Well article 50 has been effectively triggered today. Since the referendum there has been a period of uncertainty, but the latest analysis of possible effects on businesses and the probable changes to the law can be better understood.
One of the major issues that will need to be addressed will be all the EU registered trademarks, designs and the protected food and drink designations. Currently we have a national system which closely mirrors the EU regime, but after Brexit, the EU Trade Mark and the Community Registered Design legislation will no longer apply in the UK. Also protected names such as “Stilton” cheese will no longer apply to UK products so we may see in the future, French “Stiltons” or “Melton Mowbray Pies” and UK “Champagnes” and “Parma hams”.
Although the government has stated it will transpose much of EU law into UK law (The Great Repeal Act), this is not a simple as it sounds, there are many, many, alterations needed for the Laws to continue to make sense in the UK only and it remains unclear what will happen to current EU Trade Marks and Community Registered Designs. In any event, it’s possible that the UK Intellectual Property Office could be inundated with new and renewed registrations.
Data protection is another area of concern; currently the UK is committed to implementing the General Data Protection Regulation, but this may not be enough to prevent future problems with the EU as there may be legal challenges within the EU to recognise non-EU country’s data laws. On possible solution would be to have individuals either specifically give their informed consent to transfer their data or add clauses to contract that may involve data transfer.
Regulated industries are also likely to be affected; currently London houses the headquarters of the EU pharmaceuticals and veterinary products regulator, the European Medicines Agency, but this must change post Brexit which might mean delays to the clinical testing or marketing of new products in the UK. This might also apply in other heavily regulated sectors like the motor and aviation industries.
Businesses will encounter difficulties in many areas planning for the future with the legal outlook so uncertain. Although this brief overview doesn’t cover the thorny subjects of immigration restrictions and trade barriers, business needs certainty, which will only happen as the negotiations begin in earnest and the Government’s approach to tidying up the legal mess that Brexit involves becomes clearer.
What is certain is that if you are planning to enter into, or have existing long term agreements with partners in the EU you may need to consider the implications for those agreements. Some changes can sensibly be made now to deal with a post-Brexit world, so why not give us a call.
One legal issue that rarely gets mentioned is what happens if a company decides to re-locate. Many contracts of employment include mobility clauses which effectively force employees to move, leave or face dismissal. While these clauses are perfectly legal, should an employee choose to leave as a result of the move it may not just be a simple case of dismissal or dealing with a resignation, and if an employee flatly refuses to move, you may have to acknowledge they’re redundant and pay redundancy or you may find yourself at the wrong end of an unfair dismissal claim.
In a recent case, a company decided to close one of their two sites and move the workforce to the remaining site. The company did make arrangements to make redundancy payments for “exceptional circumstances” to some staff who were elderly or had specific problems which made the move impossible, but during this process, two employees were told to move under their mobility clauses and when they refused to relocate, were dismissed.
The Employment Appeal Tribunal heard that although there was a redundancy situation, the actual reason given for dismissal was “misconduct”; but since the company thought that it could rely on mobility clauses to avoid paying out redundancy payments the Employment Appeal Tribunal found that the actual reason for the dismissals was the employees’ refusal to relocate. The Employment Appeal Tribunal also found that the instruction to relocate to offices on the other side of London to be unreasonable, even with the mobility clauses, so that made the decision to dismiss unfair.
Although these types of cases are always adjudged based on the specific circumstances involved, it pays to consider the company’s options. They demanded that their employees relocate without considering the possible legal ramifications, and had they acknowledged their positions would have been redundant and they could probably have been made redundant fairly which would have resulted in redundancy payments far less than the cost of the legal action and subsequent compensation paid. So if you are planning to relocate or downsize, why not give us a call.
The law is forever being changed and amended so it often helps to know what’s likely to happen in the year ahead so as a business you can make plans and contingencies. Here are a few “red letter dates” for your diary:
In March, the big thing is the triggering of Article 50 triggering “Brexit,” once this happens we will enter uncertain times so if you’ve not done so already now’s the time to consider the possible effects on your business. 1st April will bring business rates revaluation in England, Wales and Scotland, along with a new appeals procedure. If you think you may be affected, now’s the time to contact your legal advisors. April will also see a complete overhaul of the current rules regarding insolvency rules which will serve to update and modernise those from 1986. From April, for anyone buying a new car, only zero emission cars will be exempt from road tax; all other vehicles will be charged higher tax prices in the first year of registration based on their CO2 emissions and then, a flat rate of £140 will be charged on most cars after the first year, unless they costing more than £40,000, these will be subject to a higher rate.
Going further forward during spring, we can expect new rules to be introduced to make individual directors personally liability for nuisance calls fines as a result of “direct marketing calls”. In June, mobile phone roaming charges are likely to be abolished according to plans announced by the European Commission. Mobile users will then pay the same prices when travelling in the EU as they do at home. Also new money laundering rules should come into force and will apply to mostly financial institutions, but SME’s can expect changes to the “persons with significant control (PSC)” register regime for company owners.
Autumn will bring the introduction of the Small Business Commissioner scheme which will, amongst other thing, support small businesses in resolving most payment disputes with larger businesses. The scheme will also offer general advice and information to SME’s on dispute resolution and basic principles of contract law.
As always, if you want to discuss any of these legal issues, give us a call.
The results of a recent case which is the first such conviction under the new laws have led the Competition and Markets Authority to issue new rules and guidelines for company directors. A director of an online company agreed not to act as a director of any UK company for 5 years after his company was found to have been part of an online price-fixing cartel.
This case highlights the fact that company directors have a responsibility to be well-informed about their company practices and to ensure these practices comply with the law. It’s worth knowing that if caught breaking competition law, directors can be disqualified from acting as a director of a company or carrying out other specified roles in relation to a company for up to 15 years.
What this case highlighted was that knowing about illegal practices without taking steps to stop them could be grounds for disqualifying a director and if a company breaks competition law and the director wasn’t diligent and should have known, this is also a possible ground for disqualification.
As a director therefore it is vital that you keep abreast of your company’s affairs so you can spot and stop any illegal practices as soon as possible, if you suspect illegal business practices you should investigate and take immediate steps to stop them. If in doubt, get independent legal advice. Familiarise yourself with competition law risks and make sure this information is cascaded down through all levels of management.
It pays to routinely ask yourself, what are our present competition law compliance risks? What are the high, medium and low risks and what are we doing to mitigate these risks? When are we next reviewing the effectiveness of these measures? It helps to designate a trustworthy person in your company for staff to report concerns to.
As always, if you are concerned about any aspect of competition law, why not give us a call?
Although the General Data Protection Regulation comes into force on 25 May 2018, businesses should really look at their processes and procedures now, because the GDPR will create a major shift in how all organisations handle personal data.
At the moment, employers can justify processing employee data on the basis of consent in the contract of employment. The GDPR will set out more strict conditions regarding consent;
- it must be freely given
- informed and unambiguous
In future, the onus will be on the employer to show that the employee gave adequate consent which will require at the very least a review of the existing wording of employment contracts.
Any loss of personal data, whether by accident or by hacking will have to be notified to the data protection authority promptly along with the individuals themselves if the breach poses a significant risk to their rights and freedoms. Businesses should ensure they have a data breach response plan in place and train their employees accordingly.
The company data protection policy will also need to be reviewed in good time; all that’s needed at the moment is a privacy notice or “fair processing notice” that sets out the purposes for which data is processed. In future employers will have to provide more information such as:
- how long the data will be stored for
- if that data will be transferred to other countries
- information on the right to make a subject access request
- the right to have personal data deleted or rectified
The most significant change however will be that employees will have increased rights to object to certain processing, to have data corrected or restrict how data is used, and to be forgotten by having their data deleted. These rights could become an additional tool in employment disputes. In the right circumstances, an employee could use these rights to cause difficulties with an on-going disciplinary process.
Ultimately the best course of action is to get good legal advice and to ensure documentary records are in place and there are clear lines of responsibility. As always if you need help or advice on this topic, give us a call.
Another obvious aspect of commercial property law that’s widely neglected is that of access rights. Developers, of course, tend to be well aware that access rights are fundamental to freeing up landlocked development sites and securing a suitable route of access to the site is critical.
Unfortunately, assumptions are often made regarding access routes during negotiations without undertaking essential due diligence, which often leads to problems further down the line, which then requires renegotiation, with delays and inevitably increased costs or at worst, a failed project.
Complications often arise when dealing with Rights of Way (a form of easement) which are governed by rules established in case law. This body of case law contains many rules of interpretation, which often allow landowners to challenge the proposed use and this can delay funding until the matter is settled. Issues such as if the land that benefits from the easement does not cover the whole development site, or if there is ambiguity as to the scope or purpose of the easement, are just some of the potential challenges that could cause problems.
Unless a right of way is expressed to be “at all times and for all purposes”, then problems can arise regarding the past usage of the route or original intent of the grantor; basically just identifying the access route and its owner may not be enough; it’s important to evaluate a route after investigating title and having raised all the relevant enquiries. If a new right of way is to be granted, it is important that the landowner must be capable of granting the right of way and the relevant parcels of land must be clearly defined.
Finally, never forget to carry out searches, especially local authority and utilities. If an access route is affected by public rights such as footpaths or bridleways, or if it crosses existing utility pipes or cables, you may have to divert the route, but identifying such issues early will help decide whether that route is viable and what the likely cost impact will be. A solicitor is invaluable to carry out these searches and investigations and give you sound advice on the form of deed of easement, that’s best for you, so if you are planning to develop a site, why not give us a call?
Thinking of buying a business? There may be more to consider nowadays than you might think; due diligence is vital when it comes to deciding whether or not to go ahead with an acquisition, it helps a the potential buyer to decide if the price is right or fair, or if there is any specific risk that can be identified which can be covered by specific indemnity clauses in the sale and purchase agreement and even whether to proceed or not, as previously stated.
Matters are further complicated now because of the uncertainty surrounding Brexit. Buyers must now consider expanding their due diligence activity to include Brexit-related issues such as European-registered intellectual property, foreign employees and contracts with third parties based in the EU.
Just looking at intellectual property that may be European-registered, will the buyer need to obtain a specific UK registration? It may be necessary to renegotiate Intellectual property licences where the territory of the licence is linked to the EU or even the European Economic Area so that all relevant parts of the UK are still included.
Company acquisitions are more complex than ever so you need a good legal team behind you at all times, why not give us a call?