Impacts of no-deal Brexit within the mandate of the Ministry of DefenceThe United Kingdom (UK) has notified its intention to withdraw from the European Union (EU), following the outcome of a referendum held in 2016. The UK will leave the EU on 29 March 2019, which is the date of expiry of the two-year period for negotiating the terms of withdrawal under the Treaty on European Union.
If the withdrawal agreement enters into force on 30 March 2019 as planned, nearly all provisions of EU law will continue to apply to the UK until at least the end of 2020 under the transition period provisions in the withdrawal agreement. Should the withdrawal agreement not enter into force on 30 March 2019, the UK leaves the EU without a deal.
Additional information on matters outside the mandate of the Ministry of Defence: Prime Minister’s Office
If the United Kingdom leaves the European Union without a withdrawal agreement (a ‘no-deal Brexit’), it will immediately become a third country outside the EU, with no transition period or special arrangements. This also means the UK would no longer be part of the single market or the customs union and the application of EU law would cease.
This would mean changes in the licence procedures for exporters of defence-related products: the procedures defined in the directive on the transfer of defence-related products within the Community (2009/43/EC) and transfer licences used in the European Economic Area (EEA) would no longer apply to exports to the UK.
Regulations concerning third countries would then apply to the export of defence-related products to the UK and such products could be exported only if permission to export is granted. As a rule, export to third countries requires foreign and security policy assessment.
The countries to which foreign and security policy assessment does not apply are specified in a government decree on the general requirements for evaluating licence applications for the export of defence-related products (311/2013). If the UK exits the EU without an agreement, export of defence-related products would require that a foreign and security policy assessment be made. In practice, this means that the Ministry for Foreign Affairs would be responsible for making a foreign and security policy assessment and and the working group for exports of defence materiel would deal with licence applications.
The Ministry of Defence will provide more detailed instructions related to the impacts of the UK’s withdrawal from the EU when such information is available.
A no-deal Brexit means that companies would need to take account of changes in regulations and customs procedures, among other things, when exporting their products. Regarding customs procedures at the border, it is expected that the EU would introduce third-country regulations and tariffs, including regulatory inspection and monitoring.
Companies are encouraged to familiarise themselves with the procedures and regulations concerning trade with third countries.
Tuomas Koskenniemi (Brexit coordination within the mandate of the Ministry of Defence), email address in the format email@example.com
Selina Kangas (Senior Advisor, Export Control), email address in the format firstname.lastname@example.org