EU & Competition Law

Brexit implications

The UK exited the European Union on 31st January 2020. We are now in a transition period by virtue of the UK-EU Withdrawal Agreement during which EU law will continue to apply in and in relation to the UK.

The transition period will end on 31 December 2020 (the UK had until 11pm (UK time) on 30 June 2020 to request an extension to the transition period, which it did not exercise).

The process and negotiations for the UK to exit the European Union have been extremely complex. However, we have a picture of how competition law will continue to apply during this transition period.

For the duration of the current transition period EU competition law and jurisdiction will continue to apply to the UK as if it were still a Member State of the EU. This means that Articles 101 and 102 of the Treaty on the Functioning of the European Union (TFEU), the EU Merger Regulation (EUMR) and the EU block exemption regulations will continue to apply. The State aid rules in Articles 107 to 109 TFEU will also still apply during this period. UK undertakings will continue to be bound by the European Commission (Commission), and court decisions adopted pre-Brexit and before the end of the transition period. Likewise, the Court of the Justice of the European Union (CJEU) will also have exclusive competence to review the legality of the decisions made during this period.

From January 2021 – post-transition period – the expectation is that the Competition and Markets Authority (CMA) will only be able to enforce UK (not EU) competition law, and that the CMA will have jurisdiction over matters, which were previously reserved exclusively for the Commission. However, this is an ever-evolving area.

Clearly, the political and economic background since the referendum on 23rd June 2016 has been changing at a pace in both the UK and the EU which has led to a great deal of uncertainty. Most recently this has been further de-stabilised by the COVID-19 pandemic. We, therefore, recognise that, more so than ever, businesses are looking for stability and clarity. Like any other advisers, we cannot accurately predict the outcome of the negotiations post-transition period, however what we can do is provide our clients with a full range of services and support that will be of practical use during this continued period of uncertainty. We will meet you wherever you are at and work together to move through and beyond this period.

Exploring the possible outcomes, we can see a number of potential implications for businesses and we can help you carry out assessments and assist in preparing mitigation strategies. We have created a simple checklist to assess whether your business is Brexit ready.

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