The majority vote in the UK referendum on membership of the European Union, announced on 24 June 2016, in favor of departure by the United Kingdom from the European Union, means that businesses operating in the United Kingdom now face a period of uncertainty. Full details of the timing, process and eventual outcome of negotiations for its withdrawal will only emerge over time.
It is too early to predict the outcome of the negotiations, which will affect the terms on which UK businesses gain access to EU markets and other markets around the world, the legal regime within which they operate in the United Kingdom, and the terms on which non-UK businesses deliver goods and services into the United Kingdom. The range of potential outcomes is broad, and negotiating the precise terms of any future relationship between the United Kingdom and the European Union will be a complex and drawn-out process.
The UK legal system incorporates a vast body of EU law. Disentangling EU and domestic UK laws, to the extent required by the eventual terms of withdrawal, will be an enormous task, and the practical and legal implications will vary in each area of economic activity. There are major and unresolved constitutional issues concerning the relationships between different parts of the United Kingdom, and their future relationships with the European Union, which will have an important bearing on this.
As this process unfolds, companies will need to take account of likely developments in planning their future business activities. While there will in general be no need for immediate, knee-jerk responses, companies should monitor developments closely, and it will in many cases be prudent to carry out a careful assessment of the risks, potential impact and possible opportunities that will arise from the changes in the United Kingdom's relationships with the European Union and with other countries as the outlook becomes clearer over time.
Over the coming weeks and months Mayer Brown will provide legal updates, analysis and our view on what this decision may mean for the UK. If you have questions related to Brexit, please contact a member of the dedicated Mayer Brown Brexit team or your usual Mayer Brown contact.