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What are the implications of UK exit from the EU?

Wednesday May 18, 2016 at 1:15pm
Should we stay or should we go?

The IPM has been in many conversations regarding the implications of an EU exit. As Members of CAP, the IPM is looking to advise its members of the Code implications should an exit happen.

In the rounds of discussions about 'Brexit' or 'Bremain', it's important to understand what, if anything, might change for marketers. Below, we set out some key 'need to knows' and you can come and talk to us at any time about the potential implications for you, your brands and of course your business. 

When does the Referendum take place?

On 23 June this year the UK electorate will vote on whether to remain in or leave the European Union (‘Brexit’). The official campaign period started on 15 April and polls currently show very close figures for both outcomes.

What you need to know now

A vote to leave the EU will create a period of significant political uncertainty but we do not consider that it will cause immediate substantive shocks to the advertising self- and co-regulatory systems.    

  • In many places the Codes approximate or have regard to EU legislation but in the majority of cases these are EU Directives that have been transposed into UK law (e.g. CPRs). These would remain in place until / unless they were repealed. Regulations (for example the NHCR) are not implemented in UK law and would likely pose questions of justifiability, but would continue to have effect until the UK actually left the EU.  
  • Questions, concerns and lobbying activity are likely to build slowly over time. The main effect on CAP, BCAP and the ASA would likely be the resource and cost implications (particularly in regulatory policy and public affairs functions) of engaging with government departments, taking legal advice and answering internal and external queries related to ‘Brexit’.  
  • Marketers need not do anything differently at this stage and should look to maintain compliance with the Codes on an ongoing basis, irrespective of the outcome on 23 June.​

As there is much uncertainty around what the exit process would look like overall and particularly whether negotiations about the UK’s relationship with EU post-exit can be dealt with concurrently or not.  

What seems certain is that legislative time and the public debate during the exit period will be dominated by the exit process and renegotiation of bigger economic issues such as trade deals. For better or worse issues which affect advertising regulation are unlikely to be a priority.

 

What happens if you are working across several territories?

Here, we look at European law and the Codes.

There are two types of European law: Directives and Regulations.  

  • Directives are required to be transposed by member states, so there is always a corresponding piece of UK legislation. In these instances the UK legislation would endure beyond a UK exit until or unless it was repealed by parliament.  However it may face challenges on the grounds of justifiability and whether any harmonisation required by the EU in its application should reasonably continue.  
  • Regulations apply across the EU by default and do not require domestic implementing measures. Although these would technically remain in effect in the UK until it left the EU, without any UK implementing legislation and with a diminished risk of censure at a European level marketers might begin to question the need to comply with them.  
  • The UK government has said that EU-originating legislation will “continue to be law until parliament decides otherwise”, however issues of the justifiability and enforcement of those laws are likely to arise before parliament is able to grapple with them.  
  • Both the CAP and BCAP Codes (and therefore the ASA in their enforcement) in places either approximate or have regard to various pieces of European law or the UK implementing legislation. Where CAP and BCAP’s rules have their roots in those laws they are likely to encounter similar issues.
If you'd like to discuss further or simply need more information, please contact us on 020 7291 7730 and speak to our Legal Team.
» Categories: General, Self Regulation, Legal