With Matthew Sutton, Partner
Thursday 22 October 2020
Businesses need to act now and prepare themselves for when the UK’s Brexit transition period ends on 31 December 2020.
Those that trade between the UK and EU, and GB and Northern Ireland, can expect to see several changes and the knock-on effects are yet to be understood in full. Regardless of a deal or no deal, all businesses need to be thinking ahead about their commercial contracts and supply chains come January 1.
This webinar covers:
- The current status of the UK-EU trade negotiations
- The potential impact on business supply chains and commercial contracts
- Key predictions for businesses involved in UK-EU trade and GB-NI trade and what to do next
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Webinar transcript
(Please note this is auto-generated and un-edited)
0:09
Good morning.
0:10
I'm Matthew Sutton a partner in the commercial and IP team here about Shakespeare Martineau.
0:17
Welcome to today's webinar on Commercial Contracts and Supply Chains.
0:23
So in this morning's webinar, we're going to look at a number of topics all very briefly. But you will see there's a list on the slide. So we're going to have a brief look at the current position and the state of negotiations between the UK and the European Union.
0:40
We're also then, going to spend a little bit of time just looking at what the future UK EU relationship, after the transition period will look like. Hopefully, it will be clear, at that point. I think some of us would have hoped that it maybe would be a little clearer by now, but I guess that's in the nature of things.
0:58
We're gonna look at some of the possible commercial implications of that future relationship, and how we might future proof commercial contracts, or how you might have already started doing this, or done this already.
1:10
And then we're going to spend a few minutes just looking at a couple of areas of commercial law, which are pretty sort of important in the context of commercial contracts, and see how they may change in the future, OK, so the current position there.
1:27
OK, so we all know that the UK left the European Union on the 31st of January, 2020, we entered into a transition period, which will end, at the end of this year. And the government has, and did this a long time ago, back in the, the early parts of the world, at an extension of the transition period.
1:45
So the political declaration, which was agreed at the time of the withdrawal agreement, set out the framework for the future EU UK relationship.
2:00
And you might recall that in describing that future relationship.
2:04
The political declaration refers to an ambitious, broad, deep and flexible partnership across trade and economic co-operation with a comprehensive unbalanced free trade agreement at its core. Now, the political declaration isn't a legally binding document, but both parties agreed to use their best endeavors in good faith, and in full respect to their respective legal orders, to take the necessary steps to negotiate expeditiously, the agreements governing their future relationship referred to in the political declaration. So that all sounds quite promising.
2:39
So negotiations didn't really start for a trade deal until March, and as we know, from the news, what the UK seeking is, is effectively a similar trade deal to the, the war, the European Union, as negotiated with Canada.
2:59
OK, so the UK government set a deadline of 15 to October for a trade deal, so that was the European Union Summit last week.
3:09
And as of Friday negotiate, well as off as of yesterday morning when I, when I prepared the slides, negotiations were stalled now.
3:18
If you saw the news last night or this morning, you know that they are now effectively unsold.
3:25
And trade talks are due to re commence today.
3:29
As of last Friday, the Prime Minister made a statement, indicating that the UK needed to get ready to trade with the European Union next year without an agreement, which you suggested, was an arrangement similar to Australia.
3:46
And this was in response to the European Union, position, that, before negotiations could be intensified, they needed to see further compromise, digital concessions, from the UK government.
3:57
So, again, you know, from the news that there are really sort of three issues that, uh, causing issues in the context of the negotiation.
4:07
What is fishing rights? The second one is the level playing field.
4:11
And the third one is dispute resolution so so the same, maybe slightly, I don't know what the best word is arcane paps, but I guess they sort of really go to the heart of what Brexit is about, really, and that becomes clear when you sort of think about the UK's negotiating position, which, which was set out in the Prime Minister Statement, back in February where he made three things clear, particularly.
4:39
one is that any future agreement with the European Union must respect UK, national sovereignty that the UK wasn't prepared to give any commitment, or certainly no significant commitment in relation to regulatory alignment with the European Union.
4:56
That the UK parliament would have control of, of its own laws and that for a similar reason. The UK couldn't accept any jurisdictional or dispute resolution role for the Court of Justice of the European Union, which is C J EU in that note.
5:12
So when you think about how those sort of, those sort of positions feed into the key issues while fishing rights, from a practical perspective, I guess you'd say fishing is really a, a fraction of of 1% of the UK economy.
5:29
But control of access to British waters for fishing is really, or has really become almost up a litmus test of the extent to which the UK has, I guess, taking back control to use to use it from the Brexit debate.
5:46
So the significance of phishing has almost become sort of disproportionately symbolic of the the benefits or the reasons for Brexit, I guess. Then you have this issue around the level playing field.
5:57
Well, I guess you've got on the one hand, you've got the European Union who are nervous that once the transition period ends briton will deregulate furiously so that potentially, they would be faced with a low regulation, low-cost competitor, with access to the European single market. And And obviously, that is a much with some concern for them. On the other hand, many people in the UK would argue that sort of, you know, having control over one's own laws was essentially the essence of Brexit.
6:30
And for that reason, you know, they are sort of very keen to reject any suggestion that the UK should be aligned with Brussels in the future. And that sort of plays out similarly, a dispute resolution mechanism.
6:43
This idea that you, the UK should be subordinate to the jurisdiction of off of the European Union Court. So, you can see, there's some sort of, potentially, sort of very significant issues to be resolved.
6:58
And you'll see at the top of the next slide, uh, you know, I've made a point there, about the European Union position, so that the important to them of the level playing field.
7:08
And, I guess how you've seen that manifest itself, particularly in the debate recently, is, you know, the point that sort of constantly mentioned is the extent to which the UK should be bound by the European Union's rules on state aid.
7:25
So so you have these sort of issues, which are still in play, sort of parallel to this, you've had sort of again recently in the news, the issues around the sort of the Northern Ireland protocols. So what is the Northern Ireland Protocol?
7:37
Well, again, I guess as many of you will know, the, the, the Northern Ireland protocol was negotiated and agreed as part of the withdrawal agreement. And the purpose of the protocol is to avoid a hard border on the Island of Ireland.
7:54
And the way it does this is, well, the first thing to note is that Northern Ireland remains part of the UK customs territory.
8:03
So, goods moving from Great Britain to Northern Ireland.
8:07
Don't ordinarily attract a tariff.
8:09
However, if those goods are deemed to be at risk of being moved into the European Union, then he no circumstances.
8:20
And the relevant EU tariff would be applied on movement of the goods from Great Britain to Northern Ireland on the basis that it would be the tariff would be reimbursed. If the goods can be proven, TIF stayed in Northern Ireland, so goods moving to Northern Ireland. Don't attract a tariff.
8:40
If if those goods are to stay in Northern Ireland. But if there is a risk of them moving into the European Union, then potentially the European Union type would be chargeable.
8:48
Similarly, there are no regulatory checks on on goods moving between Northern Ireland and the Irish Republic. And that's essentially because Northern Ireland will remain part of the European single market. But what that does mean is that certain goods and agricultural produce, which are moving from Great Britain to Northern Ireland, are subject to regulatory check so effectively, and this is, and this is where you sort of have this idea of a Customs border or regulatory checks border in the Irish Sea.
9:23
So that was agreed as part of the withdrawal agreement, and then we had something called the UK Internal Markets Bill. I'm onto Serco, which is intended to regulate trade across the United Kingdom once we leave the single market.
9:38
So, that all seems fairly sort of anodyne, However, it is, or it became very controversial, because, effectively, there are some provisions in that bill, which give UK ministers the unilateral power to amend how the United Kingdom implements the Northern Ireland protocol, which, which would effectively breach the withdrawal agreement.
10:00
So, the reason the government says it needs these policies to ensure that Northern Irish businesses have unfettered access to to the UK market, and there are also concerns about how the commitments in the Northern Ireland Protocol in relation to state aid may have implications for, for the, for the rest of the United Kingdom. So, it's important to say that this bill isn't law yet. It's still in the House of Lords before and then it has to go back to the House of Commons. It has been subject to a number of amendments and that might be further amendments that come into play. But I think the the bill itself proved to be quite inflammatory in talks with the European Union.
10:41
But potentially, I guess, the fact that the Belize in the House of Lords and trade negotiations, in that week commencing potentially creates a window for the trade negotiations to be completed and possible. And possibly, I guess, for the, for the provisions in the bill that were most controversial to be rendered unnecessary.
11:01
So I guess that leaves us with the issue of whether or not the reason likely to be a deal.
11:06
Well, I guess most commentators, I think, think on the balance of probabilities. And that's obviously, I guess, strengthened by the fact that talks of recommenced, that a deal is more likely than not.
11:22
So at the moment, no, we're looking at probably a choice between a Canada style trade deal and they a World Trade Organization, no deal scenario with probably a Canada style trade deal.
11:37
Being being sort of marginally favorite, OK. So before we just look at what that might mean for us, let's just have a look at where we are now.
11:49
So, in the transition period, as we know, we continue to participate in the European Union customs on the single market. The four Freedoms continue to apply, so that means there is free movement of goods, services, capital, and people.
12:07
Most European law continues to apply in the UK, and the Court Justice of the European Union continues to have jurisdiction.
12:17
There's the European Union regime of mutual recognition recognition, excuse me, if regulatory frameworks continue to apply. And we continue to have the benefit of the free trade agreements, which the European Union's concluded with various countries across the world. There is provision in the European Withdraw Union withdrawal legislation for all EU law to be converted into UK law at the end of the transition period. So that's where we are at the moment.
12:47
So where are we going?
12:48
Well, we know, I think, absolutely, definitely, that we will be leaving the single market and the customs union on first January next year.
13:01
So if we arrive at a Canadian style trade deal with European Union, what effectively does that mean?
13:07
Well, I think that the key points and possibly, I guess the most important thing I will say in the next sort of in this webinar is that Canada's stalled trade deal is does not represent the status quo so it's not frictionless trade. So this isn't sort of business as normal if we do a deal. So, kinda style trade deal would remove tariffs on most of the deal with Canada, does this, removes tariffs?
13:34
Are most, but not all goods and some agricultural projects.
13:40
eight, it increase these quotas for those of you that don't know equate to effectively is a an agreed quantity of goods which attract a zero or lower tariff, but again, it doesn't remove coaches altogether.
13:53
It does very little and has very little to say about trading services. There is some mutual recognition of regulations, but, but not been on to a great extent. And I guess the key point is that customs controls continue to apply or would apply in this case. So that would still be regulatory compliance issues, even if no tariffs, which eligible.
14:15
And rules of origins checks would still be applicable to determine which type of supply.
14:20
And we'll talk a little bit about rules of origin and how they work in, in the context of WTO rules in a few minutes. So, I'll just put a couple of figures on the bottom of the slide. So, in 20 19, 7.9% of Canada's exports went to the European Union. In the same year, 45% of UK Exports went to the European Union. So, so, so, obviously you know how that deal applies.
14:43
It's going to have a far more wider ranging impact, potentially, on the UK than that, perhaps for Canada.
14:51
So what are the other choices?
14:52
Well, obviously, if we don't get a deal, we will end up with a no deal situation, which is sometimes called a WTO option, or even the Australian option on the basis of the Australians generally trade with the European Union on World Trade Organization terms. So what does that mean? Well, it means tariffs and customs, and it means no agreement on regulatory equivalence, although, even as I mentioned even in the context of a kinda small trade deal, regulatory equivalent, and market access for services, is likely to be fairly thin, I think. But what does all that mean? What do World Trade Organization rules? Actually Me I guess some of you will want to know that the World Trade Organization is an international organization whose purpose is to facilitate trade by providing a forum in which trading parties can negotiate.
15:47
And I guess the key points to have in mind is that the WTO does not determine any tariff levels once. A member has decided what tariffs it wishes to charge on imported goods and services. It submits these to the WTO in the form of a schedule.
16:06
So, at the moment, we are bound by the European Union schedule, but we submitted the UK. Government has submitted its own schedule, which will take effect on. first January, The schedules would form the basis of any trading arrangements between the European Union and the United Kingdom.
16:24
Uh, post the transition period if, if no deal is done. So again, just some figures to put that into some context. So the average you EU tariff on knockout non agricultural products is actually quite low. It's, it's, it's 2.8%, but you'll see there are some sectors where high tariffs to apply. So, because there is a tie for 10% dairy products, 35% a number of agricultural products I think have sort of relatively high tariffs.
16:53
So, meat, as well, interestingly, form first January under the newly submitted UK Schedule, at 47% of imported products into the UK will have zero terri's compared to 27% currently.
17:10
So just a couple of points on WTO rules there. Just to put some context around what what I've just been saying.
17:17
So so the most favored nation principle essentially means that sort of in the absence of a free trade agreement between countries, all goods, which are traded between those countries, must, must attract the same rule of duty as goods charged to two other WTO members.
17:38
So, so, what this means effectively is that, in the absence of a free trade agreement, the UK couldn't imposed lower tariffs on goods from the European Union, and the European Union couldn't offer favorable terms to the UK. What this does mean is that, you know, if we don't get a trade deal than, then we will be trading on WTO terms until such time as we, as we as we do negotiate trade deal.
18:02
And the WTO Rules of Orange, we origin, well, I mentioned those in the context of customs checks.
18:08
So effectively, these will apply for funds from the first of January, so. So what these really doing are trying to determine the economic nationality of a product that is being exported so these rules will apply whether or not we do a trade deal. So the point is that, to benefit from lower tariffs exporters have to prove that the goods concern have their origin in date.
18:32
A UK, or the European Union as the case may be, now for manufactured goods.
18:37
There are also some quite detailed rules about sort of where those goods are deemed to originate.
18:43
But essentially, for our purposes, I think it's fair to say that the country of origin is the last country where a substantial transformation to those goods took place.
18:57
OK, so very briefly, where we're going with the rest of the world, well, we're no longer parties, will no longer be party to the Free Trade Agreements negotiated by the European Union. And we're no longer bound by the European Union World Trade Organization schedules. So trade will be based on our World Trade Organization schedules, which will provide a baseline from which we will negotiate or ... more preferential trade relationships with countries. And, and that's that. That's something which has been an ongoing process. You'll see not, not too long ago. There was an announcement that the UK ..., a free trade agreement with Japan.
19:41
OK, set, significant change, an end to frictionless trade on First January next year. So, how might that impact on our trading arrangements? Well, we've got some examples on this slide. So, tariffs, obviously, potentially could apply. They certainly will apply certain areas if there is no trade deal.
20:07
I guess to the extent that we are trading outside of the European Union, or people are trading outside of the European Union, type rates for trade with countries outside the European Union may change, depending upon what, What arrangements are in place, too, to carry over any, any, any, free trade agreement that has been agreed with the European Union.
20:28
Customer checks will apply, both to goods moving from u.p.d.
20:35
and the UK, and in the other direction, and there is a significant possibility of delays.
20:44
So, I guess if you see in the press at all, recently, you'll see that there is, I mean, the the quantity of goods that moves through deva, for example, is phenomenal. So 7000 trucks around some thousand trucks. Use deva every day and sort of, as Einstein, the government's Smart Freight website won't be ready for testing until until the end of November. So what this means in practice is that there is a realistic risk, I think, of of some potentially significant delay, I guess, sort of certainly during the early part of next year. So yeah, there is a real risk of delays.
21:23
I think, in emulation custom checks, regulatory, divergence, well, you'll see we've talked about, sort of, the UK's reluctance. To agree to, to, to any sort of commitment, to regulatory alignment. So many businesses will have to comply with different regulatory requirements, because report in this morning's guardian, for example, that BASF the chemical company, which has six sites in the United Kingdom as reported that it's brexit related compliance requirements, will add a billion pounds to its cost of business. And some of you, I'm sure, will know, the UK has introduced a new product compliance regime. The UK ... Mark will replace the CE mark in the UK.
22:06
Will, but will not be recognized in the European Union.
22:09
So you will still need to see Mark to sell products in the European Union, potentially, labor, while we know freedom of movement is ending, so, so clearly, a risks around that. I know there are other webinars which deal with, which will, which will be talking to you about the impact of those changes. And exchange rates well, I mean, there's nothing sort of intrinsically linked to Brexit, which will affect the exchange rate.
22:35
But obviously the, the uncertainty around the end of transition might lead to to some to some exchange rate volatility. So.
22:44
So there's some significant, I guess, commercial risks around what's likely to happen at the early part of next year. So I guess the first question, then, we probably need to think about is if the effects of some of these risks is to make contracts, loss, making it more difficult to perform.
23:06
Are you entitled to any relief in those circumstances?
23:10
And I think, unfortunately, in the absence of express drafting, the answer to that question is probably no. So the first thing I just want to talk briefly about is the common law doctrine of frustration. So, so, you don't need a specific contractual term in your documents to rely on frustration. It's a piece of law, which is, which, is, I guess, generally available, if the circumstances justified. So, when can frustration apply?
23:38
Well, you'll see the first point on the slide, the contract must have been commercially, or physically impossible to fulfill, or to have been subject to a radical change in obligations. And, I think the reason, the recent case law in this area is probably not very helpful in the context of brexit related difficulties.
23:58
I think what's been made clear is inconvenience hardship, or financial loss, will not be sufficient alone to enable a contract, a party to set aside its contractual obligations.
24:11
And, you know, the other point to have in mind, is, is when you are, sort of, are trying to demonstrate your contract, has been frustrated. The alleged frustrating event generally must be one which couldn't have reasonably be forsee.
24:27
So so that's frustration. The other, the other area, which is sometimes thought of in the context of Brexit, is force majeure. So forth, monsieur is not something which implied. You do have to have a force majeure clause in your contract.
24:40
But again, I think the general feeling is that false monsieur, a standard force majeure course is, again, probably unlikely to grant much relief in the context of a brexit related delay or failure to perform.
24:58
Again, it's generally the case that force matures events. Don't include parties, events, which party a reasonably foresees all reasonable she to foresee.
25:09
And I guess the other point about force Missouri's, even if he could potentially cover the situation, it will.
25:17
Potentially, it could potentially grant you some relief or extra time to perform a particular task. But it certainly almost certainly wouldn't do, is give you any ability to recover any additional costs.
25:32
OK, so how do you sort of future proof your commercial contracts, what sort of things should you be thinking about? Well, Brexit clause is a good idea and I'm not sure if that's probably the right term, at this stage. I mean, maybe transition period clause is a better description. So these are clauses which trigger a change in rights and obligations in the event of a defined events. So that event might be the imposition of a tariff or the UK, leading A, leaving A, the transition period.
26:00
And the idea would be, the trigger event would would give rise to a specific ability to perhaps grunts an extension of time, or to pass on certain additional costs, which are incurred as a result of the event Coveting Clause. Force monsieur, we just mentioned, generally won't apply, unless it's been sort of quiet, unusually drafted. If you're a customer, you might want to make it clear that your force mature close don't apply.
26:31
States absolutely clear. There's no confusion about force measure. Termination rights. Well, the sort of thing we're thinking about here is you do you need a more flexible exit route in relation to your contract. So, can you terminate on, convenience it relatively short notice, or, for example, in the case of specific events, or cost increase of more than a certain percentage?
26:54
Price and delivery, so, so, so, I think, to the extent you haven't already done this, and I guess many businesses will, will be well on the way of looking at all of these sort of things. And may have already done this when we were looking at a potentially sort of abrupt exit from the European Union, the end of last year. But, but, if you haven't, it's certainly not too late. You need to be looking at the pricing provisions in your contract when you're selling or buying cross border off, prices exclusive or exclusive of duties and tariffs. Is it clear?
27:26
If you're selling business goods in two other UK businesses which incorporate important components or materials, can you pass on the costs of additional duties and tariffs?
27:36
You know, how are you using Incoterms?
27:40
Will the same incoterm be appropriate at the end of the transition period?
27:45
What currency is the contract payable eat? You know, are there any? Are there any clauses which allow you some sort of flexibility to pass on any cost increases Or require you to absorb cost increases in the context of changes in the exchange rate, VAT, which I've mentioned here is just remember that, at the end of the transition period, the UK will be leaving the European regime.
28:14
Some other areas, time for delivery, where we've seen sort of how, you know, there's a potential for delays with the introduction of customs checks. Certainly, Certainly in the early part of next year. What are your commitments around? Timing, in your contracts? Can you build in some flexibility around that? So, I guess, if your customer, are you prepared to allow any flexibility around that? What are the implications for the business further down the track? Personal data transfers.
28:44
Well, again, there will be a separate webinar on this. I think for transfers from the UK to the European Union. The UK government has indicated that these arrangements can continue after the end of the transition period without additional protections being put in place, But for transfers from the European Union to the UK.
29:06
At the moment, I think, and I think this is still the case, the European Commission hasn't made a decision as to whether it sort of considers the UK to have adequate levels of protection. So it is important that your contracts include appropriate contractual provisions and some advice and some advice around that is available from the Employee Information Commissioner's website.
29:29
Personnel.
29:30
Well, we've made, we've mentioned that you need to be mindful of the changes to freedom of movement, and how that's reflected in your contracts, and the implications that might have in terms of your ability to deliver certain services within certain timeframes.
29:45
Contractual references to the European Union.
29:47
So, this is particularly relevant if you are sort of in the context of Distribution agreements or licensees where the territory refers to the European Union.
29:59
It's pretty clear that a reference to the European Union from time to time probably didn't include the UK after 31st January of this year, and certainly wasn't included after the end of the transition period. So whether a territory is to include the UK or not, I think needs to be specifically dealt with.
30:20
I think when you're talking about references to the UK in a contract, it might be worth thinking about the potential implications of Brexit further down the road.
30:29
So, for example, a reference to the UK, as composed from time to time, might reduce the scope of a territory.
30:38
If, for example, Scotland becomes independent in the next few years, so I think it's it's definitely worth looking at the territorial scope of documents where, where, where, for example, you've been licensed or appointed to exercise a right in that particular territory, change the law. So just think about how sort of the, the, the end of the transition period.
31:06
And the departure from the European Union might affect some of the provisions, which which are the legal provisions, which apply to your contract in most cases.
31:16
As I mentioned, European your law will, will be incorporated into UK law.
31:21
And this may be sufficient to to preserve the legal position in terms of your particular contract sufficiently. But, but but it is worth checking that, to make sure that is the case and enforcing UK Court judgements is the final point on this slide, dispute resolution. So at the end of the transition period, the UK will leave the Brussels regulation. So so potentially, it could make it harder to enforce UK judgements, court judgements, in, in the European Union jurisdictions. I think it is prudent to, to think about sort of, if you do need to enforce a UK judgement in a, an EU member state following the end of the transition period, I think it's prudent to assume that the law of that member state will apply to the enforcement of your judgement and and, and that you should probably take some legal advice from, A Lot of Qualified under that jurisdiction.
32:19
OK, so, So that is some of the, sort of the key elements of, sort of key topics that I think you need to think about when you are Future proof future proofing your contracts or analyzing how the end of the transition period may impact on your on your contractual arrangements.
32:37
Just a couple of areas that we'll talk about just very quickly to finish off.
32:44
And these sort of, these are topics where these are areas where, I guess there might be some change in the future, or they might be particularly, you know, there might be some particular sort of issues.
32:56
So I think the first point you made to make is that I don't think that we much change to commercial law in the short term in the UK, following the end of the transition period. Although, given the sort of the British position on regulatory alignment, I think there is a possibility of divergence in the longer term.
33:15
So, one of the areas where this might sort of come up is, is the agency, as some of you will know, there is a piece of legislation in the UK called Commercial Agents Regulations, which derives from European Union law, and applies to arrangements between a principal and a commercial agent. And a key part of that, or the key aspect to one of the key aspects of that piece of legislation, is that a commercial agent is entitled to compensation in most circumstances where the agency arrangement comes to an end.
33:47
The energy transition dot, dot, dot, dot, dot piece of law will continue to stay in force.
33:51
However, I think there is probably a feeling, some areas that perhaps that might be over protective of agents.
34:00
And I think for a government, which is possibly keen to focus on free market policies and remove what it perceives to be barriers to business, there might be some pressure to amend or repeal that legislation, at some point, in the future.
34:14
But, but, but I guess that's that's that's not something that's going to happen, anytime, soon distribution.
34:23
There is no equivalent to the commercial agents, entitlements compensation, but distribution. Distribution arrangements are generally covered. Simply by the contract between the distributor and the appointing company.
34:37
However, those arrangements, distribution arrangements are though much subject to European Union and UK competition law. Now, those laws won't change on on at the end of the transition period, however, I think there were two points to just just have in mind at the end of the transition period.
34:58
The UK effectively becomes a a third country.
35:03
Further, the purposes of E Udall, that means, at the end of the transition period, distributors who sell UK products in the European Economic area will become subject to European Economic Area importer obligations.
35:20
What those obligations comprise case goes well beyond the scope of today's webinar, but they are more onerous than Than than the obligations of an Old Redistributive. I think it's fair to say that.
35:33
The other thing tonight is that, obviously, an EU competition law rules will only apply to to business practices of UK businesses to the extent they have an effect within the European Economic Area.
35:50
Uh, to the extent they are confined to the UK than European competition, law rules apply, those are based on European Union law, so they're very similar. And they contained in the Competition Act of 1998. And they won't change at the end of the transition period. But again, over time it's possible that UK competition law could begin to diverged from European Union.
36:20
I think that brings us to the end of the webinar. So if we have any questions, I'd be very happy to answer them.
36:32
Methane, We have had a couple of questions come in. So the first one is, In terms of customs. Is there any negotiations with respect to apply any concessions to oil and gas onshore or offshore goods movements?
36:50
I think that would probably have to be one flow of energy team. I'm not sure quite what's been agreed in terms of in terms of the negotiations to date, obviously. If we go to a WTO trading model and then, then, then, then, there won't be any such concessions. So so it really depends on how the negotiations and progress that might be. one, which is probably more ..., might usefully respond to that?
37:25
We have, well, if I don't have a Brexit clause in my contracts with customers, are there any Stanley provisions I can rely on instead?
37:34
Well, certainly. So you say, if you don't have a Brexit clause in your contract, then then I guess, the sort of things that you would be looking at ease.
37:45
Just my force mature claws apply.
37:48
Now, as I've said, it's in all probability eat, eat, you want, but it's not to say it certainly won't say there might be some opportunity for it to apply. It might give you some relief from some time commitment. So it might give you a bit of extra time to perform an obligation as the saying, inevitably, I won't give you an ability to pass on any additional costs.
38:10
I guess, the other things that you should be looking at A, really, sort of: To what extent to what extent am I sort of, bounding by specific timing commitments on delivery?
38:22
Or, to what extent, for example, Es, time of delivery, an estimate, or I have some flexibility around timing? So, so, what does a delay in delivering something actually trigger?
38:34
Is it automatically a breach of contract? Or do I have a window where I can, can deliver?
38:39
Not being breach of contract will have I just given a timing commitment, which is an estimate.
38:43
So, it's really sort of know, what? what commitments have been locked down, and, effectively, if I do meet them, will constitute a breach of contract, and to what extent do I have some flexibility around them? So thank you very much for attending the webinar.
38:57
I hope you found it useful and relevant, if there is something you'd like further information on, or have a specific query on any matter that you would like to discuss, please do let me know, and I'll be happy to help. So, finally, thanks very much for, for joining this morning.
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