Brexit – noteworthy dates

Brexit has brought an air of uncertainty for companies operating in and doing business with the United Kingdom.  As no country has left the EU before, no one knows what the process looks like and what impact it will have on businesses. The negotiations are still ongoing and in order to be as prepared as can be, companies are advised to keep an eye on official updates from the European Union and the British government so as to know where to focus efforts.

Below are some noteworthy dates to keep in mind to stay up to date with the latest updates on the Brexit process.

2018

17-18 October

EU summit. The official deadline for setting out the terms to be included in the withdrawal agreement for the “divorce” between the EU and the UK.

End of October

The Withdrawal Agreement is expected to be finalised.

November

EU has suggested this month as the latest a deal can be finalised. However, an exact date has yet to be agreed.

13-14 December

EU summit. This is the fall-back option in case no deal has been reached by October and both sides continue to want to reach an agreement.

 

2019

21 January

If the withdrawal agreement has not been presented by the government on this date, the Members of Parliament (MPs) will be granted powers to influence ministers’ next steps.

21-22 March

The final summit that the UK is expected to attend as a member of the EU.

Before 29 March

The European Union (Withdrawal Agreement) Bill needs to be approved and passed by Parliament to implement the agreement.

26 March at 11:00pm GMT

The UK leaves the EU.

23-26 May

Elections for the European Parliament in 27 EU countries – the UK will no longer be represented.

 

2020

31 December

Expected to be the last date of the transition period

 

Stay up to date on Brexit!

There are many ways you can stay updated about Brexit with Goodwille.

Sign up to our Brexit Newsletter to receive updates and developments of the Brexit negotiations straight to your inbox.

On our Brexit page, we have also consolidated everything discussed about to date to provide you a resource where you can track the developments of the negotiations as they happen.

Additionally, Goodwille has created a committee to monitor the progress of Brexit from a European perspective as well as the UK one. Feel free to contact us if you have any questions about how Brexit will impact your business in or with the UK post-Brexit.


This update is for general guidance only. Specific legal advice should be obtained in all cases. This material is the copyright of Goodwille Limited (unless otherwise stipulated) and is not to be reproduced in whole or in part without prior written consent.

Can London tech businesses boost economic growth in a post-Brexit UK?

Brexit continues to occupy much of the space in the British and international media, with debate ongoing as to what the UK’s withdrawal from the EU will mean for business.

Recent government impact studies have shown that as much as 8% could be chipped off Britain’s GDP if the UK leaves the EU with no deal in place. Five percent of GDP will apparently go missing if they conclude a free trade agreement with the EU, according to the leaked reports published by BuzzFeed.

Even if Britain stays in the European Economic Area after leaving the EU, the damage will still be around 2% of GDP, according to the leaked impact assessments. Those figures suggest that some serious innovation will be required by businesses to keep the British economy on track and moving in a positive direction.

So what can be done? Well, tech startups in London could be a big part of the answer. If anyone is wanting to set up a UK company of this type, London is a good city to choose. There are a number of reasons for this.

Tellingly, London has a youthful, dynamic and diverse population, that is also very large. A massive chunk of the city’s population is classed as being millennials, a demographic which is naturally drawn to technology companies.

An indicator of the opportunities available to companies who set up in this part of the UK is that in 2015, London-based start-ups created 20,000 new jobs. They also managed to raise £1.3 billion. Now, in 2017, there is also a massive availability of investment platforms and accelerators, which can help a new business in London grow. These include TechStars, Crowdcube and Shell Livewire.

If you are looking to set up a new company in the UK, or diversify some of your operations by expanding your current business from overseas into the UK, then London is a good place to look. This is especially true for tech companies. There is a ready supply of workers and customers in one of the world’s most international cities. Brexit may well be on its way, and casting a shadow over the UK economy, but the opportunities to thrive in a city like London are still there to be grasped.

With years of experience helping foreign tech startups establish in the UK, Goodwille can help you with everything you need to succeed on the UK market.
Get in touch with us today if you need any advice or help with your company expansion.


Are you worried about what impact Brexit might have on your future possibilities to do business? We have consolidated everything you need to know about Brexit on our Brexit Tracker. The Tracker is updated as discussions go along, so it’s always up to date with the most recent progress of the Brexit negotiations. You find the Brexit Tracker on goodwille.com/brexit.

Launch in London – London Tech Week 2018

London Tech Week is getting closer, and so is our event Launch in London! We have a great outline of speakers, lots of interesting people signed up and a superb location boiling of creativity and entrepreneurship so we are certain that this will be one of the highlights of London Tech Week 2018!

There are still some free tickets left, but since capacity is limited we advise you to grab yours as soon as possible! Get your tickets through this link, just click the purple ‘Register’ button on top of the page, type in your details and you’re good to go!

ABOUT LAUNCH IN LONDON

Join us on 14 June for Launch in London – London Tech Week’s hottest event for any business establishing in the UK!

Hosted by Goodwille at Level39, one of the world’s most well renowned and connected tech hubs, Launch in London will provide you with everything you need to succeed with your business in London. Get inside tips on the Do’s and Don’ts when starting up in the UK, how to navigate Brexit, the British business culture and how to grow your network with the right people, all while overlooking London’s skyline.

This is THE event for startups, entrepreneurs and businesses looking to establish in London, as well as for mentors and advisors helping tech businesses succeed on London’s tech scene.

SPEAKERS
Alexander Goodwille, CEO of Goodwille will share the best tips, and the pitfalls to avoid when starting up in the UK.

Mark Leaver, Creative Industries Specialist of DIT – Department for International Trade will discuss why despite Brexit, the UK is still very much open for business and why you should start your business in London during 2018.

Joanna Dodd, Director of Rochester PR will share helpful insights on marketing, PR & how to get connected with the right people in the UK.

Joanna Smit, Owner of SMIT Training will help you understand the British people and culture and provide you with the intercultural skills you need to make your transition in to the UK market.

The seminars will be followed by a Q&A session, drinks, canapes & networking (plus opportunities for panoramic photographs of London!).

EVENTS DETAILS
Date: Thursday 14 June 2018
Time: 10am-1pm
Location: Level39, One Canada Square, Canary Wharf, London E14 5AB
Free entry

REGISTER FOR THE EVENT HERE


If you have any questions about the event, get in touch with our Marketing Manager James Service on james.service@goodwille.com or 020 7795 8100.

HMRC announcement on EMI options

HMRC have announced that the EU State Aid approval for the EMI scheme expires on the 6th April 2018.

The UK Government has applied to the European Commission, but it is has now been made apparent that it will lapse before new approval is obtained. HMRC considers that the State Aid approval applies to the granting of share options and therefore that share options granted up to and including 6 April 2018 won’t be affected by this lapse in approval. HMRC will, up until the 6th April 2018, continue to apply its current guidance & practice in relation to employment-related securities options validly granted as EMI share options.

Therefore:

  1. EMI share options granted between the period of the 7th April through until the new EU State Aid approval may not be eligible for the previous tax advantages.
  2. Organisations may wish to consider delaying the grant of EMI options until the EU State Aid approval is obtained.

For more information on how this may impact your existing EMI scheme do not hesitate to contact our Corporate Legal department.

Freedom of Establishment – Corporate Mobility

Often labelled as “passporting”, Corporate Mobility means that once a company is established in one EU member state, others will need to recognise it as validly established legal entity. As a result, an established company can sell goods or services to other EU countries, in principle without needing to establish a branch or subsidiary there.  In some instances, member states’ tax rules will still require establishment of a local entity. An example here is the UK legal obligation to form a “UK establishment” (subsidiary or branch) when certain criteria are met. Several questions come to mind in relation to the future of this freedom…

Will you need to establish an entity in the UK to run operations smoothly?
If you have a UK Branch, should you form a subsidiary to strengthen your UK base?

Answers to these questions will vary depending on where your company is based, as well as what Brexit scenario the future holds – will there be a “hard Brexit” or not, how long is the transition period, will Mrs May negotiate a solution for corporate mobility?

To illustrate the background: Most continental EU jurisdictions (e.g. France, Germany) adopt the “Real Seat Theory”. This means the company will follow the company law where it has its real seat, being the location of the company’s centre of management or central administration. The second theory, called “Legal Seat Doctrine” (adopted, for example, in England), the applicable company law is determined by the jurisdiction where the company is incorporated.

This means that a UK established company, whether or not it is a foreign subsidiary or not, will retain its legal status in the UK irrespective of the Brexit model applied. Depending on business carried out in other EU member states, your UK established company may need to explore whether you should set up an entity in another EU country if you do not currently have such an entity. This will be particularly relevant for companies registered in one of the UK jurisdictions but having their central administration in a “Real Seat Country”.  Those types of businesses may risk to be regarded as unincorporated associations following Brexit, thus potentially losing their status as legal entity in those other member states.

On the flip side, if you are currently operating an entity outside the UK and are carrying out regular business with the UK, you may not have the benefit of being regarded as legal entity in the UK. Depending on your exposure to the UK market and business plans, you may wish to consider setting up a UK Limited company to strengthen your base. Whilst it is not possible to advice on what precisely will happen, we have seen this used as a contingency approach during less certain times.

Watch this space for a detailed analysis on any indications we have seen so far on how the UK is looking to fare with your Corporate Mobility!

 

 

If you have any questions about Corporate Mobility,
get in touch with Tessa Schrempf,
Corporate Legal Controller at Goodwille.
tessa.schrempf@goodwille.com

 


This update is for general guidance only. Specific legal advice should be obtained in all cases. This material is the copyright of Goodwille Limited (unless otherwise stipulated) and is not to be reproduced in whole or in part without prior written consent.

Free Movement of Goods

The free movement of goods is one of the cornerstones of EU law and business. It essentially is a two-sided coin, and provides for tariff‑free access to the single market and the elimination of non‑tariff barriers such as product regulation and approvals.

The issue concerning the status of UK rules vis-à-vis laws pertaining to the movement of goods and services, as well as changes to the VAT system, increasingly captivates our interest day by day. As the UK hopes to achieve a bespoke agreement, the British government will seek to maintain the closest relationship with the EU and, as UK Prime Minister Theresa May was heard saying during her Florence speech, a frictionless trade agreement between the bloc and the UK. The Draft Withdrawal Agreement published on 19th March 2018 supports this approach. One of the clauses both parties have agreed on stipulates that any good that was lawfully placed on the EU or UK market before 31st December 2020 should be able to continue to circulate freely until reaching the end-user. The existing rules on free movement of goods will largely remain in force during the Transition Period, with some applicable exceptions.

These developments are at least an interim departure from Mrs May’s ruling out of remaining in the single market or customs union. It remains to be seen how the post-Transition Period deals with the matter of freedom of goods, but future developments do not necessarily threaten frictionless EU-UK trade. UK industries and their respective sectors are highly integrated with the single market; the Office of National Statistics (ONS) state that over 59% of UK imports are of EU origin, whilst 48% of UK exports end up within the community.

It would not be in Britain’s interest to lose free-trade access to the EU, as the UK would lose access to countries with which the EU and European Economic Area (EEA) have also been negotiating free trade agreements. Moreover, a weakened Pound Sterling at the outset of the June 2016 Referendum, has seen demand for UK-built goods abroad increase, as exports became cheaper, and tourism saw improvement, where visiting the UK became more affordable. There is scope to protect frictionless trade in goods and services and to secure proper VAT processes following Brexit.

VAT and the flow of goods and services are symbiotic, and they will adhere too much of PM May’s rhetoric concerning the maintenance of seamless trade with the EU – predictability. Voices that declare that Brexit means “taking back control” are purported, as past decisions made by the European Court of Justice will be influential in the continued interpretation of VAT law in British law. The EU VAT Directive have been soaked up by British courts, and this is another signal that the path Britain is taking concerning goods, services and VAT will be governed by the virtues our company seeks to aspire to: predictability and reliability.

Additionally, issues concerning the future of services or goods do not seem to be so challenging at this stage, many self-accounting rules for VAT on services bought from the EU will remain broadly unchanged and there could be further opportunities; especially if one considers that EC Sales List declarations may not need to be completed. This suggests an orderly process of transposition and transition in a post-EU UK as being the name of the game.

In areas concerning the exchange and freedom of movement concerning technologies, the UK seeks to maintain its position as a leading provider and market for hi-tech industries. Upon reading the UK’s Industrial Strategy Paper in November, the UK seeks to increase innovation by raising total research and development investment to 2.4% of GDP by 2027. Over £1 Billion will be invested to boost Britain’s digital infrastructure, £176million for 5G and £200million invested to foster full-fibre networks in the UK. Equally important is the UK’s drive to invest £20 billion into innovative and high potential businesses.

 

 

If you have any questions about Free Movement of Goods,
get in touch with Alexander Goodwille,
CEO at Goodwille. 

alexander.goodwille@goodwille.com

 


This update is for general guidance only. Specific legal advice should be obtained in all cases. This material is the copyright of Goodwille Limited (unless otherwise stipulated) and is not to be reproduced in whole or in part without prior written consent.

Free Movement of People – Individual Mobility

By law, this freedom is called “Freedom of Workers”. We have expanded the notion here as in practice, it relates to more than just EU workers and includes for example family members and jobseekers, but also students and unemployed Union citizens. We have picked out the three most relevant categories here below.

Brexit for Employees

There has been a lot of speculation over the past 2 years around Brexit which has perhaps meant that many non-British citizens are questioning the security of their current situation in the UK. The key information is that there will be no change to the legal rights of EU nationals living in the UK until at least 31st December 2020, or later if there is an extension.

In December 2017, the UK Government announced that an agreement had been reached with the European Commission on citizens’ rights, whereby EU citizens who arrive in the UK by 29 March 2019 will be entitled to apply for “settled status” (see below) when they have five years’ continuous residence in the UK. However, the Draft Withdrawal Agreement published on 19th March 2019 confirmed that free movement of people will be extended to the start of 2021. This recent assurance means that EU Nationals arriving in the UK would be able to stay in the UK indefinitely and also access work permits via the new immigration regime.

Did you know…

  • Currently, citizens of EEA countries and Switzerland plus any non EEA family members can live and work in the UK and do not need any specific permission to do so at present, however in the interests of security and perhaps reassurance, it could be beneficial to formally request documentation.
  • There are pro’s and cons regarding applying for Permanent Residency at this time and also criteria as to whether an individual has this option open to them, i.e. one stipulation is that an individual must have been a continuous resident in the UK for 5 years or more.
  • Currently anyone who is an EU citizen living and working in the UK does not have to make an application to preserve their rights at this time; and indeed the Home Office are encouraging EU citizens to not make applications just now as they are inundated with applications.
  • There will however be the need to demonstrate via documentation in the future that an individual has the right to live and work in the UK. This could be via Permanent Residency, British Citizenship or Visa, but the longer term plan would be that individuals who do not hold visa status will apply for Settled Worker status (which will be discussed later in the newsletter). Those currently holding Permanent Residency will also need to apply for Settled Worker status.
  • Key areas which individuals may want to consider are whether they wish to be British (British Citizenship or Settled Worker), whether they would like the right to vote in the UK, whether holding dual citizenship is a possibility, whether they have EU family members who they would like to bring with them to live in the UK (as the British Immigration rules may be more restrictive than those currently enforced under the EU) and their taxation status.

Brexit for Employers

As discussed above, immediate uncertainties over the immigration status post-Brexit were addressed in the Draft Withdrawal Agreement confirming EU citizens’ rights to remain unchanged until 31st December 2020. As previously, this means for the moment there is no issue for EU nationals to live and work in the UK. Irrespective of the recent assurances, employers need to think about future proofing their business, which of course means looking at how the company can support both current non British employees and also potential hires from outside the UK.

Some thoughts to bear in mind:

  • Consider the workforce and how many non-British employees are in the business or British employees who may have non-British spouses.
  • What can your business afford by way of assistance? Consider presentations explaining the current status re immigration and Brexit and also presentations to assist with applications. Perhaps you can afford to pay for some legal support for employees who may be affected?
  • When you are hiring non-British employees, consider that they may wish to have some reassurance from you that post Brexit, should they not be in a position to stay and work in the UK that they will have some support, this could be by way of a clause in a contract, legal assistance, relocation package etc.
  • There is an expectation that there will still be a high requirement for EU talent in the UK post Brexit. There is a continuing skills shortage in the UK particularly within Tech.
  • There may be a greater need for UK Companies to apply for sponsorship licences to perhaps cover both EU talent and also of course talent from outside of the EU (as is current practice).
  • There are an expanded list of sponsorship licence categories and Companies need to decide which (if any) are more appropriate for them if needed.
  • There is an expectation that there will be greater restrictions on low skilled workers looking to work in the UK with visa’s capped at 2 years. This cap is also to extend to high skill workers with some visa categorisations, where they will be able to stay for 5 years without settlement status.
  • Companies should think about ensuring they are tightening up their compliance checks, including Right to Work checks (which are the minimum which an employer has a responsibility to carry out currently). Compliance is extremely important for sponsorship licences and failure to comply could mean loss of licences and the personnel sponsored by the Company.

Settled Worker Status

In December 2017, the Government announced that it had reached an agreement with the European Commission on citizens’ rights, under which EU citizens arriving in the UK by 29 March 2019 will be entitled to apply for “settled status” when they have five years’ continuous residence in the UK. This will give them the right to stay indefinitely. Settled Status is currently known as Permanent Residence, however those currently living and working in the UK under a Permanent Residence agreement will need to also apply for Settled Status.

Applicants who are not able to give evidence of five years’ continuous residence necessary to obtain settled status, but who can evidence that they were resident before the specified date, will be given temporary status. This means that they will be given the opportunity to build up the required longevity of residency to be able to apply for Settled Status.

 


If you have any questions about Individual Mobility,
get in touch with Jacqui Brown,
HR Manager at Goodwille. 

jacqui.brown@goodwille.com

 


This update is for general guidance only. Specific legal advice should be obtained in all cases. This material is the copyright of Goodwille Limited (unless otherwise stipulated) and is not to be reproduced in whole or in part without prior written consent.

The Key Aspects of the Draft Withdrawal Agreement

The key aspects of the Draft Withdrawal Agreement announced in Brussels on 19th March are:

  • The Transition Period will last from Brexit Day on 29th March 2019 until 31st December 2020
  • UK citizens arriving in the EU, and EU citizens arriving in the UK during the Transition Period will enjoy the same rights and guarantees as those who arrive before Brexit Day.
  • The UK will remain party to existing EU trade deals with third countries, but will simultaneously be able to negotiate, sign and ratify its own trade deals during the Transition Period
  • The UK will remain part of the Common Fisheries Policy during the Transition Period, yet without a direct say in its rules. The UK’s share of fishing catch will be guaranteed until the end of 2020. Through 2020, the UK will be negotiating fishing opportunities as an independent coastal state.
  • The issue of Northern Ireland remains a key point of negotiations. In all likelihood, NI will effectively stay in parts of the single market and the customs union in order to avoid a ‘hard border’ with the Republic of Ireland.

This update is for general guidance only. Specific legal advice should be obtained in all cases. This material is the copyright of Goodwille Limited (unless otherwise stipulated) and is not to be reproduced in whole or in part without prior written consent.

Our guide to become GDPR compliant

As advisors supporting businesses in the UK, we would like to inform you of the new Data Protection legislation, the EU General Data Protection Regulation (GDPR), and its related implications for your business. We want to ensure that you are aware of the new legislation, what measures your company have to take in order to comply with the regulation, and how Goodwille can assist you in becoming GDPR compliant. This guide provides an overview of the new regulation, and what you can do to ensure you and your business are prepared for the changes to existing legislation.

The GDPR is enforced on 25 May 2018, replacing the existing EU Data Protection Directive. The regulation significantly increases the obligations and responsibilities for businesses in how they gather, use and protect personal data. At the same time it strengthens European citizens’ data privacy and right to access their personal data by setting out additional and more clearly defined rights for individuals whose personal data is stored by businesses.

Below are some of the main considerations on how to prepare to become a GDPR compliant organisation:

Identify problem areas in your business by reviewing and enhancing your organisation’s risk processes

This can be done by making an inventory of all personal data the business holds, why the business holds it, if it is still needed, and if the data is safely stored.

Communicate with your clients and employees

You will need to ensure that your clients and employees are fully informed about how their data is used and that your company has procedures in place cover all the rights individuals are entitled to, e.g. the right to access their data or have it erased from your systems.

Data subject access request

Every individual has the right to make a data subject access request. This means that the individual has the right to obtain all the personal information your company stores about the individual within one month from the date the request was made. You will need to ensure that you have measures in place to deal with any such request within one month’s time.

Consent to store individuals’ data

An individual’s expressed consent has to be freely given for a company to be allowed to gather and store any personal data. Note that an individual cannot be forced into consent or be unaware that they are consenting to their data being stored e.g. through pre-ticked boxes, but the consent has to be actively given by the individual.

It is essential that your business is mindful of data privacy in all ongoing and future projects, as you will face heavy fines if not. The GDPR is based on the one stop shop mechanism signifying that organisations engaged in cross-border processing of personal data will deal with a single lead supervisory authority. Your company’s lead supervisory authority will be the authority of the country in which your business has its main establishment.

To ensure that your business is compliant before 25 May, it’s time to put a GDPR policy in place or draft board minutes to show that your company is working towards becoming GDPR compliant. Goodwille are happy to provide you with further guidance on the GDPR, help set up a company policy or draft board minutes containing information on how your company is working towards complying with the regulation. Get in touch with our Corporate Legal team today for assistance or if you have any questions. This article also provides a good foundation for understanding the GDPR and its implications for your business.

 

GDPR and your business

Any business looking to set up a subsidiary in the UK, or anywhere in the EU, will have to have at least a basic understanding of the General Data Protection Regulation (or GDPR). The Regulation is the biggest shake-up of individual rights to their personal data of the Internet age and will have a major impact on how data is stored and shared within and without the EU.

What has changed?

From May 25 2018, the regulations change to unite all local privacy laws across the EU – changing the definition of what constitutes personal information to include names, photos, email addresses, and even a computer’s IP address. This applies across a person’s whole life, there is no distinction between a personal email and a work email, for example.

The new rules also introduce new rights for consumers, including the right to be forgotten, the right to know what data is held, the right to object to receiving marketing and the right to have information about them corrected. This means that explicit consent must be received from the consumer for each use of their data before it happens, meaning separate consents are needed for different activities.

What does it mean for my business?

It is vital that businesses comply with the new regulations, with tough penalties in place for non-compliance, up to a 4% fine of global revenue. This applies even to non-EU companies who hold the data of EU citizens, or EU companies who process data outside the Union. While it is a good idea to appoint someone to oversee the transition to the GDPR rules and ensure compliance, it is more than just an IT issue. Sales and Marketing are two of the areas most directly affected.

The most important measures to take are to ensure that you have procedures for properly obtaining the right consents from customers, a policy on what data is kept, where and why, storing the data securely, ensuring that old data is deleted and ensuring there is a procedure for deleting or amending data when requested.

While most of these needs are just good housekeeping anyway, they will soon be enforceable by law. It is very important that all businesses not only understand what GDPR means, but that they also have a plan to transition. Our team of legal experts can help you with guidance and answer any questions you may have about GDPR and how it can affect your business. Get in touch with us today!