BREXIT: A PRELIMINARY LEGAL APPROACH
The outcome of the referendum on the UK’s membership of the European Union poses, both to UK companies or individuals and those from EU, a range of completely new and unpredictable legal problems.
In the light of this, it is recommended a specific study for each case in order to avoid undesirable consequences and, over all, which were not taken into account when the proceeding or the legal relationship began.
Article 50, § 2 and 3, of the Treaty on European Union states:
2. A Member State which decides to withdraw shall notify the European Council of its intention. In the light of the guidelines provided by the European Council, the Union shall negotiate and conclude an agreement with that State, setting out the arrangements for its withdrawal, taking account of the framework for its future relationship with the Union. That agreement shall be negotiated in accordance with Article 218(3) of the Treaty on the Functioning of the European Union. It shall be concluded on behalf of the Union by the Council, acting by a qualified majority, after obtaining the consent of the European Parliament.
3. The Treaties shall cease to apply to the State in question from the date of entry into force of the withdrawal agreement or, failing that, two years after the notification referred to in paragraph 2, unless the European Council, in agreement with the Member State concerned, unanimously decides to extend this period.
Two conclusions could be drawn from these rules:
a) UK’s exit is not automatic, but must take place within time yet to be determined; even the two years period is not mandatory.
b) There is a legal path, although unexplored; this is a negotiated process between the outgoing State (United Kingdom) and the rest of the EU countries. The outcome of such negotiations would shed light on the applicability or not of the EU law over British companies and citizens. Maybe, some EU rules will continue to apply in the future, as a kind of international treaties, as it happens with the particular situation of Denmark regarding some EU rules, such as Regulation 1215/2012.
It is still quite early to say what will happen with such important issues as the recognition and enforcement of the UK judgments in the EU (and vice versa), or if in the UK will be applied the system to determine the law applicable to contracts, or what immigration rules (visas, etc.) will be applied to UK citizens in Spain or how it will affect the freedom of establishment in the EU of British companies …
It is prudent to start working right now in the new legal scenario, anticipating the future; in this regard, for instance, should be initiated the proceedings to recognize and enforce in Spain of the judgments already rendered by UK Courts, because of the ignorance of what will happen in the future with EU Regulations in this field, due to the uncertainty about the transitional rules that could be established.
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