical position and funding environment for start-ups and new businesses, it is understandable why the UK is considered a business-friendly country. The interest from the international business community is clear, but the UK immigration requirements can be a major obstacle deterring exciting and creative individuals and business from setting up here.
UK immigration policy is constantly evolving. Given the effects of more recent changes for businesspeople and entrepreneurs, we need to consider ways to make the UK an attractive place to incentivise talented individuals to relocate, invest and work here.
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This could be through making existing categories more wide-reaching to the range of talent covering numerous sectors (without a focus on digital technology) and introducing clearer information regarding the eligibility criteria and process for categories, such as the Global Talent and Innovator Founder categories. The UK could also build on its connections with other countries by introducing easier routes to highly skilled individuals or entrepreneurs who have had their talent recognised through the grant of specific immigration permission in other jurisdictions.
From a practical perspective, there is an urgent need to introduce quicker processing times and priority services. Current processing times can be months-long, which simply does not align with the pathways of start-ups and new businesses. Consideration should also be given to whether the high visa costs, which can be crippling to start-ups and SMEs, and existing eligibility criteria for settlement and British citizenship align with the purpose of attracting and retaining exceptional individuals. Despite already having higher visa fees than many other economies, the government’s intention to increase visa costs across the board by 15% to 20% will only add to the existing impact of rising immigration costs and limit the ability of enthusiastic, innovative and gifted founders and entrepreneurs to consider the UK.
The UK has the fundamental structure of being a country of opportunity and growth to foreign-born talent and entrepreneurs. It needs to engage urgently with practitioners and the business community to ensure that a transparent and positive system is implemented to attract exceptional people from all sectors without bureaucratic hurdles.
Malini Skandachanmugarasan, Partner
One Crown Court, Cheapside, London, EC2V 6LR, UK
Tel: +44 02073 299090 | +44 07789 685534
E: mskandachanmugarasan@doyleclayton.co.uk
Malini Skandachanmugarasan is a partner at Doyle Clayton and leads the firm’s personal and private client immigration practice. She is recognised as one of the UK’s leading immigration lawyers, advising both organisations and individuals, specialising in UK immigration law, nationality law and European law. Her expertise enables her to service clients ranging from global corporates and innovative tech leaders to families, overstayers and those seeking protection in the UK. She is individually ranked in legal directories and is described by peers as being ‘at the top of her game and one to watch in the market’.
Doyle Clayton offers legal and advisory support to clients on issues arising in the workplace and provides realistic and effective solutions on employment, immigration and corporate and commercial law issues. It has experience in dealing with most sectors and industries in the UK and its clients include start-ups, SMEs, family-owned businesses, multinational corporates and private individuals. As a result, it can use its substantial experience and industry expertise to advise businesses and individuals on a range of employment, UK immigration and corporate law issues.
Instated as part of the Brexit deal, the Northern Ireland Protocol creates a trade border between Northern Ireland and Britain. It has been appealed by uninionist politicians who have claimed that this conflicts with the 1800 Act of Union, which states that all UK nations should be treated equally in matters of trade, and the Northern Ireland Act 1998, which prohibits the alteration of Northern Ireland's constitutional status without a referendum.
That appeal has now been unanimously rejected by the court, which agreed that the protocol did conflict with the Act of Union but added that it was Parliament's will that any part of the Act that conflicted with the protocol be suspended.
In response to the ruling, Democratic Unionist Party (DUP) leader Jeffrey Donaldson said a solution to the protocol was "never going to be found in the courts”, adding that the Brexit trading arrangements remained “an existential threat to the future of Northern Ireland’s place within the union”.
Speaking with the BBC, a UK government source added that there was "lots still to work through" in negotiations concerning the protocol.
In this article we hear from four Loyens & Loeff team members specialising in insolvency and restructuring matters, who take a look at the corporate insolvency fallout for Luxembourg specifically. How have Schemes and restructuring plans been impacted by the UK’s exit from the EU, and what has it meant for enforceability of judgements?
In Luxembourg (as in many other EU jurisdictions) there is no specific legal framework on automatic recognition of UK judgements following Brexit. That is to say, there is no replacement or equivalent to the previously applicable: (i) EU Insolvency Regulation, (ii) Brussels Recast Regulation on recognition of judgments, and (iii) recognition in certain circumstances where the Hague Convention would typically not apply. The consequences have a significant effect on the use of certain previously common restructuring tools such as the UK Scheme of Arrangement and, more recently, the UK Restructuring Plan.
Whereas Schemes and other UK processes were commonly used to restructure debt prior to Brexit, their use has become less common post Brexit due to this lack of automatic and direct enforceability. The UK restructuring processes can still be used, but their scope of use is now limited, it being noted that parties need to undertake a more detailed factual analysis as to the need for enforceability of the UK judgement in the specific matter and associated risks as to lack of direct enforceability.
Post-Brexit, it appears from practice that a Scheme or other UK restructuring process is limited to use on debt governed by English law only and only with respect to the contractual nature of the debt. This is a change from past practice, where the UK processes could also be used to order positive actions as against the debtors. As positive actions against the debtor require immediate enforceability of the judgement for them to be effective, these positive actions would appear to be no longer viable, thereby limiting the scope of applicability of the Scheme.
As to market trends as a result of Brexit: (i) the overall use of Schemes has decreased, (ii) other restructuring processes in EU countries are considered as options in far more detail (such as the German or Dutch restructuring processes), and (iii) the scope of the Schemes has been reduced to and generally limited only to contractual debt matters.
Whereas Schemes and other UK processes were commonly used to restructure debt prior to Brexit, their use has become less common post Brexit due to this lack of automatic and direct enforceability.
The UK restructuring procedures, however, remain very practical and the UK Courts have significant experience in debt restructuring, making it an objective of parties to attempt to fit facts and circumstances to try and still use these processes. One such trend is the growing popularity of attempting to create a co-obligor structure following the Gategroup model to limit recognition issues.
English Schemes of arrangement (voluntary pre-insolvency proceedings) are not considered to be insolvency proceedings. As a result, prior to the Brexit transposition deadline such orders were generally automatically recognised in the EU under the Brussels Recast Regulation.
However, as no equivalent proceedings, treaties or recognition conventions exist in EU Member States, with the Brussels Recast Regulation no longer being applicable post-Brexit, sanctioned Schemes would now generally be required to undergo the exequatur procedure in order to be recognised in an EU Member State. In Luxembourg, the exequatur procedure is an ordinary civil proceeding without priority and as such may take significant time to achieve in contested proceedings, leaving an uncertainty in the restructuring transaction (which often proves fatal due to time being of the essence).
On the other hand, English Company Voluntary Arrangements (CVAs) are considered to be insolvency proceedings as they are listed under the European Insolvency Regulation[1]. Thus, prior to Brexit, rulings in relation to CVAs were entitled to automatic recognition in all Member States whereby the European Insolvency Regulation had been fully implemented (subject to that European Member State’s public policy). For example, following the Brexit transposition deadline, a Luxembourgish court would need to apply the exequatur procedure for the recognition of foreign judgements, as Luxembourg has not incorporated the European Insolvency Regulation into national legislation.
English restructuring plans were generally equated to those of Schemes of arrangement for the purpose of recognition (i.e. considered to fall under the scope of the Brussels Recast Regulation). However, following the (albeit controversial) Gategroup case[2], restructuring plans are now widely regarded as falling within the description of insolvency proceedings under the European Insolvency Regulation. Therefore, any restructuring plans launched pre-Brexit would likely be automatically recognisable in all Member States whereby the European Insolvency Regulation had been fully implemented, while restructuring plans launched post-transposition period would follow the exequatur (or equivalent) procedure and not be automatically recognised.
The exequatur (or equivalent) procedure is only applicable if there is no existing convention or treaty between the UK and another Member State whereby automatic recognition exists. Previously, the Lugano Convention on jurisdiction and the recognition and enforcement of judgments in civil and commercial matters was seen as a potential means of obtaining recognition of a Scheme or a restructuring plan in Europe. However, since Brexit (and the UK having failed to accede in its own right, outside of being an EU Member State), the Lugano Convention is no longer applicable to the UK.
The Lugano Convention would have been useful for the purpose of recognition of a Scheme (which is not an insolvency procedure). Some parties saw the potential accession by the UK to the Lugano Convention as a means of ensuring recognition of a restructuring plan, but the decision of the English Courts in the Gategroup matter cast significant doubt in this respect.
While the facts of the Gategroup matter differ from restructuring plans launched post-Brexit, (as the proceedings were initiated on the day of the Brexit transposition deadline), this case provided a detailed analysis of an English restructuring plan, and ultimately ruled that it fell within the bankruptcy proceedings exemption of the Lugano Convention. This had the consequence that the choice of the English Courts as the location for insolvency proceedings to be commenced did not fall within the scope of Lugano, and thus did not qualify for automatic recognition.
The concern with a lack of automatic recognition of these judgements is that while in the majority of Member States, a ruling pursuant to a Scheme, a CVA, or a restructuring plan would likely be recognised under their exequatur (or equivalent) proceedings[3], if a Luxembourg entity is the initiator of a UK Scheme of arrangement or a restructuring plan, for the ruling to be recognised in Luxembourg, they must first have had a COMI shift, or shift of place of central administration to England or other procedural steps. Failing this, in the eyes of the Luxembourg court, the English court ruling on the Scheme, CVA, or restructuring plan does not have jurisdiction to hear a Luxembourgish entity’s pre/post-insolvency proceedings.
The exequatur (or equivalent) procedure is only applicable if there is no existing convention or treaty between the UK and another Member State whereby automatic recognition exists.
Secondly, as Luxembourg has a somewhat outdated idea of creditor cramdown through the concordat preventative de faillite procedure[4], and has not yet implemented any of the measures within the European Insolvency Regulation, there is a certain level of uncertainty as to whether a Luxembourg court would recognise the notion of creditor cramdown in the pre/post-insolvency mechanisms which are employed through Schemes, CVAs or restructuring plans in line with their national public policy. This means that, following lengthy exequatur proceedings, companies run the risk that the Luxembourg court finds that Schemes, CVAs and restructuring plans whereby creditor cramdown are ordered are contrary to public policy, meaning that the recognition order cannot be given.
While certain practitioners argue that by virtue of Luxembourg having failed to implement the Insolvency Regulation by transposition deadline, elements of creditor cramdown ought to be recognisable in a Luxembourg court (if the need for recognition should arise), this cannot be guaranteed leaving an air of uncertainty. While this risk is remote, (a lack of public policy is rarely used as grounds to justify a ruling), it cannot be ignored, as was shown in Ireland in Apperley Investments Limited & Others v Monsoon Accessorize Limited [2020] IEHC 523.
An English Scheme/CVA/restructuring plan is perfectly fine to proceed in the UK without being subsequently recognised in a European Member State, unless the proposed procedure expects to make changes within a European Member State whereby recognition is required. As detailed in the DTEK case[5], an English or Welsh judge sanctioning one of these actions should have confirmation that there is a reasonable likelihood of recognition in the relevant Member States before sanctioning such an action.
Generally, there have been no major developments in the area of insolvency law in Luxembourg since the end of the Brexit transposition period. However, it is important to note that the COVID-19 pandemic was ongoing at the time the transition period finished, and the various stays of payments permitted across various jurisdictions had led to a lower number of insolvency proceedings being initiated within Luxembourg, but we have recently seen some signs that this is changing.
Separately, while the European Insolvency Regulation existed prior to the end of the Brexit transition period, more Member States have implemented national measures to harmonise their approaches with that seen in the UK. However, Luxembourg has not yet done so, nor has it implemented the EU Restructuring Directive. This means that Luxembourg currently does not have the restructuring tools that other EU jurisdictions have implemented (such as, for instance, the French safeguard and the German and Dutch Schemes), and thus complex restructurings are not done in court in Luxembourg but rather settled out of court by security enforcement or by using procedures abroad.
That being said, the so called ‘Luxembourg pre-pack’, which is completed using the very advantageous and robust Luxembourg financial collateral legislation, remains a very common means to implement a cross border debt restructuring. This mechanism entails the enforcement of the top Lux share security and thus transferring ownership of the distressed or restructuring group of companies to the relevant creditor groups. The Luxembourg collateral law remains one of the most, if not the most, creditor-friendly laws in Europe.
Luxembourg currently does not have the restructuring tools that other EU jurisdictions have implemented
The new changes have certainly led to a renewed interest and further requests surrounding where Luxembourg stands on matters such as the implementation of the EU Restructuring Directive or the recognition of Schemes, CVAs or restructuring plans, along with an increased push for clarity in this respect in the Luxembourg market itself. Other than adding more complexity to the structuring around restructuring deals, Luxembourg is still a very popular restructuring jurisdiction because of the number of Luxembourg SPVs that are involved in international financings and the very creditor-friendly financial collateral legislation, which brings the enforcement of Luxembourg share security to one of the most popular ways of taking control of a debtor group in Europe.
It is rather unlikely to substantially change, but depending on how Luxembourg will implement the EU Restructuring Directive, using a Scheme may become easier in the future.
Separately, there is discussion as to whether the UK may attempt to accede to the Lugano Convention. While, as per Gategroup, this would not be of assistance to those seeking to initiate restructuring plans or, separately, CVAs, this could certainly aid companies or groups seeking to initiate Schemes out of the UK while having their COMI/headquarters/place of central administration in an EU Member State, or in one of the other countries which are a party to the Lugano Convention.
We anticipate more complex litigation, in particular if recognition of UK judgments are sought in the insolvency context. Once exequatur procedures are launched concerning post-Brexit UK pre-insolvency and insolvency judgments and the Luxembourg judgments are subsequently rendered, creditors will have more clarity on the likely implications, timing and consequences if enforcement of a UK judgment is needed in Luxembourg.
As relayed above, there are very large discrepancies in terms of the recognition of pre-insolvency proceedings initiated in the UK across Europe and within EU Member States. What makes the difference in complex restructuring cases is not only a dedicated team and international restructuring experience but also being familiar with the UK and US regimes and concepts so the best solutions can be found.
The advice required depends on the type of financing involved, i.e. a bonds transaction (where there is actually another potential grounds for justifying a creditor cramdown – if recognition is actually sought in Luxembourg – through Article 470-13 of Luxembourg Companies law) or a credit financing as briefly demonstrated above, which means that legal counsel with experience is needed in this area. This is even more necessary in Luxembourg; given the lack of clarity surrounding this area of law, this is absolutely essential at present.
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Given that most large-sized multijurisdictional debt restructurings entail many different layers of debt, often both loan and bond debt, it is key to have a multidisciplinary team that is familiar with corporate, lending and bonds aspects as well as with restructuring proceedings, mechanics and tools. For us, one of the main added value to our cross-practice restructuring team is also that many of our people have UK or US legal background or training and are thus familiar with both civil law and common law concepts and legal mindsets. In addition, any complex restructuring requires a team comprising corporate, finance, tax and litigation experts to ensure that all aspects are catered for.
We see more litigious cases now that funds tend to be on the sponsor and lender side. There are also more widespread alternatives where not just the UK or the US is driving the restructuring process but other jurisdictions might be key as well, or a local restructuring process may even be needed to ensure the key assets are secured. We have also noted a US influence on the parties and structures now that, in the last decade, more US funds have invested in Europe and some US firms have beefed up their European (or at least London) presence.
[1] Regulation (EU) 2015/848 of the European Parliament and of the Council of 20 May 2015 on insolvency proceedings (recast), as amended, Annex A.
[2] Re Gategroup Guarantee Limited [2021] EWHC 304 (Ch)
[3] For example, Spain, as per Book II of the CIL and Germany under the German Corporate Stabilisation and Restructuring Act, which was modelled on the English Scheme of arrangement and allows for both horizontal and vertical cramdown of dissenting creditors.
[4] It is also worth noting that this procedure can only be initiated if the place of central administration is in Luxembourg, i.e. no consideration of creditor cramdown of a Luxembourg company’s creditors following a COMI shift.
[5] Re DTEK Energy B.V. & anr [2021] EWHC 1456 (Ch) (convening); [2021] EWHC 1551 (Ch) (sanction).
18-20, rue Edward Steichen, L-2540 Luxembourg
Tel: +352 46 62 30
Fax: +352 46 62 34
Michael Scott, partner, is a member of the dedicated Corporate Restructuring Team in Loyens & Loeff’s Luxembourg office and co-heads the overall Luxembourg Restructuring practice. He focuses on complex cross-border distressed debt restructurings for noteholder groups and multinational companies. He mainly advises US and UK based clients with investments in Luxembourg entities owning target groups in EU jurisdictions.
Anne-Marie Nicolas, partner, heads Loyens & Loeff’s Luxembourg Banking & Finance practice and co-heads its Luxembourg Restructuring practice. Anne-Marie focuses on secured lending, including acquisition finance and real estate as well as distressed financings, security enforcements and debt restructurings.
Véronique Hoffeld, partner, is a member of the Executive Committee of Loyens & Loeff Luxembourg and heads the Litigation & Risk Management Practice Group of its Luxembourg office. She focuses on commercial law, financial litigation and international arbitration. She is also recognised for her contentious insolvency prowess.
Patrick Ferguson, associate, is a member of the Banking and Finance practice group in Loyens & Loeff’s Luxembourg office. Patrick specialises in banking and finance law and acts for private equity firms, financial institutions and investors in various types of cross-border finance transactions, including secured lending, acquisition finance, refinancings and restructuring.
Loyens & Loeff is a leading full-service European law firm with home markets in Luxembourg, Belgium, Switzerland and the Netherlands which specialises in legal and tax matters. From its Benelux and Switzerland offices and in key financial centres around the world, its 1,000 advisers are well-prepared to advise on a broad range of issues including in or out-of-court restructurings, pre-insolvency issues, security enforcements, cross-border insolvencies, corporate governance, financing and rescheduling, distressed acquisitions and sales, distressed debt trading and investments, as well as crisis management and debt restructuring.
We hear from Mactavish CEO Bruce Hepburn as he shares insightful research into the litigation surge, along with his expectations for what it might mean for the future of the sector.
After a period of highly competitive pricing, the UK and global insurance market has seen a drastic reduction in profitability over the past five years, brought on by increasingly adverse market conditions. In a hard market such as this, insurers are facing ‘seller’s regret’ over both the risks they have previously written and the terms or price they wrote them on.
We know insurance prices are rapidly rising, the UK market having seen more than four years of uninterrupted price increases, with companies on average paying premiums that are over double what they were before the onset of the current hard market (and four times more for the most difficult classes of insurance such as professional indemnity, directors’ and officers’ liability and cyber), with widespread reductions in limits and sub-limits, new or broader exclusions and narrower formulations of cover.
Yet while claims account for more than 70% of a typical insurer’s costs, and will always be one of the first places they turn in an attempt to secure profitability, monitoring this change in behaviour from insurers has until now not been so easily proven.
After tracking all disputes in the last decade involving the top 20 insurers in the UK in the High Court, Appeal Court and the Supreme Court, our latest research, the Mactavish Insurance Claim Litigation Index, reveals exactly this: the UK insurance market has become increasingly litigious since the onset of the hard market.
After a period of highly competitive pricing, the UK and global insurance market has seen a drastic reduction in profitability over the past five years.
Research shows that companies are now three times as likely to have to sue their insurers in pursuit of a claim than they were just five years ago. Viewed together through the index, the variety and volume of the disputes lodged provides an extraordinary vantage point into the culture and practice of the UK insurance market. This can help to understand the arguments put forward by insurers in rejection of a claim and offer valuable insights to legal practitioners and businesses on how best to avoid these pitfalls.
In the last decade, the number of cases filed in the courts of England and Wales each year involving the top 20 insurers has doubled. Further, if we isolate only the claims that involve the insurers as defendants (i.e. which deal exclusively with the pursuit by policyholders of unpaid claims), between 2012 and 2016, there was an average of just under such 20 cases filed each year against these firms. Last year the figure was 72, and the year before it was 69 – representing a 280% surge in legal action against the leading insurers.
This is just the tip of the dispute iceberg, as the vast majority of disputed claims get resolved by way of private settlement or in mediation or arbitration, meaning only a fraction go to court. Following any major loss event, policyholders depend on cash flow to manage through the post-event crisis, giving insurers leverage in reducing agreed settlements.
Understanding the driving force behind this rapid increase in disputes necessitates a deeper look at wider trends in the insurance industry. The creation of a tool capable of tracking insurance litigation and claims performance to offer this insight has been long overdue in the UK market.
In order to understand on what specific basis insurers are declining to pay out claims, Mactavish analysed the legal pleadings in 50 of the most recent legal claims. Focusing only on cases where insurers are defendants, we see that the cases centre almost exclusively on the pursuit of unpaid insurance claims by commercial policyholders. The two most common reasons given in defence of their refusal to pay out a claim were that the policyholder lacked coverage for the specific loss event and/or arguments around non-compliance with policy terms.
One of the reasons why these defences are so often relied upon comes down to a widespread issue found in many insurance policies. Too often, we see policy wordings that are not provided until months after placement and are accepted by businesses despite containing issuance errors and drafting ambiguities that are subject to enormous difference in interpretation. In the current hard market, this ambiguity creates a far greater risk of non-compliance or lack of coverage – unbeknownst to the policyholder and not raised by insurers and brokers when policies are sold – which can be relied on by insurers to contest payouts.
Often, the policy is written in a way that only an experienced insurance professional or specialist lawyer can accurately interpret. For instance, when it comes to notifying an insurer of a potential claim, the common time proximity requirement of ‘as soon as practicable’, ‘immediate’ or ‘forthwith’, or the requirements of providing ‘full details’ of circumstances, can mean vastly different things to a business owners and managers. It is only with years of experience in the market that these vague clauses can be decoded into practical, easily understandable terms.
Too often, we see policy wordings that are not provided until months after placement.
Obviously, some insurance claims do reasonably sit in a grey area where liability or quantum are not immediately clear. In these cases it will be necessary to seek out judicial insight. However, disputes currently occur for vastly broader reasons than this, and for businesses navigating this hard market, the priority must be to secure well written insurance policies that minimise room for uncertainty undermining the quality and reliability of your coverage.
The results of the index certainly indicate fantastic opportunities for the legal sector itself, with insurance solicitors and barristers in higher demand that ever before. However, as insurance contracts come under far greater scrutiny in the courts, some authors of those contracts will increasingly find themselves under pressure from employers and clients.
The legal sector may soon find itself in a litigious minefield of its own. In some cases already, the dispute has focused on allegedly defective policy drafting, creating the possibility that some law firms could themselves have some liability for the unpaid claims as this litigation works through the system.
While the opportunities to profit from the increase in legal claims disputes are clear, in this escalating conflict between insurers and policyholders taking place at the same time that risks are evolving rapidly in an environment shaped by multiple political and economic crises, the legal sector will need to tread carefully to avoid being caught in the crossfire.
For insurers, policyholders and the wider economy, the consequences of an increasing number of claims disputes ending up in court are far starker. For many SMEs currently struggling to survive amidst growing economic turmoil, the refusal of insurers to pay claims naturally puts them in a challenging position. Many who find themselves in this situation may already be in a financial crisis due to the loss event that has led to the insurance claim, and therefore far from a position to launch a costly and slow legal action.
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If businesses do not have confidence in the insurance market, the impact on the economy can be significant as companies become less likely to take the risks required to deliver growth, whether that be expansions into new markets or the launching of new products or services. This is why it is so concerning to see the insurance industry damaging its relationship with its customer base and reducing the value of its products just when they are most needed.
A perfect storm of the war in Ukraine, Brexit, global inflation, financial market instability, the impact of sanctions and new classes of risks emerging continue to extend the lifecycle of this hard market – driving premium rates up and coverage and claims payouts down. As a result, it is likely that we will continue to see a high volume of legal action being pursued by policyholders.
The insurance market itself must face up to its wider responsibility and work to meet the needs of its customer base. At a time of widespread economic turpitude, the industry must stand by and support UK businesses by selling clearly drafted products and adjusting them in line with expectations, rather than further threatening their chances of survival.
Bruce Hepburn, CEO
22a St. James’s Square, London, SW1Y 4JH, UK
Tel: +44 02070 467955
E: brucehepburn@mactavishgroup.com
Bruce Hepburn is the founder and CEO of Mactavish, a leading independent outsourced insurance buyer and claims resolution expert in the UK. The firm publishes widely cited research into the commercial and corporate insurance sectors and works with policyholders to deliver improved insurance solutions. Bruce has led Mactavish through every phase of its development over more than two decades of work and is intimately familiar with all aspects of its business.
This month we have the pleasure of hearing from Mark Brealey KC, an expert in the field of competition law who has represented the likes of Pfizer and Ryder in numerous consequential cases. In this exclusive interview, he speaks in depth on his journey into law and offers unique insights on how the field of competition law continues to develop today.
Competition law is fascinating and litigating competition law is more so.
Competition law is never boring. It throws up interesting points of law whilst being grounded in the real world. Businesses adopt restrictive practices on a daily basis. Some are legitimate, some are not. Some are good for the consumer, some are not. The aim of competition law is to identify those which are not.
For example, a non-compete obligation in a vertical agreement may have pro-competitive effects but a non-compete obligation between competitors is likely to be objectionable. It then becomes critical to determine whether the two businesses are actual or potential competitors. Take another example: it is the lifeblood of competition that businesses undercut their competitors to exclude them from the market. Yet if a company is dominant, the same conduct may become objectionable. The definition of the relevant market – how wide or how narrow – becomes a critical factor.
The uncertainty of litigation is then added to the mix. One must try to predict the outcome of competition law disputes, but one can often feel like Pythia at Delphi (and, unfortunately, one can sometimes feel like Cassandra of Troy – to utter true prophecies but never be believed)! The final ingredient is the advocacy, which is obviously about persuasion and how best to put a case. But it involves knowing what to say as well as knowing what not to say!
Competition law is never boring. It throws up interesting points of law whilst being grounded in the real world.
It was a television programme that inspired me to be a barrister. In the 1970s, ITV (Granada) showed a programme called ‘Crown Court’. It ran in the afternoons and each programme comprised three episodes of 25 minutes; the first episode started with the prosecution and the next episode with the defence. The players were actors, but the jury was picked from the public and would deliver their verdict in the last episode. It was compelling stuff. Anyone who has watched it will remember the foreboding introductory music (which as I found out many years later was the Sinfonietta 4th movement by Janacek). It was that programme that got me hooked into the legal system. I always wanted to be a barrister after that.
While at university, I studied European law. This was a move away from a rigid statutory interpretation of an Act of Parliament and away from a deep forensic analysis of a ratio decidendi. It was a game changer to have fundamental principles to consider, such as the principles of equal treatment and effective protection of individual rights.
It was this principle of effective protection that led me to realise that Mr Crehan, a publican, should be entitled to claim damages for loss suffered by being tied to purchasing beer from his brewery landlord. The reaction of the High Court was to bar his claim because he was party to the unlawful tie. But he was signing on the landlord’s standard terms and conditions and was not responsible for the alleged foreclosure of the market. The CJEU ruled that the principle of ex turpi causa should not bar his claim because that would infringe the principle of effective protection (Case C-453/99 Courage v Crehan). This judgment was the catalyst for the wave of private litigation that subsequently followed.
It was a game changer to have fundamental principles to consider, such as the principles of equal treatment and effective protection of individual rights.
I have always practised competition law, but in the early years I was a common law European Union lawyer. EU law spanned nearly every subject, including agriculture, employment, transport, customs and restrictive practices. As lawyers gradually got to grips with EU law, my practice narrowed until it was focused exclusively on competition law. This has remained so because of the introduction of the Competition Act 1998, Brexit, and the grant of greater powers to the CMA.
I have been lucky enough to have appeared in several seminal cases involving competition law.
I have had several trips to the Supreme Court on competition issues. In Sainsbury’s Supermarkets v Visa and Mastercard [2020] UKSC 24 I acted for Sainsbury’s, who successfully argued that the interchange fees payable to the payment card companies restricted competition. The judgment also contained important statements on the pass-on defence (we had successfully argued in the Mastercard trial that there was zero pass-on).
In Deutsche Bahn v Morgan Crucible [2014] UKSC 24, which concerned the graphite cartel, we successfully argued that the claim for damages was time-barred. Similarly, in BCL Old v BASF [2012] UKSC 45, which concerned the vitamins cartel, we successfully argued that the claim for damages be dismissed. In CMA v Flynn Pharma [2022] UKSC 14 we successfully argued that the CMA should be liable to adverse costs orders (the CMA had argued that, as a public authority, it was effectively exempt).
I am also privileged to have appeared in several Court of Appeal cases involving important points of competition law. For example, recently in CMA v Pfizer [2020] I acted for Pfizer in its appeal against the CMA’s decision that the price of a drug was unfair. We successfully argued that the CMA had not applied the correct test for an excessively abusive price. The CMA had wrongly focused on a cost-plus model and had had insufficient regard to the prices of comparator products. The judgment contains important statements of principle concerning the CJEU’s judgment in United Brands and what considerations are relevant in determining an excessive price.
In AB Volvo v Ryder Ltd [2020] EWCA Civ 1475 I acted for Ryder, which was suing various truck manufacturers for loss suffered because of the trucks cartel. The manufacturers had admitted their liability as a part of the EU leniency and settlement programme. We successfully argued that the defendants should be bound by the findings of fact admitted as part of these programmes. It would be an abuse of process to re-litigate such findings in the domestic courts.
As lawyers gradually got to grips with EU law, my practice narrowed until it was focused exclusively on competition law.
The bread and butter, though, are the trials. There is much litigation concerning competition law, whether it be an appeal against a decision adopted by the CMA or a claim between two private parties. This year I have had a three-week and a five-week trial. Both amounted to complex pieces of litigation involving significant disclosure, witness evidence and expert evidence adduced by both sides.
These trials do have extra dimensions. If the hearing is an appeal against an infringement decision it has the added dimension of being quasi-criminal because of the substantial penalties that are involved. That involves a greater duty to ensure a fair hearing than normally associated with civil litigation. If the hearing is a private dispute involving a claim for damages, we must understand complex regression models to determine the extent of any overcharge and pass-on.
Forensic accounting evidence will often be adduced to determine any loss of profit caused by any pass-on (volume effects) and, lastly, the amount of any compound interest which, given the secretive nature and duration of cartels, can often double the size of the main claim. All of this is on top of the esoteric points of competition law that gave rise to the dispute in the first place.
One of my recent highlights was appearing in the Supreme Court of the incredibly friendly Island of Mauritius. I was given special dispensation to appear on behalf of Emtel, one of the mobile phone operators in Mauritius, who was suing the fixed line operator, Mauritius Telecom, for attempting to remove it from the market in favour of its own mobile phone operator, Cellplus (Case 2017 SCJ 294 Emtel v Cellplus). The case is now before the Privy Council.
Competition law has been litigated in the UK now for some time. However, the last few years have seen some fundamental changes in the way it is litigated.
First, Brexit has made competition law more UK-centric. I appeared regularly before the Courts in Luxembourg, and although I have rights of audience as a member of the Irish bar (having taken the bar exams because of Brexit), there is no doubt that Brexit has changed the way competition law is litigated. There are no references from the UK to the CJEU anymore. The CMA now adopts the infringement decision, whereas before Brexit the EU Commission may have taken the lead.
Competition law has been litigated in the UK now for some time. However, the last few years have seen some fundamental changes in the way it is litigated.
Second, the last few years have witnessed a significant increase in class actions (including opt-in but particularly opt-out). The Supreme Court’s judgment in Merricks lowered the threshold for bringing such collective actions. The CAT now has several collective actions in the pipeline against big tech companies, transport operators and payment card schemes. These will all come to trial in the next few years and may represent a sea change in the way that private litigation is perceived as enforcing competition law.
Third, because of the judgments in the Interchange fee litigation, most private claims for damages commenced in the High Court are now transferred to the CAT. Although the High Court retains jurisdiction where the competition law claim is mixed with a non-competition claim (e.g. contractual or a fraud claim), the CAT has effectively become the default forum for determining private law competition law disputes. The CAT is now the specialist forum for hearing all disputes involving competition law: the CAT determines private law claims in addition to exercising its statutory supervisory powers over the CMA.
None of these changes present a problem. In this country we have an amazing system set up to determine anti-competitive practices: a robust and specialist competition authority headed up by and advised by some of the best competition lawyers and economists (the CMA), and a tribunal comprised of specialist competition law judges and leading economists (the CAT). We also have a Court of Appeal and a Supreme Court that comprises judges who were, when at the bar, specialist practitioners of competition law. In short, we have competition law expertise throughout the judicial system.
The diary for 2023-2024 looks busy! The trucks cartel litigation starts in March 2023. I have trials involving pharmaceutical drugs (abusive pricing and a pay for delay). I am acting for Epic in the forthcoming trial involving Google which concerns the removal of the Fortnite game from the Android phone, and which in turn concerns the restrictions on operating competing app stores and in-app payment solutions. The banking libor litigation continues.
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In addition, I need to start writing the third edition of the book ‘Competition litigation: UK Practice and Procedure’. This is a cradle-to-grave account of litigating competition law: how to bring a claim, the correct forum, disclosure, summary judgment, remedies, the hearing, costs, appeals etc. Keeping the book up to date is like ‘painting the Forth Bridge’ – an interminable task. But that is what makes it all so interesting!
Mark Brealey KC
1 & 2 Raymond Buildings, Gray’s Inn, London WC1R 5NR, UK
Tel: +44 02074 057211
Fax: +44 02074 052084
Mark Brealey is a barrister and a specialist litigator in all aspects of competition law. He regularly appears before the Competition Appeal Tribunal on behalf of companies appealing CMA decisions and has argued points of importance before the Supreme Court and Court of Justice of the European Communities many times. He is also the editor of ‘Competition litigation: UK Practice and Procedure’ and was recognised as The Times Lawyer of the Week beginning 25 June 2020.
Monckton Chambers is a leading set of barristers’ chambers with expertise across a broad swathe of civil and commercial law, with particular focuses on EU, competition, commercial litigation and arbitration, VAT and public and administrative law. Being one of the first chambers to move to Gray’s Inn in 1964, Monckton Chambers has a storied history of acting for large corporates, SMEs and private individuals throughout the private sector.
Between the United Kingdom’s formal withdrawal from the European Union on 31 January 2020 and the end of the Brexit ‘transition period’ on 31 December 2020, the UK government created a category of domestic legislation consisting of EU statutes that had been kept, unchanged, as part of UK law, as well as other laws that were influenced by or derived from them. These retained EU laws (REUL) covered employment law, environmental regulation, data protection, IP law and other areas.
The UK government published the Retained EU Law (Revocation and Reform) Bill on 22 September 2022. If enacted, REUL will lose the special status it currently enjoys and eventually become subject to revocation. Depending on the actions the government chooses to prioritise prior to this, the knock-on effects could be extensive. But how, and what would be affected?
The intention of the Bill, per the cabinet’s statements, is to “ensure that only regulation that is fit for purpose and suited for the UK will remain on the statute book”. As such, all REUL will be revoked on 31 December 2023, or at a later date prior to 23 June 2026 if a consensus to delay is reached. Members of Parliament will need to take positive action in order to determine which elements of these statues will be codified into UK law while the remainder are ‘sunset’.
The Bill will also do away with all status protections associated with REUL, granting ministers the power to reverse the order of supremacy in law and securing domestic law as “the highest form of law on the UK statute book”. Further to this, the Bill seeks to guarantee courts greater discretion in departing from REUL case law and to recategorise all preserved REUL as ‘assimilated law’. However, rights contained in primary legislation (that is, laws passed as an Act of Parliament), such as the Equality Act, should be exempt from these effects.
Over 2,400 pieces of REUL are currently in force in UK law. Since its announcement of the Bill, the government has made few statements to indicate which parts of this body it intends to drop or keep should it be passed. In effect, all areas of secondary UK legislation that are defined in whole or in part by EU law are assumed to be ‘at risk’.
One of the most profoundly implicated areas is employment law. REUL laws are integral in preserving, among other rights, such as:
Also at risk are the EU-derived collective consultation requirements laid out in section 188 of the Trade Union and Labour Relations (Consolidation) Act 1992, a stipulation that trade unions are likely to fight to preserve if no move is made to preserve it spontaneously.
Additional targets include crucial environmental and rural affairs legislation, which had largely been devolved to national governments. Around 570 laws relating to habitat protection, water quality and sewage pollution could, if removed, result in a number of the country’s specially protected sites become open to development, as wildlife organisations have noted.
In effect, all areas of secondary UK legislation that are defined in whole or in part by EU law are assumed to be ‘at risk’.
Food standards, such as the required use of decontaminants on meat products and chlorine washes on chicken, also hang in the balance. Beyond the health implications of having such rules revoked, there would also be implications for exports into European markets still operating according to EU laws.
Reactions to the Bill among the legal sector have trended towards the negative. Richard Arthur, Head of Trade Union Law at Thompsons Solicitors, led the way by branding it “the biggest, and most catastrophic, demolition of workplace rights in generations”, and Scottish ministers issued an open letter to the UK government asking that the new law and its apparent abrogation of devolved powers be reconsidered.
Some analysts have expressed surprise over the Bill’s apparent transfer of legislative powers relating to retained EU law to the executive branch, and away from Parliament. As ministers will be empowered to make changes to REUL via statutory instrument (SI), which receive limited scrutiny from Parliament, such changes are unlikely to garner due challenge from MPs (only 17 SIs have been voted down in the House of Commons in the past 65 years, and none since 1979).
The possibility of certain employment-related pieces of REUL being sunset also raises issues of legality. Under the Trade and Cooperation Agreement signed by the UK and EU, both parties agreed to not to weaken their labour standards – including all fundamental workplace rights, health and safety standards, employment standards and working condition standards – below the levels that were in place in 2018. This would be contravened if any REUL measure protecting such rights were sunset without a replacement of at least equal strength and specificity.
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With 2,400 REUL measures at play, there are altogether too many possible futures for this Bill to give concrete advice on how businesses ought to prepare for its effects. Either unprecedented deregulation or a return to ‘business as usual’ are both believable scenarios.
The Bill has also arrived against a backdrop of strife within the UK. September also saw the death of Queen Elizabeth II, the confirmation of Liz Truss as Prime Minister and the announcement of a ‘mini-budget’ that has prompted a dive in the value of the pound, exacerbating an already severe cost of living crisis.
With such uncertainties already looming, it is likely that the need to remain aware of shifts in employment law will prove to be an additional burden on employers – and when taken together with the government’s continued grappling with the Northern Ireland Protocol, it seems certain that investors will reconsider new commitments in the UK until some of these questions are soundly answered.
Lawyer Monthly will continue to monitor the Bill’s progress through Parliament, as well as the waves it will leave throughout the legal sphere.
Business immigration lawyer Alex Christen of Capital Law examines the new immigration system in this article, weighing its observed benefits with the areas that still require development.
Prompted by Brexit, a new points-based immigration system was introduced in the UK in December 2020. The aim was to simplify UK inbound immigration and allow a wider group of skilled workers to come to the UK for work – opening the country up to the ‘brightest and best’ of overseas workers, particularly those working in STEM or tech roles. The new system applies now to all non-UK nationals who want to work in the UK, including EU nationals (except Irish nationals, who have retained their right to work in the UK without restriction under pre-existing laws).
Under the new system, and to secure a skilled worker visa, applicants need to score 70 points. Points are totalled based on the job offer received and speaking English, as well as depending on skill level and salary requirements. Points are awarded to said categories but can be traded to offset the total amount.
A points-based approach existed under the old system, introduced in 2008 for non-EEA national work and study visas. But as this research briefing from the UK Parliament explains, “visa eligibility was determined by satisfying a set of mandatory criteria, to which a fixed number of symbolic points are attached. This has arguably resulted in a system which is points-based in name only.”
In comparison, one of the key features of the new system is the ability to trade points. For example, if the salary for the role is not high enough to meet the standard minimum salary threshold (and accordingly the applicant does not get enough points for salary), the applicant can trade points elsewhere, for example by having a PhD in a STEM subject that is relevant to the role.
Points are totalled based on the job offer received and speaking English, as well as depending on skill level and salary requirements.
As such, the new system makes it easier for employers to sponsor people from outside the UK. It is a relatively conventional employer-led system, requiring the points-tested route where the applicant must have a job offer and must do the specific job for which they are sponsored. Gone are the time-consuming (and often artificial) requirements to advertise the vacancy in the UK before it could be offered to a sponsored employee on the previous immigration system.
Similarly, the skill and salary levels have also been lowered across many of the routes. For example, under the Skilled Worker route, the minimum skill level required for sponsorship reduced from degree to A-level or equivalent and the standard minimum salary level was reduced by around £5,000 (subject to the going rates for that role).
The UK has also updated its list of roles that are understaffed in the country. If a role appears on this list, such as web designers, scientists, engineers or veterinarians (to name a few), it is because labour is in short supply in the UK and accordingly, the visa eligibility requirements are relaxed slightly to allow a wider pool of overseas workers to fill the vacancies. This list is reviewed regularly but changes are seldom made.
In February this year, however, the list was updated to include roles in the care sector – allowing more people to qualify for the new Health and Care Worker visa as well as the Skilled Worker visa route. This was triggered by a shortage of care workers in the UK, which undoubtedly resulted from the loss of free movement of people following Brexit and the fallout from the pandemic.
Gone are the time-consuming (and often artificial) requirements to advertise the vacancy in the UK before it could be offered to a sponsored employee on the previous immigration system.
The new system has also been reactive to UK labour markets in other ways. October last year saw the introduction of temporary visas for specific categories of work that are also in short supply in the UK, including visas for HGV drivers, poultry workers and butchers. However, take-up of those visas was incredibly low, possibly because they only offered short-term work solutions in the UK.
More substantial visa routes have also been introduced in 2022 under the new system, including a range of global mobility visas in March and a route for high potential individuals in May. Most recently, in August, a route was introduced specifically for those looking to work in scale up companies.
What is clear is that a lot has gone on in the last 18 months and it remains to be seen what changes will be made in the coming years, given the government’s plans to further digitise its immigration system. But so far, has the new immigration system delivered what it promised: a system that allows the ‘brightest and best’ to enhance the UK economy and job market?
While the system has made immigration easier in some respects, in other respects many of the old issues remain. For most work visa routes, the individual wanting to work in the UK must have a sponsor. This is usually the business that will employ them. For the employer, this means there is still a requirement to apply for and maintain a sponsor licence, which is no small feat. The application process is still fairly cumbersome and expensive, making it hard for smaller businesses to afford to become a sponsor in the first place. The ongoing compliance duties are tricky for businesses to understand, and obligations are often missed, which can lead to a sponsor losing its licence and consequently its ability to employ non-UK nationals.
Also to be considered are the timescales for applying for a licence or making changes to an existing one. Home Office resources are stretched, and licence applications are taking eight weeks plus additional time to process (with changes to licences taking up to 18 weeks). The Home Office is trying to resolve these issues, for example by opening up more priority licence application slots on a daily basis and by taking a more lenient approach to sponsors who voluntarily report licence breaches.
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Many of the new routes, particularly the global mobility routes (most of which are revamped old routes), still have onerous eligibility requirements. For example, anyone wanting to come to the UK under the Service Supplier route must show that their work falls under a relevant international trade agreement, in some cases have degree level or equivalent qualifications and up to six years on the job experience, and be fortunate enough to have a UK sponsor. Such onerous conditions mean that this route is rarely used. For whatever reason, the UK has chosen not to hop on board the remote working visa trend that many other countries have introduced, calling into question whether there can truly be a globally mobile visa route into the UK.
The ambit of other routes is often misunderstood, and it remains to be seen how the new Scale Up route will fare, with applicants only having to work for their sponsor for six months before being free to explore UK vacancies elsewhere for the remainder of their visa.
Similarly, the general overviews on gov.uk for each immigration route can be too simplistic, often missing out key pieces of information on the eligibility requirements for each visa route. The more detailed guidance notes for sponsors and applicants are extensive, but they too can be confusing and tricky to navigate.
My best piece of advice to businesses here is to not be discouraged, and to seek legal advice to make sure they stay on the right side of immigration law. A good place to start is conducting an audit of your documents and HR systems to make sure you are compliant with your reporting obligations to the Home Office; are carrying appropriate right to work checks; and sponsoring suitable roles. There are serious financial penalties for businesses who do not follow the immigration rules, which should not be underestimated.
Alex Christen, Senior Associate
Capital Building, Tyndall Street, Cardiff CF10 4AZ
Tel: +44 02920 474423
E: a.christen@capitallaw.co.uk
Alex Christen is a senior associate in Capital Law’s employment and immigration team. With over six years’ experience in providing businesses and individuals with immigration advice and praise from The Legal 500 for her professional approach, she supports clients across a range of industries on all manner of employment law.
Capital Law is a full-service commercial law firm, with offices in Cardiff, London, and Paris. Its clients include businesses of all sizes, from start-ups to large corporates. It also works with a growing number of not-for-profit organisations in education and social housing, as well as with regulators and governmental bodies. As a member of several international legal networks, its lawyers often advise overseas clients and general counsel in global companies.
Chartered Trade Mark Attorney Beverley Robinson sheds some light on the effects of the health crisis on trade mark law and IP more broadly, as well as the other trends currently shaping the careers of trade mark attorneys.
How we interact with colleagues and clients has changed significantly, moving from a more formal meeting setting to one that is more relaxed. Whilst the benefits of face-to-face meetings can never truly be replicated with virtual meetings, the convenience of video makes it easier to keep in touch regularly with clients.
We also now work in a more agile way that includes both home working and office working, which can allow for greater flexibility and increased productivity.
As a result of the pandemic, businesses have had to adapt and diversify. This naturally has led to a wave of new innovations requiring IP protection.
In particular, a significant increase in eCommerce has driven innovation in online marketplaces and social media platforms but has also given rise to a significant increase in counterfeit goods. This has resulted in an increased need for online protection of rights and enforcement strategies.
Our role involves an international element as managing our clients’ global portfolios requires us to work with a large network of trusted overseas associates. Building and maintaining these relationships during the pandemic was more challenging due to travel restrictions, and communication channels had to be kept open. In-person conferences and events, where we can reconnect with our contacts and foster new relationships, are now more important than ever.
Traditionally, the teaching of trainees and junior members of the profession took place in an office environment, where conversations could be had easily, colleagues could be observed and learning could be done by osmosis. During the pandemic, this was not possible, and we had to adapt to new ways of teaching to ensure junior attorneys continued to learn and gain practical experience.
How we interact with colleagues and clients has changed significantly, moving from a more formal meeting setting to one that is more relaxed.
Qualifying courses for trade mark attorneys moved online during the pandemic, but these have now reverted back to traditional class-based learning in recognition of the benefits of face-to-face tuition. In-person learning also facilitates meeting and building relationships with students’ industry peers.
Across virtually all industries and businesses, sustainability is a key factor influencing the purchasing decisions of increasingly more consumers. Businesses are trying to reduce the negative impact they have on the environment or society, even if this requires significant investment.
Building a brand that incorporates sustainability is vital. However, creating and maintaining an environmentally conscious brand image requires significant resources, and businesses are faced with the challenge of delivering the right message whilst complying with increasing regulation. Part of our role is to work with brand owners to get the messaging right, and to ensure that their investment and efforts to increase sustainability are captured and protected in their IP.
Brexit continues to impact our profession as we navigate new procedures and begin to better understand Brexit’s impact and practicalities on EU trade mark rights. Before Brexit, UK and EU trade mark law was harmonised, meaning it was possible to file a single trade mark application covering the whole of the EU, including the UK. Consequently, Brexit caused a lot of uncertainty for trade mark owners and their attorneys, and we are now ensuring that the necessary steps and strategic decisions have been taken to protect our clients’ IP.
As trade mark attorneys, we are fortunate enough to work in a fast-paced and dynamic environment which offers plenty of learning opportunities. When these opportunities arise, putting yourself forward to be involved with projects or meetings – even just to observe – can be invaluable. In my experience, working with as many people as possible broadens knowledge and experience as everyone works in different ways and has different strengths and skillsets.
As well as learning and understanding the law, take the time to learn about, and really understand, a client’s business, including its customers, structure, goals and ambitions. This will ensure your advice is more valuable and commercially focused advice and will help to build strong client relationships.
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Take advantage of industry associations and events, which provide the opportunity to meet professionals in the industry, and to learn and share legal knowledge and experience. This can also help raise your profile within the IP community.
Beverley Robinson, Senior Associate
1 East Parade, Leeds, LS1 2AD, United Kingdom
Tel: +44 01132 465353
E: Beverley.Robinson@appleyardlees.com
Beverley Robinson is a Chartered Trade Mark Attorney and senior associate at intellectual property law firm Appleyard Lees IP LLP. She is experienced in contentious and non-contentious trade mark, design and copyright matters and acts for a broad range of clients across a variety of industries, including technology, retail, fashion and beauty. Beverley’s practice includes filing, prosecution, disputes and enforcement of IP rights. Beverley is a member of the Chartered Institute of Trade Mark Attorneys and the ECTA law committee.
Appleyard Lees is a leading intellectual property law firm with over 60 patent and trademark attorneys and litigators. The team brings broad sector and industry knowledge and offers a full spectrum of IP services, including initial strategy and scoping, prosecution, and post-grant support, should disputes or other issues arise. Working with some of the world’s most exciting innovators, largest companies and household names, the firm supports a broad range of IP owners and creators, including in-house teams, R&D specialists, owner-managers, and branding professionals.
