United States: Our Top Ten Tips On Following The Brexit Process

Last Updated: April 6 2017
Article by Paul T. Friedman and Alistair Maughan

Authored by  By Sir Paul Jenkins*, Paul Friedman and Alistair Maughan

Nine months after the UK voted to leave the EU, the formal exit process has finally started. Within two years, the UK will be out of the EU either on agreed terms or cast adrift with no deal.

The negotiating rhetoric and posturing on both sides will be one confusing aspect of the next two years. UK Ministers have said they will not provide a running commentary on the negotiations, but, with 27 countries plus the European Parliament and Commission also involved and increasingly committed to transparency, there will be a lot of information and misinformation out there. This, plus the high levels of uncertainty until the very end of the process, will make it a difficult environment to take the best business decisions.

Over the next two years, informed insights will be at a premium, and that's what we aim to offer you. What lies behind the headlines? What are the critical moments? What are the questions you should be asking? What should be your planning assumptions?

1. Article 50 is old news

Commentators have focused on A50 because that's the mechanism to leave, and without an A50 deal, the UK is tipped unceremoniously out. But suddenly even the politicians seem to have woken up to the limits of any A50 deal. In the words of A50, the target deal sets out 'the arrangements for withdrawal, taking account of the framework for the future relationship with the EU'. Think of a divorce. This is the first part - agreeing the money, dividing the assets plus some high-level principles about the welfare of the kids. Important for sure, but the detailed arrangements for the children over the years to come are not covered. If there's an A50 deal, it'll be about funding pension liabilities of Brussels bureaucrats and infrastructure projects already agreed but not yet paid for, and it will say fine things about the future. But the detailed future relationship between the UK and the remaining 27 EU member states ('Remaining 27') – who gets the kids on which weekend, which schools they go to – is for Article 218.

2. Article 218 is the new Article 50

A218 is the Lisbon Treaty provision covering deals between the EU and third countries: as it leaves, the UK becomes a third country as far as the EU is concerned. For companies currently trading in the UK and the rest of the EU, this is where the future rules will be settled. Any future trade deal, whether for goods, services or both, between the EU and the UK will be done under A218, and so too any agreement on the movement of people and capital. Unlike A50, A218 sometimes requires unanimity amongst the Remaining 27 and may also require ratification by EU national (and in some cases regional) governments.

3. Signs of sequencing

Sequencing will be critical for businesses. Even with a deal, the worst case scenario is an A50 divorce settlement followed by a UK/EU trade agreement, followed by UK/third-country trade deals. Best case scenario is probably a simultaneous A50 deal and transitional UK/EU trade agreement that includes transitional retention of rights under EU/third-country arrangements. Nobody seriously expects full UK/third-country trade deals until much later. The Remaining 27 have been clear that some or all of this may be on the table. But, going back to the divorce analogy, they want the money sorted out first, and they share the UK's wish for early resolution of the status of EU and UK residents in each other's countries after the divorce. So, watch out for movement on money and residents. Progress on these issues will see the Remaining 27 more ready to start A218 talks in tandem with A50: they are the keys to unlock helpful sequencing for business.

4. Signs of substance

Progress on money and the rights of UK/EU residents may be the first signs of movement. But, for businesses investing in the EU and the UK, progress on the basis of future trading between the two will be the more important signs of progress. One of the things we are pretty clear about is that the UK will not have current levels of access to the Single Market, nor, probably, to the Customs Union, which is critical for businesses with cross-border supply chains in Europe. There is likely to be softer language on movement of goods. Softer language on services will be harder to detect and progress harder to achieve. Much commentary has been about financial services, but legal services, for example, give rise to difficult issues not only of free movement but also continued mutual recognition of qualifications and rights to practice.

5. Transition is the key to a sensible Brexit

Whatever UK ministers may say, nobody seriously believes that the A50 deal – and detailed, long-term EU/UK arrangements – can be finalised in two years: there's too much, and it's just too complex. Transitional arrangements covering maybe the three to five years from 2019 are realistically the only way to provide a stable business environment until the final UK/EU and UK/third-country relationships are settled. Watch out for the first signs of the UK gently rowing back from its insistence that the European Court of Justice must be completely out of the picture by 2019 or that we'll pay our historic debts but nothing for the future. The continuing role of the Court and future contributions are critical to the possibility of a transitional agreement.

6. UK/third-country agreements are critical

Many critical UK relationships with non-EU countries are governed by EU/third-country agreements. When the UK leaves the EU, it will cease to be a party to those agreements. Replacements will be needed, and they won't come quickly. The hope is that sensible transitional arrangements will prevent a void opening up at the end of two years, for example, by rolling forward the 2007 EU-US Open Skies Agreement so the planes keep flying. But, whether dealt with initially in transitional arrangements or in the longer term, watch out for the UK rushing into third-country deals too quickly. That will be the political temptation, but it will expose the UK's vulnerable negotiating position. Depending on your business model, a bad deal for the UK may be a good one for you.

7. It's not over 'til it's over

There's much talk of sectoral settlements, of ticking off issues one by one over the next two years. This may happen, and, if it does, there will be much trumpeting, especially by UK ministers. But, in terms of business planning, remember that nothing is finally settled until the whole exit package is settled. EU negotiations are notorious for going right up to the wire and beyond – stopping the clocks at 23.59 on deadline day. Last-minute rows about Gibraltar and Polish workers' rights could scupper the whole thing.

8. Timing is important

A50 gives two years (unless everyone agrees longer which is unlikely), so is 23.59 on 29 March 2019 the moment all is done or all is lost? Probably not. The European Parliament has to approve the final deal. The UK Parliament has been promised a vote before it goes to the EP. Current best thinking is all this will need six months. And what if the EP or the UK Parliament object? Will part of those six months be needed for more negotiations? There's nothing to watch out for here at the moment; in a year, we'll be looking for signs.

9. No deal is a real possibility

UK Ministers are fooling few people when they assert that no deal would be 'perfectly ok'. In our earlier piece on the impact of President Trump's election, we highlighted the profound implications for the UK, and for those who do business here, if there is no deal. Business decisions over the next two years will be heavily risk-focused. We are already hearing about contingency plans for movement out of the UK in the banking and insurance sectors – not entire operations but enough for a sound base within the Remaining 27. This planning guards against specific sectoral problems but also recognizes the real risk of no deal. Understanding this risk is critical for business planning. Again, there are few signs at the moment either way; we'll need a closer look in 12 months or so.

10. Bureaucrats don't know best

This is hardly a controversial view even for a former bureaucrat, but the final point to bear in mind right now is that bureaucrats are doing the negotiating, and they need to understand sectoral issues and concerns. So make your views known. Discreet sectoral lobbying will be vital in London, Brussels and EU capitals where you operate. Use your governments. The Japanese Government/business Brexit analysis last year was far better than anything the UK Government or the Remaining 27 produced. Make sure that your sector's views are known.

Read our Brexit Fact Sheet: What You Need To Know About Triggering Article 50 for more information.

*About Sir Paul Jenkins:

From 2006 to 2014, Sir Paul Jenkins QC was the United Kingdom Government's most senior legal official, advising the governments of Prime Ministers Blair, Brown and Cameron. He is an acute observer of Brexit developments. Sir Paul Jenkins currently practices at Matrix Chambers.

Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

© Morrison & Foerster LLP. All rights reserved

To print this article, all you need is to be registered on Mondaq.com.

Click to Login as an existing user or Register so you can print this article.

Paul T. Friedman
Alistair Maughan
In association with
Related Video
Up-coming Events Search
Font Size:
Mondaq on Twitter
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
Email Address
Company Name
Confirm Password
Mondaq Topics -- Select your Interests
 Law Performance
 Law Practice
 Media & IT
 Real Estate
 Wealth Mgt
Asia Pacific
European Union
Latin America
Middle East
United States
Worldwide Updates
Check to state you have read and
agree to our Terms and Conditions

Terms & Conditions and Privacy Statement

Mondaq.com (the Website) is owned and managed by Mondaq Ltd and as a user you are granted a non-exclusive, revocable license to access the Website under its terms and conditions of use. Your use of the Website constitutes your agreement to the following terms and conditions of use. Mondaq Ltd may terminate your use of the Website if you are in breach of these terms and conditions or if Mondaq Ltd decides to terminate your license of use for whatever reason.

Use of www.mondaq.com

You may use the Website but are required to register as a user if you wish to read the full text of the content and articles available (the Content). You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these terms & conditions or with the prior written consent of Mondaq Ltd. You may not use electronic or other means to extract details or information about Mondaq.com’s content, users or contributors in order to offer them any services or products which compete directly or indirectly with Mondaq Ltd’s services and products.


Mondaq Ltd and/or its respective suppliers make no representations about the suitability of the information contained in the documents and related graphics published on this server for any purpose. All such documents and related graphics are provided "as is" without warranty of any kind. Mondaq Ltd and/or its respective suppliers hereby disclaim all warranties and conditions with regard to this information, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. In no event shall Mondaq Ltd and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use or performance of information available from this server.

The documents and related graphics published on this server could include technical inaccuracies or typographical errors. Changes are periodically added to the information herein. Mondaq Ltd and/or its respective suppliers may make improvements and/or changes in the product(s) and/or the program(s) described herein at any time.


Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:

  • To allow you to personalize the Mondaq websites you are visiting.
  • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our information providers who provide information free for your use.

Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.

If you do not want us to provide your name and email address you may opt out by clicking here .

If you do not wish to receive any future announcements of products and services offered by Mondaq by clicking here .

Information Collection and Use

We require site users to register with Mondaq (and its affiliate sites) to view the free information on the site. We also collect information from our users at several different points on the websites: this is so that we can customise the sites according to individual usage, provide 'session-aware' functionality, and ensure that content is acquired and developed appropriately. This gives us an overall picture of our user profiles, which in turn shows to our Editorial Contributors the type of person they are reaching by posting articles on Mondaq (and its affiliate sites) – meaning more free content for registered users.

We are only able to provide the material on the Mondaq (and its affiliate sites) site free to site visitors because we can pass on information about the pages that users are viewing and the personal information users provide to us (e.g. email addresses) to reputable contributing firms such as law firms who author those pages. We do not sell or rent information to anyone else other than the authors of those pages, who may change from time to time. Should you wish us not to disclose your details to any of these parties, please tick the box above or tick the box marked "Opt out of Registration Information Disclosure" on the Your Profile page. We and our author organisations may only contact you via email or other means if you allow us to do so. Users can opt out of contact when they register on the site, or send an email to unsubscribe@mondaq.com with “no disclosure” in the subject heading

Mondaq News Alerts

In order to receive Mondaq News Alerts, users have to complete a separate registration form. This is a personalised service where users choose regions and topics of interest and we send it only to those users who have requested it. Users can stop receiving these Alerts by going to the Mondaq News Alerts page and deselecting all interest areas. In the same way users can amend their personal preferences to add or remove subject areas.


A cookie is a small text file written to a user’s hard drive that contains an identifying user number. The cookies do not contain any personal information about users. We use the cookie so users do not have to log in every time they use the service and the cookie will automatically expire if you do not visit the Mondaq website (or its affiliate sites) for 12 months. We also use the cookie to personalise a user's experience of the site (for example to show information specific to a user's region). As the Mondaq sites are fully personalised and cookies are essential to its core technology the site will function unpredictably with browsers that do not support cookies - or where cookies are disabled (in these circumstances we advise you to attempt to locate the information you require elsewhere on the web). However if you are concerned about the presence of a Mondaq cookie on your machine you can also choose to expire the cookie immediately (remove it) by selecting the 'Log Off' menu option as the last thing you do when you use the site.

Some of our business partners may use cookies on our site (for example, advertisers). However, we have no access to or control over these cookies and we are not aware of any at present that do so.

Log Files

We use IP addresses to analyse trends, administer the site, track movement, and gather broad demographic information for aggregate use. IP addresses are not linked to personally identifiable information.


This web site contains links to other sites. Please be aware that Mondaq (or its affiliate sites) are not responsible for the privacy practices of such other sites. We encourage our users to be aware when they leave our site and to read the privacy statements of these third party sites. This privacy statement applies solely to information collected by this Web site.

Surveys & Contests

From time-to-time our site requests information from users via surveys or contests. Participation in these surveys or contests is completely voluntary and the user therefore has a choice whether or not to disclose any information requested. Information requested may include contact information (such as name and delivery address), and demographic information (such as postcode, age level). Contact information will be used to notify the winners and award prizes. Survey information will be used for purposes of monitoring or improving the functionality of the site.


If a user elects to use our referral service for informing a friend about our site, we ask them for the friend’s name and email address. Mondaq stores this information and may contact the friend to invite them to register with Mondaq, but they will not be contacted more than once. The friend may contact Mondaq to request the removal of this information from our database.


This website takes every reasonable precaution to protect our users’ information. When users submit sensitive information via the website, your information is protected using firewalls and other security technology. If you have any questions about the security at our website, you can send an email to webmaster@mondaq.com.

Correcting/Updating Personal Information

If a user’s personally identifiable information changes (such as postcode), or if a user no longer desires our service, we will endeavour to provide a way to correct, update or remove that user’s personal data provided to us. This can usually be done at the “Your Profile” page or by sending an email to EditorialAdvisor@mondaq.com.

Notification of Changes

If we decide to change our Terms & Conditions or Privacy Policy, we will post those changes on our site so our users are always aware of what information we collect, how we use it, and under what circumstances, if any, we disclose it. If at any point we decide to use personally identifiable information in a manner different from that stated at the time it was collected, we will notify users by way of an email. Users will have a choice as to whether or not we use their information in this different manner. We will use information in accordance with the privacy policy under which the information was collected.

How to contact Mondaq

You can contact us with comments or queries at enquiries@mondaq.com.

If for some reason you believe Mondaq Ltd. has not adhered to these principles, please notify us by e-mail at problems@mondaq.com and we will use commercially reasonable efforts to determine and correct the problem promptly.