Brexit will have potentially far-reaching implications for individuals' personal affairs.
Individuals with assets in multiple jurisdictions should consider their investment portfolio and whether any changes would be appropriate. In particular, although domestic tax provisions are unlikely to change immediately after the transition period, UK residents with property in an EU Member State may find themselves subject to the more punitive tax charges that some Member States apply to non-EU residents who hold property there. This may impact tax on gains, income and potentially inheritance. Advice may be required from a number of different jurisdictions to make tax-efficient decisions.
In disputes concerning international trusts with assets, trustees and beneficiaries in multiple jurisdictions, the question of which court has jurisdiction can be the first battle. EU law sets out provisions to govern the jurisdiction of the courts. It remains to be seen what the arrangements for cross-border disputes will be after Brexit and how jurisdiction will be determined where there are connections to a number of European countries.
For individuals with assets in EU Member States trying to plan their succession, or for beneficiaries trying to work out their entitlement to an international estate (or disputing the same), Brexit may actually go some way to clarifying one aspect of the law in this area. The EU Succession Regulation (Brussels IV) provides common conflict of law rules across those EU Member States which signed up to the Regulation as to which law applies to the succession of assets held in those states.
While the UK did not opt into Brussels IV, since the Regulation came into effect the question of whether the UK is deemed a Member State or a third state for the purpose of the Regulation has been the subject of debate, creating an element of uncertainty in estate planning and administration for UK nationals resident in Regulation Member States or with a connection there. Upon exiting the EU, the issue is no longer a matter for debate; the UK will undoubtedly be a third state. That said, for those holding assets in the EU, issues may still arise out of conflicts between Brussels IV and English law. Those affected should seek advice in order to try to avoid uncertainty after their death.
The impact of Brexit may also be felt in some of the most personal issues faced by individuals and families. Increased globalisation has seen a rise in cross-border families. Where relationships break down, the end of the transition period will change the legal landscape for families who have connections both to the UK and to an EU Member state.
EU regulations impact on jurisdiction, enforcement, divorce, parental responsibility, child abduction, maintenance obligations and service of proceedings in cases with a European element. The UK Government's position on negotiations with the EU suggests that it will not seek a bespoke arrangement with the EU as regards cross-border family cases. At present, where a couple could divorce in England or another EU Member state, proceedings will take place in whichever court is first engaged. This has led to jurisdiction "races", with international parties seeking to start their case in the country they feel will be more sympathetic to their position. English courts are known to be generous to the financially weaker party. Once the transition period ends, rather than the first court engaged determining the application, the courts will have to determine which country is better placed to hear the dispute. This could lead to significant costs and delay, as spouses end up litigating about where the litigation should take place. Couples who have decided to embark upon the divorce process may wish to consider whether to issue their petition before the transition period ends.
Principles of automatic recognition and enforcement will also change, both for financial orders on divorce and orders in relation to children. The current reciprocal legal framework for orders regarding children, set out in European Union, Council Regulation (EC) No 2201/2003 ("Brussels IIa"), ensures that a certified order from one Member State providing for "access" (or contact) between a parent and child will automatically be recognised and can be enforced in another Member State without any further process being required. This will not be the case after the end of the transition period and parents may need to consider whether to have an order made by the English court formally registered in the other country prior to that date.
During the transition period, free movement rights continue to apply to EU nationals and their family members. As such, until 31 December 2020, EU nationals can enter the UK without visas and live and work in the UK without any immigration restrictions.
EU nationals and their family members already living in the UK before 31 December 2020 must make applications under the EU Settlement Scheme by 30 June 2021, otherwise they will be illegally in the UK, regardless of the length of time they have been in the UK.
EU nationals and their family members arriving in the UK from 1 January 2021 will require a visa under the UK's immigration rules. The Home Office has indicated that changes will be made to the UK's immigration rules which will widen the current rules for obtaining a "work permit" visa - known technically as a Tier 2 (General) visa.