What does Theresa May‘s resignation mean for the Business of Brexit?

Whatever your stance on Brexit, the lull in political noise following the deafening crescendo as 29 March 2019 approached might have come as a relief. With the European Parliament election results now ringing in our ears, and Mrs May stepping down as leader of the Conservative party on 7 June, noise levels are as ‘fortissimo’ as they are likely to get.

The results of the European elections, considered by some to be an unofficial second referendum, are inconclusive: presented as a victory by Brexiteers and Remainers alike. Back in our own Parliament, the Conservative party is aiming to have a new leader and, by default, prime minister in post by the end of July. So businesses can be (fairly) sure nothing too significant will happen until then.

If our next prime minister is a Brexiteer, and this looks likely, the chances of a no-deal Brexit increase significantly. Even if someone who does not back a hard-Brexit wins the leadership race, we may well proceed without a deal if the Northern Ireland backstop remains in the Withdrawal Agreement.

But what about Parliament’s vote against a no-deal Brexit in March? That vote was non-binding and a no-deal Brexit on 31 October 2019 remains the default position. If we approach that date without alternative arrangements in place, it could take drastic action, such as an early no-confidence motion in the new prime minister, to avoid a no-deal exit.

The Brexit Saga, a book you might intend to read on holiday, is, as yet, unfinished. There continue to be many moving parts, and possible endings could include one or a few of the following:

  • Further extension of the Brexit date at the new prime minister’s request
  • Renegotiation of the Withdrawal Agreement, which if passed in Parliament could allow for a pre-31 October 2019 exit
  • No-deal Brexit (31 October 2019)
  • Second referendum (now also backed by the Labour Party)
  • Cancellation of Brexit
  • No-confidence vote in the new prime minister, or a general election

Beyond July’s leadership contest, one also wonders if progress is likely to be made during August, given that Parliament and most political establishments across Europe are in summer recess.

What should businesses be doing in the meantime? They should continue to plan for a no-deal Brexit, which is looking more and more likely. Keeping up-to-date with political developments and remaining as agile as possible to react once the ending of the Brexit saga is revealed are also advisable.

To find out more about the meaning of a no-deal Brexit for your business, please click through to our article here. You can learn more about the legal implications of Brexit on our dedicated Business of Brexit page, or by contacting Kate Westbrook. We also offer a Brexit MOT for your business.

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