No deal contingency

In the run up to Britain’s scheduled March 29 exit date the Irish Government published its no deal Brexit contingency legislation, the Withdrawal of the United Kingdom from the European Union (Consequential Provisions) Bill 2019.

While the outcome of Brexit remains uncertain, it now appears likely the UK will pursue an extension to Article 50 to avoid a cliff-edge exit on 29 March. However, even if the UK are granted an extension, the threat of a no deal scenario will remain until a withdrawal agreement and a further future trading arrangement can be agreed.

In the meantime, Ireland has established its plan if a hard Brexit were to occur. Although the Government has stated its hopes to never have to utilise the Bill, the 15 pieces of legislation across nine government departments was described by Tánaiste and Minister for Foreign Affairs and Trade Simon Coveney as “the product of a root-and-branch trawl of our laws to determine what changes will be needed if the UK becomes a third country overnight”.

Interestingly, the Bill, which is to be given priority in the Dáil, omits any contingency plans on cross-border trade and criticism has been levelled at the short time frame allocated to processing and scrutinising such a substantial piece of work.

The Bill, if enacted, will allow for legislative provisions to enable Common Travel Area healthcare arrangements, such as reimbursements, to be maintained between Ireland and the UK. It will also allow the Commission for Regulation of Utilities (CRU) to modify licenses of Irish-based participants in the wholesale electricity market on a temporary basis to ensure that any issues of non-compliance with EU law can be addressed.

Enterprise Ireland is to be given extra powers to further support businesses and there are arrangements to ensure that Irish students studying in the UK and UK nationals studying in Ireland, who currently qualify for SUSI grants because of the UK’s membership of the EU, will continue to do so. The Bill applies to eligible Irish students studying in the UK, as well as UK students in Irish higher education institutions.

The largest section of the Bill contains policy on taxation and provides for modification of income tax, capital tax, corporation tax and stamp duty legislation.

In regards to financial services, there are legislative amendments to support the implementation of the European Commission’s equivalence decision under the Central Securities Depositories (CSD) Regulation and to extend to Irish participants in the UK protections contained in the Settlement Finality Directive.

Amendment to European Union (Insurance and Reinsurance) Regulations 2015 and the European Union (Insurance Distribution) Regulations 2018, regarding financial services, provides for a temporary run-off regime, which, subject to a number of conditions, will enable UK insurance undertakings and intermediaries to continue to fulfil contractual obligations to their Irish customers for a period of three years after the date of the withdrawal of the UK from the EU.

At ports, there will be an extension of pilot exemption certificates issued by harbour companies from the existing maximum one year to three years and existing holders can apply for new certificates up to 29 March. A regulatory regime is also being established for bus and coach services across the border (and into the wider UK).

Mimicking the legislation changes Ireland had agreed with the UK to be included in the withdrawal agreement, the Bill provides for the continuation of current social security arrangements post-Brexit.

Workers will also be offered protections in that in the case of an employer becoming insolvent under the laws of the UK (no longer the scope of the Protection of Employees (Employers’ Insolvency) Act in a no deal scenario) will continue to be covered by the protections set out in the Act.

Lastly, immigration officers are to be given the power to undertake refoulment consideration when considering removing or deporting a person from the State.

The Bill, which has cross-party support, will now be scrutinised in the Seanad after passing through the Dáil.

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