Last Thursday, 23 June 2016 the United Kingdom (UK) held a referendum to vote to stay or leave the European Union. The decision to exit the European Union (EU) took many by surprise.
In the past week, we have had some interesting conversations with clients, intermediaries and friends about what this means for Gibraltar. Given the amount of interest, we have decided to write to you to provide some clarity because we feel it is important that people understand the procedure that exists for the withdrawal of a Member State from the EU.
Business as Usual
The procedure confirms that it is very much a case of business as usual for a number of years to come and that therefore people should not expect any dramatic change for a considerable period of time.
The UK and Gibraltar remain a part of the EU. EU law will continue to apply until the withdrawal agreement comes into effect a number of years later.
This means that financial consumers and depositors will still be protected by EU laws, and businesses will still be able to rely on access to the EU.
There is unity from all political parties within Gibraltar and agreement to work together in order to face any challenges of the vote to exit the EU. There will be a uncertainty in the short-term but this also presents great opportunities.
The Chief Minister announced that as the Government of Gibraltar campaigned vigorously for a Remain vote, they were also working on the preparations for what has now happened.
“The top priority has been in working towards a sustainable alternative economic model and making best use of the time we have now to position Gibraltar’s economy whilst the complex task of uncoupling the UK from the EU and building new trading and political relations take place”.
The Referendum result is not the legal trigger for the UK’s withdrawal from the EU.
The legal count-down will start once the UK Government gives formal notice of withdrawal to the EU under Article 50 of the Treaty. Therefore, the commencement of this procedure is entirely in the hands of the UK. The UK Prime Minister has already indicated that he will leave this task to his successor in the autumn.
The exit agreement would first require the consent of the European Parliament, followed by the approval of the Member States acting by Qualified Majority Voting. There is therefore no veto on the content of the agreement.
The final details of the new relationship with the EU will not be known until those negotiations have taken place and a new arrangement has been agreed.
Points to Remembers
- Ignore all the “hype” and commentaries by people who really do not understand Gibraltar’s legal relationship with the UK and the EU.
- Gibraltar and UK remain part of the EU
- Business as usual for a number of years to come.
- Continued protection by EU laws
- Markets often panic. They have panicked a lot worse than this many other times. The important thing to remember is that markets will recover.
- If you are a long term investor then remain invested. Stick to your plan!
- New opportunities will present themselves.
- Gibraltar retains its many advantages as a financial jurisdiction – Click here for more info.
Our team stand ready to answer any queries you may have – please direct these to firstname.lastname@example.org or speak to your Europa relationship manager.
Could UK companies look to SA to trade in EU? – read our article here.
Working with Europa Trust Company Ltd
Europa Trust Company Ltd is part of the Europa Group. We have been based in Gibraltar for 30 years and have built a reputation as a stable and reputable business.
We provide a comprehensive range of company and trust formation and management services including company and trust administration, corporate directors, shareholders and secretaries, accounting, marine registration and other associated services.
Our clients are an eclectic mix of international executives, authors, sportsmen, corporations, wealthy individuals, families and many more. Their individual interests and needs are at the centre of our focus.
Each client benefits from the experience and multi-jurisdiction knowledge of a dedicated Europa Trust Company Ltd professional. Europa Trust Company Ltd is able to work in over 31 jurisdictions around the World.
We are licensed and regulated by the Financial Services Commission and ISO 27001 (Information Security Management Systems) and ISO 9001 (Quality Management Systems) certified.