The transition period ends at 11pm on 31 December 2020. However, MEPs will vote to accept or reject the deal, and have said they need six weeks for the deal to be scrutinised, pass through committee and pass through the full plenary vote. The vote is scheduled for 16 December, although it is widely reported discussions have taken place about a possible extraordinary sitting of the European Parliament on 28 December.
The deal must also be approved by MPs. Sticking points in negotiations reportedly include fishing rights, mechanisms for resolving disputes, fair competition rules for business and rules on domestic subsidies.
Hogan Lovells partner Charles Brasted said: ‘We know that no deal will be comprehensive.
‘The scope of any deal, and the extent to which it pushes off the detail to later, will determine how much will change on 1 January. One thing that we know will change is how many rules are interpreted and applied in the UK.
‘Vast amounts of previously EU-derived law and regulation in the UK will be on a new legal footing from 1 January 2021 and potentially open to reinterpretation in its new post-Brexit context. Businesses in the UK whose operations are currently affected by EU law should take notice and be prepared to manage the risks and capitalise on the opportunities that could arise from this legal uncertainty.
‘Any area of law, regulation or policy in the UK previously touched by EU law, is potentially affected. Businesses and their advisors cannot assume that familiar laws and rules will not become faux amis.’
During the transition period, EU law has mainly continued to apply in the UK as before.
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