13 February 2014
- A report published by leading global law firm Mayer Brown, today calls for businesses to consider the both the legislative burden and the opportunities of an UK EU exit. With everything from employment laws to requirements for energy efficient buildings and tax planning to the financial supervision of global banks governed by EU regulation, Mayer Brown's report explores how EU law impacts those conducting business in or with the UK.
Employment law is an example of an area that is hugely governed by the EU, offering minimum standards and a level playing field between businesses across the EU. However, having established a business environment that encourages fairer competition, the report questions whether a UK EU exit would free businesses from red tape around areas such as the collective redundancy rules or make it more challenging for them to manage operations across Europe.
Alexandria Carr, of counsel in the Financial Services Regulatory and Enforcement group at Mayer Brown, said: "It is vital to consider the likely future direction of travel in the EU. The ongoing global financial crisis alongside the downturn in EU competitiveness and voter dissatisfaction could bring things to a head in the EU as a whole, not just the UK. Current developments to tackle the sovereign debt crisis in the Eurozone seem to recognise that the one size fits all model is no longer viable but this creates its own problems, notably the potential creation of a multi-speed Europe with the UK on the slower track. We must consider what this would mean for the EU and the UK and how to deal with such future developments."
In addition to looking at the benefits and challenges of EU legislation, the Mayer Brown report raises questions about the UK relationship with the EU and the impact of an exit. It also calls for businesses to have their say at a time when the UK Government is entering the last phases of a two-year review of the impact of EU membership on the UK.
Sandy Bhogal, Head of Tax in London, said: "Our report aims to demystify the important debate surrounding the EU and the Financial Transactions Tax is a good example of an issue that has been steeped in controversy. Whilst the UK is not one of the Member States that has signed up to it, the FTT could still be imposed on British businesses, which would seriously inhibit financial transactions in the UK and threaten London’s position as a leading financial centre if businesses decide to shun the EU together. So you could argue that it would be better for the UK to stay in the EU to at least have a voice in shaping tax policies."
Mark Prinsley, Head of Intellectual Property in London, said: "There are pros and cons to staying in the EU. Exit might mean the end the exhaustion of rights rules and enable UK national IP rights owners to exclude goods marketed elsewhere in the EU from the UK market and protect their UK market margins. However, an exit would inevitably mean loss of the influence we have as part of a large trading block in the international debates about the shape of intellectual property protection globally in areas such as patent protection for software and the impact on IP rights of E commerce."
To access the full report, ‘What does Europe do for the UK? And what does the UK do for Europe?’ click here