Understand Your Rights. Solve Your Legal Problems
The Government has said that leaving the European Union will “bring about an end to the direct jurisdiction of the Court of Justice of the European Union.” The House of Lords EU Justice Sub-Committee recently launched a new inquiry on this issue and the question of enforcement and dispute resolution post-Brexit.
Following a session with four senior retired judges on 21st November, the Committee is now issuing a formal call for evidence. Issues under consideration include:
Chairman of the Committee Baroness Kennedy of The Shaws said: “The evidence that we received from four of the UK’s most senior former judges highlighted the dangers of legal uncertainty post Brexit.
“It was apparent that the judges had significant concerns about the operation of ‘retained EU law’ in the UK under Clause 6 of the European Union (Withdrawal) Bill. The former Lord Chief Justice, Lord Thomas of Cwmgiedd, warned that there could be a ‘very real problem for future judicial independence and the rule of law if this is not clarified.’ In addition to concerns about the wide discretion that might be given to the judiciary to take what might be seen as ‘political’ decisions, it is also far from clear that the provisions relating to the interpretation of retained EU law under Clause 6 of the Bill allow for a smooth transition. The Bill was clearly not drafted with a transitional period in mind. It would preclude references to the Court of Justice of the European Union, and not require UK domestic courts to take account of post-Brexit EU law, despite the fact that the UK may continue to be effectively bound by EU law during the transitional period.
“Going forward, the Government will have to ensure that it can agree a clear, certain and robust enforcement mechanism to ensure that any rights and obligations under the Withdrawal Agreement (and subsequent partnership arrangements with the EU) can be upheld in the event of a dispute. The Committee is seeking expert evidence on the most appropriate way of ensuring that dispute resolution procedures post-Brexit can be dealt with efficiently and effectively.”
The Committee asks for written submissions to be received by Friday 19th January.
(Source: House of Lords)
Bar leaders recently published a paper tackling issues raised both by the Irish border question and the vision for ‘frictionless’ trade set out by the Prime Minister earlier this year.
Brexit Paper no. 25 looks at the legal and historic links between the EU, the internal market and customs union, and how the UK could negotiate a reduced role for the ECJ as well as tighter controls on EU worker migration while protecting key economic interests.
Chair of the Brexit Working Group, Hugh Mercer QC said: “By building on the legal framework covering the UK’s existing opt-outs, the Government could solve some of the most difficult issues in the current talks while keeping the power to negotiate bi-lateral deals on agriculture, fisheries, competition, trade and environment, which would end the ECJ’s jurisdiction in those areas.”
According to the report’s authors, the ECJ would no longer have jurisdiction to interpret rights derived from EU citizenship in the UK and a deal could be struck to confirm UK sovereignty over internal market and customs union matters and to define clearly the status of ECJ rulings in those areas.
Hugh Mercer QC said: “Opting into the internal market and customs union could be negotiated along-side a complete opt-out from the political elements of the EU and an overhaul of the scope and role of the ECJ so far as the UK is concerned. The status of its rulings and its jurisdiction would be significantly reduced and much more clearly defined to ensure the sovereignty of the UK Parliament.”
The paper explains that a worker registration scheme could be used as part of a managed approach to migration, giving the Government access to data on the parts of the economy that draw in EU workers. Ministers would set the criteria to refuse admission or deport those who are not in employment, and Parliament would set the terms on which EU citizens access social security and pass employment laws to support British workers.
Chair of the Bar, Andrew Langdon QC said: “The UK is at a crucial stage in the negotiations and the legal consequences of all the options available must be carefully considered. This analysis sign-posts some of the legal avenues that could help Government to manage the competing demands and priorities inherent in the negotiations.”
One of the Bar Council’s Third Edition Brexit Papers, published earlier this year, looked at the legal consequences of leaving the European Union without first agreeing a trade deal and the implications of relying on international trade under terms set by the WTO.
‘Brexit Paper 25: The relationship between the single market, the customs union and the European Union’ is available here.
(Source: The Bar Council)
Though variant figures have emerged, the bill the UK will have to pay out to exit the EU amounts to a significant amount of the nation’s GDP. The latest figure is reported to be £39 billion. Amelia Bishop, of Amelia Bishop Consulting, believes this sum of cash could and should be spent on far more important economic priorities.
Paying the EU £39bn is a lot of money that could be better used elsewhere, whilst considering where else could benefit massively it occurred to me that there are so many areas of our lives that could be improved with a financial boost and narrowing it down hasn’t been an easy task.
Prioritising such a list also has its challenges, as so many needy areas see themselves as a priority when asked, and they are often well justified.
Whilst the beneficiaries of my assignment of £39 billion are all in somewhat equal need they are prioritised partly by need and partly by urgency.
1. The NHS £20bn
The government’s pledge of an additional £8bn in May 17 was claimed by experts to result in a £12bn deficit in the same period due to NHS spend increasing by 1.2% per annum. An additional £6.3bn pledged by the government during this parliament in the recent autumn budget would not bridge the deficit gap therefore I would assign the NHS and additional £12.5bn to totally remove the deficit and provide the NHS with an additional £6.8bn cashflow to spend on additional staff and efficiency improvements.
In recent months a number of safe centres have been earmarked for closure in part being due to insufficient expansion room and the cost of building new centres being too high. An additional £6.5bn will provide cashflow to enable the building of new mental health centres, this additional funding combined with the sale of existing mental health centres for development land would provide funding to assist with the provision of much needed additional bed space in newly developed mental health centres.
We are currently in times of high employment with many employers struggling to fill vacancies and seeing increased competition in retaining their existing staff. Providing support and workplace training for disabled people will provide an additional pool of resource for employers and give many disabled people additional skills and self-esteem to gain opportunities of work.
2. Charities £2bn – End of life care, saving and improving lives specifically
The new GDPR legislation is putting increased pressure on the limited resource that charities have to become compliant by May 2018. Money is also being diverted for GDPR readiness taking it away from the cause that these charities fundraise for, an additional £1bn fund will assist these charities in continuing to support their causes.
With all times of uncertainty, donations are sacrificed for essentials, charities always struggle to provide the necessary support for their cause, an additional £1bn fund will help to cover the shortfall in donations.
3. Brexit - SME readiness funding £8bn
There are many risks and wholesale changes coming with our leaving the EU and the cost for business is sizeable depending on the size of the business, SME’s will struggle to fund the changes and contingency planning their business needs therefore a funding pot of £5bn should be provided to support this activity.
Brexit will create many opportunities across all industry sectors for entrepreneurs. Exploring opportunities takes time and money, therefore funding of exploring and seizing opportunities will help to remove financial hurdles for entrepreneurs who in the longer term will benefit the UK’s economy and raise the UK’s profile for innovation.
4. People in Poverty £5bn – Bringing people and families out of poverty
With so many people and families falling into the poverty bracket funding should be provided to help with childcare and training to help people out of poverty and into work. This will also help with making additional people available to assist with filling the vacancies that have been created by the fall in available workers.
5. Social Housing £4bn – Building more affordable homes
The government committed £1bn to the creation of affordable homes in the recent autumn budget. With house prices so high across the country many young people stand no chance of buying their own home, therefore I would invest another £4bn to boost the amount of affordable homes, creating many jobs in the process.
The House of Lords EU Committee has today published its report Brexit: deal or no deal, outlining the potential impact of the UK leaving the EU without a deal, and examining the feasibility of a transition period immediately post-Brexit.
The Committee describes the Government’s assertion that ‘no deal is better than a bad deal’ as ‘not helpful’, and says it is ‘difficult, if not impossible, to envisage a worse outcome for the UK’. The report makes clear that ‘no deal’ would not only be economically damaging, but would bring an abrupt end to cooperation between the UK and EU on issues such as counter terrorism, police and security and nuclear safeguards. It would also necessitate the imposition of controls at the Irish land border.
The Committee identifies shortage of time, the ‘ticking clock’ of the Article 50 deadline, as the greatest risk factor that could lead to a ‘no deal’ outcome. The Committee agrees with the Government that concluding all aspects of the negotiations before March 2019 would be the best outcome, but notes that the overwhelming weight of evidence suggests that this will be impossible. The Committee concludes that enshrining the Article 50 deadline of 29 March 2019 in domestic law would ‘not be in the national interest’.
The Committee also questions the feasibility of a ‘bare bones’ deal, as described by the Secretary of State for Exiting the EU, in the event that a full agreement is not achieved, and agrees with the Confederation of British Industry that it would in any case be a ‘very bad deal’.
The Committee questions whether a legally binding transition deal can be reached in time to prevent damage to the UK economy. The Committee suggests that negotiations could last several years, and that a ‘standstill’ transition period may therefore be needed to buy time for negotiations to continue beyond March 2019.
The Committee notes that the only secure legal basis for transition may be to use one of the two options available under Article 50, either to extend UK membership of the EU for a time limited period, or to set a date later than March 2019 for withdrawal to take effect, and calls on the Government to review these options.
Commenting on the report, Lord Jay of Ewelme, acting Chairman of the House of Lords EU Committee, said: “The overwhelming weight of evidence suggests that ‘no deal’ would be the worst possible outcome for the UK, in terms of the economy, security, the environment and citizens’ rights.
“The biggest risk factor that might lead to a no deal outcome is time – the clock is ticking. While we support David Davis’ ambition to secure a comprehensive agreement by 29 March 2019, almost nobody outside the Government thinks this will be possible. The negotiations may need to continue beyond that point, and enshrining the deadline in domestic law would not be in the national interest.
“Both sides agree that we will need a transition period, to give confidence to businesses and potentially to buy time to complete the negotiations. But the Government hasn’t yet explained how transition will work, or what its basis will be in EU law. The evidence is clear that in legal terms the most secure way to buy time is to use one of the options that exist within Article 50 for a time-limited extension of the UK’s EU membership.
“We will live with the consequences of Brexit for decades to come, so we need to get it right. If buying a bit more time means that we get a better outcome, which benefits businesses and citizens on both sides, a short extension of EU membership may be a price worth paying. This is not about unpicking Brexit, but about delivering the best Brexit possible.”
(Source: The House of Lords)
In what way does Turkey’s growing economy and geographical position advantageous for its commercial growth?
Turkey’s geographical position provides many advantages as it is almost literally on the centre of the world, positioned as a bridge between Europe and Asia, right on the historical trade routes. This position would enable any producer with the ability to easily distribute its products anywhere in the world. Therefore, against all negative economic developments in the recent years, I do believe Turkey will attract more foreign investors in the upcoming years, shaking off the slowdown in its economic growth, as it will be always an advantageous hub for investors, thanks to its geographical position.
In addition, Turkey’s growing economy naturally encourages foreign investors. In this respect, the state grants provided to the new and growing businesses are worth mentioning as well as the incentive systems for foreign investors which provides important advantages such as exemption from certain taxes or land allocation opportunities.
US-Turkish trade peaked at nearly $20 billion in 2011, but has decreased in recent years, falling to $17.3 billion in 2016; how has this been reflected with what you have seen in terms of M&A activity in Turkey?
It is obvious that recent political and diplomatic tensions do not help in enhancing the commercial relationship between US and Turkey. However, 2016 was a challenging year for most countries throughout the world. Both Brexit and US presidential elections affected the world economy, raising concerns. Along with the political and economic risks and uncertainty in the Middle East, Turkish M&A market has naturally affected negatively.
According to the reports, the volume of M&A transactions, including foreign investors, dropped by 67% in 2016, making it the lowest year after 2009 financial crisis. Moreover, the number of M&A deals between Turkish and North American companies, declined to 17 in 2016, dropping from 28 in 2015.
Moreover, how are you hoping this will change in the upcoming year?
Even though the negativity of recent conjuncture cannot be denied, the Turkish Government aims to provide effective solutions and precautions to remedy the risks for the investors and boost the developing Turkish economy. In addition, as Turkey has a young and dynamic workforce, and is rich with resources under and above ground, it has a lot to provide for investors. Thus, I see the rise in investment and economy is inevitable in the near future.
With regards to M&A activity, some markets were eye-catching in 2016, such as information and mobile services, energy and finance. Thus, it would be rational to expect that there will be significant transactions in those sectors in the upcoming years.
Moreover, Turkey’s positive approach to privatisation and extensive privatisation portfolio also provides important investment opportunities in businesses such as hydroelectric plants, mining and energy businesses. Therefore, privatisation will continue to have an in important place in the upcoming years as well.
Are there any regulations to which you deem as outdated in Turkey, which upon amendments, may help progress economic growth throughout the country?
The most relevant general regulations (Turkish Commercial Code, Code of Obligations, and Code of Civil Procedure) with regards to commerce and commercial litigation are amended in 2011. Therefore, main regulations related to commerce are considerably current. However, the lengthy trials are one of the biggest issues we face in commercial litigation. As I believe that a trusted, effective, and fast legal system will inevitably benefit economic growth, an extensive reform to improve the litigation system and decrease the workload of the courts is necessary.
You are currently working towards your PhD in Private Law – how are you hoping this research will set you out from the rest in legal practice?
As a legal practitioner, I do find continuing higher education following the law school significantly important and beneficial. Besides gaining a deeper knowledge and understanding of law, higher education provides you with abilities to analyse the legal matters you face from different and deeper perspectives. This, I believe, furnishes a lawyer with the ability to develop unprecedented and creative legal solutions, or arguments which are essential in resolving complex legal matters. Through this, a lawyer also undertakes a mission of creating law in addition to enforcing the law.
Moreover, the synthesis of theoretical information with our experience in practice provides excellent results, enabling us to analyse the possible outcomes of a dispute or transaction much more clearly. In return, with such ability, we take pride in being able to protect the rights of our clients much more effectively and gain the best possible results for our clients in dispute resolution.
Göktuğ Can Burul, LL.M, Esq.
BKA Attorneys at Law
Address: Nish Istanbul Residence B Blok K: 5 D: 58 Bahcelievler Istanbul
Office Phone: +90 212 806 43 69
Mobile: +90 533 717 20 61
E-mail: goktugburul@bka-law.com
Web-Site: www.bka-law.com
Goktug Can Burul is one of the founding partners of BKA Attorneys at Law. He holds two LL.M. degrees in International Trade and Economy Law, one of which is from Georgetown University Law Center. He is admitted to New York State Bar along with Istanbul Bar. His practice mainly focuses on commercial and real estate law and he has an extensive experience in complex litigation matters. Goktug has been involved and represented his clients in various projects in different sectors from construction to agriculture. He also represented Istanbul Bar in 2016 in Contracts Negotiation Competition held by European Bars Federation where he was ranked in top three among ten teams.
BKA Attorneys at Law, is a boutique law firm located in Istanbul, Turkey and provides extensive and exceptional legal services in various areas of law including commercial, real estate, customs, labour law, mining, and energy. The firm’s clientele includes leading Turkish and international corporations. In our work, we combine experience and dynamism thanks to our team profile.
UK Prime Minister Theresa May has under two weeks to rescue the Brexit negotiations. Last weekend, Sir Keir Starmer QC MP, Labour’s Brexit spokesman and Shadow Secretary of State for Exiting the European Union, hinted at the possibility of his party voting a no-confidence move if May doesn’t move forward the Brexit talks to trade and transition.
Along with Liberal Democrat Spokesperson for Exiting the European Union and International Trade Tom Brake MP, Sir Keir Starmer is now to give evidence to the House of Lords Constitution Committee as part of its legislative scrutiny of the EU (Withdrawal) Bill.
The Constitution Committee has already raised its concerns with the Bill in particular the lack of legal certainty, excessive powers granted to Ministers and the need for meaningful scrutiny by Parliament.
The evidence session will start at 10:15am on Wednesday 29th November in Committee Room 1 of the House of Lords. Tom Brake will speak at 10.30am, and Sir Keir Starmer MP will speak at 11.10am.
Questions will focus on legal certainty, supremacy, the Court of Justice of the European Union (CJEU), the Charter of Fundamental Rights, and devolution. Questions are likely to include:
What do you consider to be the implications of the Bill for the balance of power within the Union and the future of the devolution settlements?
(Source: The House of Lords)
Michel Barnier, chief Brexit negotiator for the European Union, made comments Monday in Brussels on the legal consequences of Brexit. Bloomberg's Emma Ross-Thomas reports on "Bloomberg Surveillance."
Yesterday Phillip Hammond delivered his second and, in some analyst’s eyes, crucial Autumn Budget for the UK. With a range of Tax revisions, changes to the housing market and investment in technology and the NHS there has been some praise for the Chancellor’s proposals.
But what are the implications for the Legal Sector and those they serve? We got the reactions and insights from a host of legal experts across the UK in a special edition of Your Thoughts: Autumn Budget 2017.
Jon Hales, Partner, Womble Bond Dickinson:
There was little in the Budget to help employers, who will see wage bills rise from next April as a result of the increase in the national living wage to £7.83 per hour. The national minimum wage is due to increase as well. There was a hint that the apprenticeship levy may be more flexible in future; this is being kept under review by the Government so we will have to wait and see what they propose.
James Kitching, Corporate Solicitor, Coffin Mew:
This was very much the budget for tech, start-ups, and scale ups. However, the development of new technologies, such as autonomous cars and AI, is very much at the mercy of our legal and regulatory systems. Already there are issues with how fast these kinds of ideas can advance while there are questions about insurance and liability. While producing an environment for greater investment in future technologies is a start, the law needs to adapt to allow our nation to lead the way.
There is talk of making a friendlier regulatory environment but with the fast pace of change, this needs to happen sooner rather than later. Hopefully Philip Hammond and the government recognise this and the ideas in the budget are a start of greater things to come.
Simon Airey, Partner, Paul Hastings:
HMRC is poised for a huge clampdown on tax evasion both in relation to the UK and overseas, energised by September’s Criminal Finances Act. The first quarterly tax returns are due in December and this Budget gives them the tools that they need to strike – more resources on the ground, increased powers of investigation and a much longer time period within which to raise assessments.
These powers are very far-reaching but they are just the latest tools that form part of a comprehensive anti-avoidance and evasion strategy which has been rolled out over recent years. Companies would do well to check that their policies and procedures are up to date. This is not about the finer details of tax law. It’s about compliance and enforcement and, increasingly, criminal law and prosecution.
Richard Morley, Tax Dispute Resolution Partner, BDO:
Although it’s clear that Hammond’s assertion to help first time buyers onto the property ladder by abolishing stamp duty for properties purchased up to £300,000 will perhaps cause most heads to turn, the additional £4.8bn to be raised by 2022/23 through a ‘further set of measures’ should not be ignored. The proposal to consult on extending offshore time limits for ‘non-deliberate offshore tax non-compliance’ is key.
The current non-deliberate time limits are either 4 or 6 years with little or no penalty. The proposal is to extend these time limits to 12 years and if these new rules come in, we will have to see when they will apply from (no surprise if it coincides with September 2018).
Pivotally, any UK Resident taxpayer with offshore interests must take complying with the ‘Requirement to Correct’ very seriously to ensure correct compliance or where non-compliance is identified to make a disclosure before September 2018 before the higher ‘Failure to correct’ penalties come into force.
Jane Mackay, Head of Tax, Crowe Clark Whitehill:
The tax avoidance debate has centred around large multinationals and their corporate tax bills. High profile cases have eroded public trust in how we tax companies. By maintaining the UK’s low corporate tax rate, currently 19%, and reducing it to 17% from 2020, the Chancellor accepts that corporate tax is only of limited relevance in our UK economy. It accounted for around just 7% of UK tax revenues last year.
The Budget announces changes to extend the scope of UK withholding taxes to tax royalty payments in connection with UK sales, even if there is no UK taxable presence. There will be computational and reporting challenges, but this measure may pacify those who feel the UK is not getting enough tax from international digital corporates which generate substantial sales revenues from the UK.
We’d love to hear more of Your Thoughts on Phillip Hammond’s Autumn Budget and what effect it will have on the legal sector. Will it benefit Britain and will it make your work easier? Let us know by commenting below.
Alison Conley, Partner and Head of Retail and Consumer at MHA MacIntyre Hudson tells Lawyer Monthly that retailers’ Brexit plans must prioritise supply chain mapping.
“Political uncertainty and a lack of clarity about the UK’s exit from the EU has made it difficult for retailers to plan ahead, but supply chain mapping needs to be high on the agenda.
“When the UK exits the EU, in the absence of any other agreed arrangements, World Trade Organisation (WTO) tariffs will apply to imports and exports between the UK and the EU, and between the UK and non EU countries with which the EU currently has free trade agreements. This will likely mean increased administration and costs. Retailers need to consider their contractual obligations, the added costs and potential time delays in transit.
“For VAT purposes, goods supplied to UK retailers would become imports and need import VAT to be paid at customs before they can be released. This could create a significant cash flow disadvantage for retailers importing expensive goods, as the VAT will only be recoverable on the next VAT return.
“The impact of customs duty could also be a major issue. If an agreement can’t be reached for the UK to be part of a customs union with the EU, then customs duty may be charged on the import of goods from the EU, which is not recoverable, so would be an actual additional cost for UK retailers. Likewise for UK retailers selling to the EU, the goods may attract duty in the recipient country, potentially deterring EU customers from purchasing from the UK.
“Despite the uncertainty around trade relations, tariffs and VAT, retailers have to plan now and consider all the changes that may lie ahead. Some companies are considering the creation of an EU hub to ensure that they maintain access to the free market, while others are throwing their net further afield and exploring the possibility of extending their supply chain beyond the EU to more price competitive countries. For some companies, moving sourcing back to the UK may be the most appropriate move, although this will obviously depend on the availability of the same quality of product in the UK.”
(Source: MHA MacIntyre Hudson)
The House of Lords Constitution Committee has warned that the Sanctions and Anti-Money Laundering Bill, the first Brexit Bill to be scrutinised by the House of Lords, contains inappropriately broad powers for ministers.
The Sanctions and Anti-Money Laundering Bill is intended to provide a new, long-term legal basis for ministers to make secondary legislation concerning sanctions, money laundering and terrorist financing. The Bill is expected to begin committee stage in the House of Lords tomorrow, Tuesday 21st November.
The Constitution Committee’s scrutiny of the Bill includes:
Chairman of the Committee Baroness Taylor of Bolton said: “The Sanctions and Anti-Money Laundering Bill grants unduly broad powers to ministers and establishes sanctions regimes that will be subject to less scrutiny and challenge than those that exist at present.
“The Bill is the first piece of Brexit legislation to be scrutinised by the House of Lords. The Government should not use the transfer of laws from the EU to the UK as an opportunity to increase its own power, reduce scrutiny, or weaken individuals’ rights.”
(Source: House of Lords)
