Brexit update - Where are we now?

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2020 has already thrown up so many challenges that have unexpectedly impacted the sport and recreation sector.

However, one issue that was always anticipated has now loomed back into view as a crucial Brexit deadline has now passed. 11pm on 30 June marked the deadline for any extension to be agreed and, as expected, no agreement was sought or made.

The UK and EU remain in negotiations to agree the basis of their future relationship beyond Brexit. The negotiations cover a wide range of issues including the future trade relationship, fisheries, aviation, security co-operation, governance and dispute resolution.

Following the UK’s formal exit on 31 January, the UK is in a transition period during which EU law continues to apply and day-to-day arrangements continue as if the UK were an EU member state. However, the UK is no longer a member of the political institutions of the EU.

The transition period is set to expire on 31 December 2020. To avoid a new cliff edge, the UK and EU have just six months to negotiate and ratify an agreement. Failure to do so would lead to a huge overnight change in the UK’s relationship with the EU and likely severe economic impacts.

Even if an agreement is reached, the UK government has made clear that it will be leaving the EU single market and customs union and wants the freedom to diverge from the EU in key areas.

This means UK organisations and individuals will need to make practical adjustments to deal with the new reality which would include completely new border and immigration arrangements.

And all of this is happening against the backdrop of the COVID-19 pandemic. The Alliance’s Head of Policy, Leigh Thompson guides us through some of the most important questions.

What is significant about 30 June?

30 June was the last date by which the transition period could be extended under the terms set out in the Withdrawal Agreement.

Can the transition period be extended even though the 30 June deadline has passed?

Yes, but only through a limited number of mechanisms which are legally and technically complex and which have no guarantee of success.

But what about COVID-19? Has the government considered extending the transition period due to the pandemic?

The UK government’s position is that under no circumstances will it seek an extension. This position has not changed despite the emergence of COVID-19.

What happens if no agreement can be reached by 31 December?

If the UK and EU cannot agree a deal by the end of the year, the UK and EU relationship will change fundamentally overnight.

The UK and EU would revert to trading on basic World Trade Organisation (WTO) terms and would have to rely on previous international treaties or in some cases possibly temporary measures to govern activities in a wide range of other areas.

Is no agreement on the future relationship the same as no deal in October 2019?

Not quite. The Withdrawal Agreement now in place protects citizens’ rights and commits the UK to the financial settlement agreed with the EU and implementation of the Northern Ireland protocol.

But in most other respects, the impact would replicate a no deal scenario unless specific measures are agreed or taken unilaterally by the EU.

What are the implications for sport and recreation?

If there is no agreement, the sector will face many of the same challenges it would have faced under the original no deal scenario.

To give a few examples, additional trade barriers and border checks would impact upon the trade in sporting goods and equipment, organisations and individuals in the sports sector would face additional hurdles providing services to EU markets, the cross-border transfer of data between EU and UK organisations would be restricted and UK organisations would not be part of EU programmes such as ERASMUS+.

Even if there is an agreement on a future relationship, the shift from the status quo will be marked and there may be little time for UK organisations to make adjustments.

What should I be doing now?

You should continue to keep updated with the latest developments on Brexit via our website and social media and ensure that you are able to prepare as much as possible if it looks like there won’t be an agreement.

You should also look at our Brexit guidance produced last year which remains relevant and will help you identify some key practical steps you can take to prepare.