Preparations for UK withdrawal and contingency planning for a 'no-deal' scenario

Updated

The United Kingdom’s withdrawal from the European Union will involve change and it is necessary for all concerned to prepare for this. The process of negotiation ended on 25 November when the European Council backed the negotiated Withdrawal Agreement and a political declaration on the future relationship. Approval processes are now under way in the UK parliament and in the European Parliament.

The main scenario is an orderly withdrawal based on the negotiated agreement, which includes provisions on a transition period which will run until the end of 2020 at least. However, in view of the ongoing approval process, there is a clear risk of a withdrawal without an agreement, which is why contingency planning to handle such an eventuality needs to be in place.

The Swedish Government is assessing developments continuously and will in its communications with Swedish citizens and all actors in society provide the information that can be provided. 

For those citizens who are particularly affected, namely Swedish and other EU citizens living in the UK and UK citizens living in Sweden and other EU Member States, information and links are available here:

What does Brexit mean for citizens who are particularly affected?

Preparations for Brexit

Preparing for the UK’s withdrawal is an important part of the Government’s Brexit work. Extensive preparatory work is under way at the Government Offices and government agencies to determine which measures will be necessary to take as a result of the UK becoming a ‘third country’ in relation to the EU on 30 March 2019 and to prepare for these. This includes reviewing which regulations and systems must be amended when the UK leaves. 

The Government is also conducting contingency planning to address the serious consequences that would arise if the UK were to leave the EU without a withdrawal agreement. This concerns identifying, planning and carrying out the measures required to deal with the effects of such a scenario. The purpose of these measures is to handle serious consequences during a limited period. It is therefore not a question of dealing with all of the consequences or replacing a withdrawal agreement. One clear part of the Government Offices’ contingency planning is handling the particularly affected citizens – UK citizens living in Sweden and Swedish and other EU citizens living in the UK. Other areas that are part of the contingency planning – and which will require measures should a withdrawal without an agreement become a reality – include aviation, customs, sanitation and phytosanitation, and financial services.    

In the preparatory efforts and contingency planning, the Government and the Government Offices are engaging in continuous dialogue with government agencies as well as central business sector and societal stakeholders. These efforts will be intensified during the remaining period until the UK withdrawal.

Regulatory amendments to handle the possibility of a no-deal withdrawal

Some contingency action involves revising Swedish regulations. See the links below for further information on the legislative amendments currently being drafted.

Press release: Social protection following Brexit (25 February 2019)

Article: Transitional solution for continued access to investment services following Brexit (7 February 2019)

Report: Proposals aiming to offer EU citizens continued entitlement to social security benefits after Brexit (1 February 2019) 

Referral for consultation: Proposal to amend the Vehicle Ordinance to comply with the need to be able to appoint more actors for testing and inspections in type approval procedures for vehicles as a result of Brexit (30 January 2019)

Article: Measures that facilitate for UK citizens in Sweden – time-limited regulation on an exemption from the requirement to hold residence and work permits for those UK citizens and their family members who lose their right to live and work in Sweden as a result of a no-deal Brexit (15 January 2019)

Press release: Transitional solution for continued access to investment services following Brexit (28 November 2018)

Prop. 2018/19:3 (in Swedish only) Continued access to international settlement systems – adjustment of the Swedish implementation of the Settlement Finality Directive as a consequence of Brexit (the amendments entered into force on 1 January 2019)

A lot being done by the EU

A considerable share of the preparatory efforts and contingency planning is taking place within the EU. This includes going through the EU acquis (the accumulated body of legislation, legal acts and court decisions) and implementing necessary amendments.

The European Commission has a particularly important role to play by proposing new legislation, providing guidance in relevant areas and coordinating planning and implementation of measures, both with regard to preparations and contingency planning. At the Commission, responsibility lies with the Secretariat-General, which handles the overall coordination of the Commission’s work. 

On its website, the European Commission has provided information on its work to prepare for the withdrawal of the United Kingdom from the European Union. The page includes a list of all the regulatory changes that have been proposed to handle the withdrawal, as well as technical announcements on the legal and practical consequences. 

Brexit prepardness

The Commission has published three communications on its work to prepare for the withdrawal of the United Kingdom (including contingency planning for withdrawal without an agreement).

Communication of 19 December 2018: “Preparing for the withdrawal of the United Kingdom from the European Union on 30 March 2019: Implementing the Commission’s Contingency Action Plan”

Fact sheet (in Swedish) on the implementation of the Commission’s Contingency Action Plan

Communication from the Commission on a Contingency Action Plan, 13 November 2018

Fact sheet (in Swedish) on the Communication from the Commission on a Contingency Action Plan

Communication from the Commission on Preparing for the withdrawal of the United Kingdom from the European Union, 19 July 2017

Fact sheet (in Swedish) on the Communication from the Commission on Preparing for the withdrawal of the United Kingdom from the European Union

But everyone must prepare

All concerned actors need to prepare for Brexit. In addition to the EU, the Member States, the Government and government agencies, this also includes organisations, the business sector and others.

Everyone is urged to keep up-to-date with the latest developments. Particularly affected citizens, i.e. Swedish and other EU citizens living in the UK and UK citizens living in Sweden, can find information here:

What does Brexit mean for citizens who are particularly affected?

Main scenario: Withdrawal Agreement and transition period until 2020

The main scenario is an orderly withdrawal based on the negotiated agreement. This means that the UK will officially become a ‘third country’ when it leaves the EU on 30 March 2019. On that date, the UK will leave the EU’s institutions and decision-making processes, but will be covered by EU law during a transition period. The transition period will provide time for adjustment to the future relationship between the EU and the UK. It involves the UK continuing as if it were still an EU Member State, but without taking part in the EU’s decision-making. The transition arrangement will run from withdrawal on 30 March 2019 until the end of 2020. If the parties agree to it, the period can be extended once, until the end of 2022 at the latest.

The framework of the future relationship has been established in the joint political declaration agreed by the parties. This text is not legally binding, but it will form the basis of future negotiations that will be initiated when the UK has left the EU. It deals with important issues for the future relationship, such as the basis for cooperation, the economic relationship and the security partnership.

Although the political declaration provides guidance on how the future relationship is to be formed, it is currently not possible to provide any precise details. It is the parties’ objective to forge as close a relationship as possible given their negotiating positions. The position of the UK Government is that the UK will leave the EU single market and customs union. Even if the parties have agreed to minimise the consequences of this as far as possible, it must be expected that it will be more complicated for companies in the EU to trade with the UK. Nor will it be as easy as it is today for EU citizens to work and live in the UK.

Scenario 2: no-deal withdrawal on 30 March 2019

It cannot be ruled out that the withdrawal process will be concluded without it having been possible to bring any agreement into force. In this event, the UK will officially become a ‘third country’ in relation to the EU. There will be no transition period and EU law will cease to apply in relation to the UK on 30 March 2019. This scenario means, among other things, that trade with the UK will be regulated on the basis of applicable international principles and rules from, for example, the WTO. The EU will apply third country rules to the UK in relation to, for example, customs controls and checks that EU requirements on goods are met. This may involve delays in transportation. In this scenario, there is no agreement on special arrangements for EU citizens in the UK or UK citizens in the EU.

Government is assessing developments continuously

In view of the uncertainty concerning the future relationship with the UK, it is currently difficult to provide any precise details. The main scenario is an orderly withdrawal and therefore that the transition period, which is part of the Withdrawal Agreement, takes effect on 30 March 2019. However, the risk of a no-deal withdrawal is clear.

The Swedish Government is assessing developments continuously and will in its communications with Swedish citizens and all actors in society provide the information that can be provided.