Brexit

Personal

Brexit will have potentially far-reaching implications for individuals' personal affairs. 

Tax

Individuals with assets in multiple jurisdictions should consider their investment portfolio and whether any changes would be appropriate now that the transition period is over. In particular, although domestic tax provisions are unlikely to change significantly 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 gifts and inheritance. Advice may be required from a number of different jurisdictions to make tax-efficient decisions.

Trusts

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.

Succession Planning

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 have gone 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. 

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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 was 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.  Now that the UK is no longer part of the EU, the issue is no longer a matter for debate; the UK is undoubtedly 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 specialist advice in order to minimise uncertainty after their death.

Family

Brexit has impacted on 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 has altered the legal landscape for families who have connections both to the UK and to an EU Member state.

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The previously applicable EU regulations impacted on jurisdiction, enforcement, divorce, parental responsibility, child abduction, maintenance obligations and service of proceedings in cases with a European element. Since 1 January 2021, there have been no bespoke arrangements with the EU as regards cross-border family cases. Previously when the UK was subject to EU law, where a couple could divorce in England or another EU Member state, proceedings would take place in whichever court was first engaged. English courts are known to be generous to the financially weaker party. This led to jurisdiction "races", with international parties seeking to start their case in the country they felt would be more sympathetic to their position. Now, 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 can lead to significant costs and delay, as spouses find themselves litigating about where the litigation should take place. Those undergoing separation, who would prefer one jurisdiction over another should think carefully about whether they can persuade a court that their preferred jurisdiction is an appropriate one.

Principles of automatic recognition and enforcement have also changed, both for financial orders on divorce and orders in relation to children. The reciprocal legal framework for orders regarding children, set out in European Union, Council Regulation (EC) No 2201/2003 ("Brussels IIa"), ensured that a certified order from one Member State providing for "access" (or contact) between a parent and child would automatically be recognised and could be enforced in another Member State without any further process being required. This is no longer the case for orders obtained after 1 January 2021 and parents may need to have any order for contact formally registered in the other country before it can be enforced there. 

Immigration

During the transition period, free movement rights continued to apply to EU nationals and their family members. As such, until 31 December 2020, EU nationals could enter the UK without visas and live and work in the UK without any immigration restrictions.

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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 require a visa under the UK's immigration rules. Changes to the UK immigration rules have been made to widen the scope for obtaining a "work permit" visa, now known as a Skilled Worker visa.

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