Planning for Brexit

Lawyers are focused on the implications of Brexit, with two weeks left before the UK goes to the polls.

Larger firms have created Brexit teams and issued briefings to advise clients on the consequences of leaving the UK.

Berwin Leighton Paisner, for example, is advising its clients to ensure contracts are “future-proofed” to provide for the implications of a Brexit, and to plan for negative consequences and opportunities.

One major repercussion for businesses would be the impact on data privacy. These are “tumultuous” times for businesses that need to transfer electronic data, according to Lauren Grest, legal researcher, Kroll Ontrack, and Mark Surguy, partner at Weightmans. The proposed EU-US Privacy Shield—the replacement for the Safe Harbor agreement—is still being debated, while the General Data Protection Regulation (GDPR) is due to take effect in 2018.

Writing in NLJ this week, Grest and Surguy spell out the key questions: what legislative regime would govern the UK, and how would the UK do business with the EU if the UK does not have to comply with the GDPR?

While it would be a relief for many businesses not to have to comply with the “onerous” GDPR, which requires companies to nominate a compliance officer, they would discover a “whole new web of red tape” once new agreements were negotiated. The UK would have to be declared a “safe area” therefore comply with GDPR requirements. It could end up in the same boat as the US, which is still struggling to negotiate the EU-US Privacy Shield. The combined power of 27 countries “has formidable leverage in negotiations”, Grest and Surguy say, and a post-Brexit UK could end up subject to GDPR just as much as if it had never left.