COLLEGE MEETING: ‘No-deal’ Brexit preparedness: European Commission takes stock of preparations and provides practical guidance to ensure coordinated EU approach

These areas include citizens’ residence and social security entitlements, data protection, medicine and medical devices, police and judicial cooperation in criminal matters, and fisheries. The aim of today’s guidance is to ensure the smooth practical implementation of EU and national contingency measures, if the United Kingdom were to leave the EU without a deal on 12 April, or at a later date, ­and to maintain a coordinated approach throughout any such ‘no-deal’ phase. A ‘no-deal’ withdrawal will cause disruption and is not desirable, but the EU is fully prepared for it.

As outlined by President Juncker in the European Parliament on 3 April 2019, should a ‘no-deal’ scenario occur, the UK would be expected to address three main separation issues as a precondition before the EU would consider embarking on discussions about the future relationship. These are: (1) protecting and upholding the rights of citizens who have used their right to free movement before Brexit, (2) honouring the financial obligations the UK has made as a Member State and (3) preserving the letter and spirit of the Good Friday Agreement and peace on the island of Ireland, as well as the integrity of the internal market.

Guidance in 5 areas

1. Citizens’ residence and social security entitlements

The European Commission has consistently made clear that protecting the rights of UK citizens in the EU in a ‘no-deal’ scenario is a priority and that Member States should adopt a generous approach with regards to their rights. The UK is expected to reciprocate this approach. The EU27 Member States have prepared national contingency measures to ensure continued legal residence in the immediate aftermath of a ‘no-deal’ scenario for UK citizens residing legally in the EU27. Today’s guidance provides an overview of the EU’s contingency measures, notably the contingency Regulation on Social Security Coordination. The Commission has proposed that Member States adopt a unilateral coordinated approach to address some issues not covered by the Regulation and, to complement that approach, point to areas where individual Member States could provide further protection through their own national, unilateral measures.

2. Police and judicial cooperation in criminal matters

In a ‘no-deal’ scenario, the EU’s legal framework on police and judicial cooperation would cease to apply to the UK. Cooperation with the UK will therefore have to be based on alternative legal frameworks and cooperation mechanisms, based on international and national law. Today’s guidance outlines the relevant fall-back instruments that the EU and its Member States can rely on to ensure that law enforcement and judicial cooperation can continue in order to guarantee a continued high level of security for citizens. It also provides guidance to Member States on the disconnection of the UK from various EU databases, networks and information systems.

3. Medicinal products and medical devices

The medical sector has been a priority of the Commission’s preparedness work from the very beginning, with guidance being issued already in July 2017. Thanks to preparedness measures, the majority of medicinal products concerned by the UK’s withdrawal should now be compliant with EU legislation as of the UK’s withdrawal date. It is possible, however, that despite best efforts some medicinal products and medical devices may not be compliant in time. There is, therefore, a risk of shortages if economic operators do not act swiftly to remedy the situation. Today’s guidance highlights how the Commission will work with the European Medicines Agency (EMA) and national medicines regulators to monitor the situation closely and address any potential problems. It also outlines the possibilities for making use of exemptions and derogations available from the existing rules, in order to mitigate the risk of shortages of medicinal products and of critical medical devices in case of a ‘no-deal’ scenario.

4. Data protection

As stated in the Commission’s preparedness Communication of 13 November, the Commission considers that the existing tools under the General Data Protection Regulation for data exchange with third countries are sufficient to cater for the immediate needs of data transfers to the UK in a ‘no-deal’ scenario. Today’s guidance provides details on these tools, the well-defined conditions for making use of derogations, as well as on the practical steps that EU companies and authorities will have to take to ensure continued compliance with the EU’s data protection rules.

5. Fisheries

The EU has adopted two contingency measures in the area of fisheries to cover all scenarios under a ‘no-deal’ Brexit. On the one hand, the EU has created the appropriate legal framework to allow UK vessels reciprocal access to EU waters throughout 2019, if the UK grants such access to EU vessels in its waters. On the other hand, the EU has also adjusted the eligibility criteria of the Fisheries and Maritime Fund, to ensure that fishermen who have to cease their activities – in case the UK does not grant continued access to its waters – can receive compensation. In such a case, it would be essential that Member States adopt a coordinated approach to ensure a level-playing field between EU fishermen in different Member States and to protect marine resources. Today’s guidance provides details on such a coordinated approach. The Commission is working with the Member States most concerned on a framework for the monitoring of changes in fishing activities in EU waters, in order to avoid any distortions.

A ‘no-deal’ scenario

In a ‘no-deal’ scenario, the UK will become a third country without any transitional arrangements. All EU primary and secondary law will cease to apply to the UK from that moment onwards. There will be no transition period, as provided for in the Withdrawal Agreement. This will obviously cause significant disruption for citizens and businesses.

In such a scenario, the UK’s relations with the EU would be governed by public international law, including rules of the World Trade Organisation. The EU will be required to immediately apply its rules and tariffs at its borders with the UK. This includes checks and controls for customs, sanitary and phytosanitary standards and verification of compliance with EU norms. Despite the considerable preparations of the Member States’ customs authorities, these controls could cause significant delays at the borders. UK entities would also cease to be eligible to receive EU grants and to participate in EU procurement procedures under current terms.

UK citizens will no longer be citizens of the European Union. They will be subject to additional checks when crossing borders into the European Union. Again, Member States have made considerable preparations at ports and airports to ensure that these checks are done as efficiently as possible, but they may nevertheless cause delays. 

The EU’s ‘no-deal’ preparedness and contingency work

Since December 2017, the European Commission has been preparing for a ‘no-deal’ scenario. To date, the Commission has tabled 19 legislative proposals 18 of which have been adopted or agreed by the European Parliament and Council (see ANNEX 1). Only one proposal on the EU budget for 2019 is to be finalised by the two co-legislators in due course. It will apply retroactively from the withdrawal date, once finalised. The European Commission also published 92 sector-specific preparedness notices with detailed guidance to the different sectors affected by Brexit.

As outlined in the Commission’s Brexit Preparedness Communications, the EU’s contingency measures will not – and cannot – mitigate the overall impact of a ‘no-deal’ scenario, nor do they in any way compensate for the lack of preparedness or replicate the full benefits of EU membership or the favourable terms of any transition period, as provided for in the Withdrawal Agreement. These proposals are temporary in nature, limited in scope and will be adopted unilaterally by the EU. They are not ‘mini-deals’ and have not been negotiated with the UK. 

The Commission has also held extensive technical discussions with the EU27 Member States both on general issues of preparedness and contingency work and on specific sectorial, legal and administrative preparedness issues. The Commission has also completed a tour of the capitals of the 27 EU Member States. The aim of these visits was to provide any necessary clarifications on the Commission’s preparedness and contingency action and to discuss national preparations and contingency plans. The visits showed a high degree of preparation by Member States for all scenarios.

Member States have also been engaged in intensive national preparations. An overview of residency rights in the EU27 Member States is available here, as well as direct links to national preparedness websites.

Financial Support

While the impact of a ‘no-deal’ scenario will be felt throughout the European Union, it is clear that some regions and economic sectors will be affected more directly. The Commission has explored how current EU funds and programmes could be mobilised in case of a ‘no-deal’ and in the case the UK fails to pay what is envisaged under the contingency EU budget Regulation. By reprogramming certain structural funds, activating measures against disturbance of agricultural markets, and using specific instruments such as the programme for Competitiveness of Small and Medium-Sized Enterprises (COSME), the European Globalisation Adjustment Fund (EGF), the Solidarity Fund and the European Fund for Strategic Investment (EFSI), additional dedicated funding can be made available.

Technical and financial assistance from the EU can also be made available in certain areas, such as the training of customs officials under the Customs 2020 programme. Other programmes can help similar training projects in the area of sanitary and phytosanitary controls. For agriculture, EU law provides a variety of instruments to cope with the most immediate effects of the withdrawal of the UK, in particular in a no-deal scenario.

For more immediate support to affected stakeholders, for example small and medium-sized companies with a significant exposure to the UK, EU State aid rules offer flexible solutions for national support measures.

For more information: what should I do in a ‘no-deal’ scenario?

To know more about how to prepare for a ‘no-deal’ scenario, EU citizens can contact Europe Direct for any questions. Call Freephone 00 800 6 7 8 9 10 11 from anywhere in the EU, in any official EU language (see factsheet here). 

Further useful links:

EU citizens

–      Today’s Communication and annexes

–      European Commission preparedness website

–      Overview of residence rights in each EU27 Member States

–      Member States national ‘no-deal’ websites

–      Notice on Travelling

–      Factsheets on travelling, citizens’ rights, studying, and consumer rights

–      Q&A on Erasmus

–      Q&A on a ‘no-deal’ scenario

–      Information for EU citizens living in the UK

EU businesses

–      A range of materials on customs and indirect taxation (including a simple 5-step checklist) for businesses

–      Information related to Agriculture

–      Seven Things Businesses in the EU27 need to know in order to prepare for Brexit

ANNEX 1: The ‘no-deal’ contingency measures

–      PEACE programme: the continuation of the PEACE programme on the island of Ireland until the end of 2020. As for the period after 2020, the Commission has already proposed as part of its proposals for the next Multi-annual Financial Framework to continue and strengthen cross-border support for peace and reconciliation in the border counties of Ireland and Northern Ireland.

–      The EU Budget (in the process of final adoption): in a ‘no-deal’ scenario, the EU will be in a position to honour its commitments and to continue making payments in 2019 to UK beneficiaries for contracts signed and decisions made before withdrawal, on condition that the UK honours its obligations under the 2019 budget and that it accepts the necessary audit checks and controls.

–      Fishing rights and compensation: these measures provide for compensation for fishermen and operators from EU Members States under the European Maritime and Fisheries Fund for the temporary cessation of fishing activities. It also ensures that the EU is in a position to grant UK vessels access to EU waters until the end of 2019, on the condition that EU vessels are also granted reciprocal access to UK waters

–      Financial services: temporary, limited measures to ensure that there is no immediate disruption in the central clearing of derivatives, central depositaries services for EU operators currently using UK operators, and for facilitating novation, for a fixed period of 12 months, of certain over-the-counter derivatives contracts, where a contract is transferred from a UK to an EU27 counterparty.

–      Air connectivity and safety: these two measures will ensure basic air connectivity in order to avoid full interruption of air traffic between the EU and the UK in the event of a “no-deal” scenario. 

–      Road connectivity: allows for the continuation of safe basic road connectivity between the EU and the UK for a limited period of time, provided that the UK gives reciprocal treatment to EU companies and operators.

–      Rail connectivity: ensures the validity of safety authorisations for certain parts of rail infrastructure for a strictly limited period of three months to allow long-term solutions in line with EU law to be put in place. This is, in particular, related to the Channel Tunnel and will be conditional on the UK maintaining safety standards identical to EU requirements.

–      Ship inspections: this aims to ensure legal certainty and secure business continuity in shipping.

–      Re-alignment of the North Sea – Mediterranean Core Network Corridor: This adds new maritime links between Ireland, France, Belgium and the Netherlands to the core network, and introduces a new funding priority to the Connecting Europe Facility (CEF): adapting transport infrastructure for security and external border check purposes.

–      Climate policy: this measure ensures that a ‘no-deal’ scenario does not affect the smooth functioning and the environmental integrity of the Emissions Trading System.

–      Visa reciprocity: visa-free travel to the EU for UK nationals if the UK also grants reciprocal and non-discriminatory visa-free travel to all EU citizens.

–      Social security entitlements: the entitlements (such as periods of insurance, (self) employment or residence in the UK before withdrawal) of those people who exercised their right to free movement before the UK’s withdrawal are safeguarded. 

–      Erasmus + programme: students and trainees abroad participating in Erasmus+ at the time of the UK’s withdrawal can complete their studies and continue to receive the relevant funding or grants.