Voters in the United Kingdom (UK) have voted in favor of the UK leaving the European Union (EU). By a margin of 52% to 48%, voters supported the referendum known as “Brexit". In response to the results, UK Prime Minister David Cameron has stated he will resign by October. Cameron had called for the referendum and strongly advocated for the UK to stay in the EU.
There is still much uncertainty about the impact of the decision of UK voters to leave the EU. The biggest impact is likely to be the end of free movement of labor between the UK and the EU. This would clearly have a significant impact on mobility management in the region. The UK withdrawal from the EU will formally occur within the next two years.
While there is no clear blueprint for what will follow the exit of the UK from the EU, the next steps in the process are known and are as follows:
- The UK Government will request the EU to start the "Article 50 process" - the process which exists for the exit of a member state, but never previously used. The UK will enter detailed negotiations about both past and future arrangements. Agreement will need to be concluded on how to "unwind" previous rights and obligations, with decisions taken on how the UK and the EU would interact in the future. These negotiations will need to fit within a 2 year time period, unless the remaining 27 EU states agreed to give the UK an extension.
- Following the conclusion of exit negotiations, including future UK/EU trade arrangements, the next step will be for the UK to enter into separate trade negotiations with non-EU countries.
The legal consequences of Brexit could be considerable. Subject to the terms of the new trading agreements, all EU treaties, regulations and decisions of the European Court of Justice cease to apply to the UK unless specifically preserved by UK law.
Agreeing to a new relationship with the EU could be problematic. The UK will likely wish to avoid the imposition of "free movement of labor" obligations which the EU has in place in their trade agreements with countries such as Norway and Switzerland. "Leave" campaigners believe that the UK will be able to negotiate an EU trade deal which will allow the UK to limit immigration from the EU to skilled immigrants only, in line with UK immigration rules for non-EU citizens.
Worldwide ERC® will keep you posted of new developments that the Brexit will have on the mobility industry.