Brexit - Corporate

The impact of the Brexit vote on the UK economy has been less marked than many expected. Perhaps the most notable effect so far has been the decline in the value of sterling. This may encourage inward M&A, making British companies more attractive to overseas buyers.

In the longer term, the UK’s future trading relationship with Europe remains uncertain. Businesses exporting to the EU (and to other countries with which the EU has trade deals) will be concerned that their exports may face tariffs if the UK ceases to be part of the customs union. An end to freedom of movement between the UK and EU will also affect companies used to employing European workers.

We do not expect the decision to leave the EU to result in major changes to corporate law, especially as it affects private companies. However, there will be consequences in some areas.

Merger clearance for companies with a European presence is likely to become more complex if the EU’s competition regime ceases to apply to the UK.

The tax affairs of international groups may be affected if the EU regime on intra-group payments, including interest and royalties, is no longer applicable. On the other hand, once the UK is no longer subject to EU state aid rules, the conditions for tax reliefs such as the enterprise investment scheme may be relaxed.

Multinational corporations using the UK as a gateway to the EU may consider setting up a subsidiary in another EU country to ensure continued access to the European market. British firms may seek to do the same, for example in the financial services sector, if the passporting regime ceases to apply to the UK. 

Read the following articles

Brexit, prerogative powers and parliamentary sovereignty: the Supreme Court’s judgment

The Supreme Court gave its judgment in R (on the application of Miller and another) the Secretary of State for Exiting the European Union on 24 January 2017.

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Brexit and Immigration Control - What does this mean for EU nationals?

Yesterday, Tuesday 17 January, the Prime Minister, Theresa May, gave a speech on Brexit setting out 12 objectives she will pursue in her negotiations to leave the EU.

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UK must leave the single market

On 23 June 2016, the UK voted to leave the European Union and since then the country has seen considerable change. With the appointment of Theresa May as Prime Minister, she has had a difficult and challenging task to reinforce the UK's decision to leave the EU.

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Will the European Investment Fund continue to support British start-ups post-Brexit?

It was reported by London & Partners earlier in the year that $3.6bn of venture capital funding was invested in the UK technology businesses in 2015 alone, a substantial increase on previous years. Will industry momentum be subdued by Brexit?

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Possible consequences of the vote to leave

The British people voted to leave the European Union on 23 June 2016. While the result of the referendum is clear, its consequences are uncertain. This article outlines some possible outcomes of the vote to leave.

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What impact will Brexit have on the UK equity fundraising scene?

It was reported by London & Partners earlier in the year that $3.6bn of venture capital funding was invested in the UK technology businesses in 2015 alone, a substantial increase on previous years. Will industry momentum be subdued by Brexit?

Read more

Click here to read more Brexit articles.

 

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