Brexit deal defeat raises further concerns for businesses
Written by staff reporter
Business sentiment around the ongoing Brexit talks is somewhat frayed after the government lost last night's vote in Parliament on its proposed deal. Even if yesterday’s deal had been passed, our future relationship with the EU would still be unclear, and as it is, businesses are left with even more questions than they had before.
“Yesterday's vote has answered no questions and is now raising others," says Clyde & Co partner, Mark Hemsted. "Firms complain about the lack of certainty around Brexit -- and for those firms with vehicles and drivers moving regularly between the UK and mainland Europe, that lack of certainty is being compounded by the rapidly diminishing time left before the UK is due to leave the EU.
“With regard to motor insurance, we're still awaiting clarification on a range of issues including what happens when a UK motorist driving their own vehicle has an accident in the EU. Yesterday's vote has answered no questions and is now raising others."
The situation with the broking community is more complicated due to equivalence rules. President of London FOIL and herself a partner at the law firm, Jennette Newman, is more upbeat; she envisages a pragmatic solution will be agreed before the 29th March as “no continuity is in no one's interests”.
"Last night's vote against the proposed withdrawal deal means that uncertainty over Brexit continues, which is not good for business, especially for financial services firms,” she said. "However, the London Market insurance community has in many ways led the way in being prepared for all Brexit eventualities and has played to its strengths as a unique environment for covering risk. Notwithstanding remaining issues around contract certainty in some jurisdictions in the event of no deal, I am confident that it will continue provide vital insurance and reinsurance business in the EU, even if that will be made harder by Brexit.
"Even if the deal had passed, our future long term relationship with the EU remains unclear and will be subject to protracted negotiations. The London Market can't and won't wait for absolute clarity and needs to use Brexit as an opportunity to focus without distraction on some of the broader systemic changes in the sector.
"It must redouble its modernisation efforts to ensure it's as efficient an insurance centre as possible, continue to place itself at the heart of the innovation taking place in the sector, and appeal to a more diverse talent base that will provide the broad range of new skills that will be needed in the insurance sector in the next ten to twenty years."