Brexit & the Future of Agents’ Legal Protections

To be clear, the fact of Brexit on 31 January 2020 does NOT of itself amend or repeal the rights and protections afforded to commercial agents under English law, by virtue of the Commercial Agents (Council Directive) Regulations 1993. This is on account of the European Union (Withdrawal) Act 2018 (‘EU(W)A’), which Act preserves the status quo of agents’ rights going forward. In this regard, section 2(1) of the 2018 Act provides:-

‘EU-derived domestic legislation, as it has effect in domestic law immediately before exit day, continues to have effect in domestic law on and after exit day’.

By section 7 of the EU(W)A, anything which is ‘retained EU law’ (as defined by section 6(7) to include ‘EU-derived law’) cannot (post Brexit) subsequently then be amended other than by an Act of Parliament, or by secondary legislation.

In respect to the above and put another way, the Commercial Agents Regulations, post Brexit, will therefore basically continue to operate and be in effect in this Country, unless and until, at any appropriate juncture in the future, the law changes (which of course is the point – i.e. the law in this area may indeed (sooner or later) change as a consequence of it then being a decision of the UK (rather than the EU) parliament as to what the future legal landscape in this Country should look like).

In practice, it is of course very difficult in the current climate to predict the future, and much may boil down to what is ultimately negotiated as between the UK Conservative government and the EU, and as to what (amongst other things) a ‘level playing field’ actually means. Maybe in this regard, and as one example, the EU, and as part of the negotiation for a future trade deal, will successfully oblige the UK to effectively maintain laws which afford commercial agents the same basic protections as are reflected by the original EU Directive, in which case, and in fundamental terms, perhaps nothing very much will in practice change at all. Alternatively, and possibly depending on the terms of any deals which the UK has by that stage concluded or otherwise has in the pipeline with any non-EU countries, or perhaps otherwise depending as to how the UK wants to present itself to the outside World as to future levels of regulatory obligation in this Country (compared with the EU), the UK government will ultimately either procure us leaving the EU with no relevant deal at all, or otherwise be able to strong arm an agreement with Brussels which leaves it [the UK] with very little commitment in terms of having to continue with the same degree of workers’ protective legislation, such as that which is embodied in (for example) the Commercial Agents Regulations.

Whereas there is of course precedent of non-EU member States (such as Norway (as a member of the EEA) and Switzerland (which has its own special agreement)) having in place arrangements with the EU which includes legislation which affords agents basic statutory protections (such as, as an example, the right to a form of compensation on termination), it is perhaps also fair to say that Brexit has (however) been mould breaking in terms of its significance and effect, and so that precedent as to upon what basis other countries have in the past struck deals with the EU may actually turn out be a poor guide.

The above all said, it is obvious that the sorts of very important obligatory protections currently afforded to commercial agents in this Country (such as (and just as examples) long stop dates for the payment of commission, minimum basic notice entitlements, and the requirement in relevant circumstances to pay either compensation or an indemnity on termination) seem no more than what is essentially fair, and so that to return agents to the relative Dark Ages of (in the main) relying (merely) on what might possibly have been successfully negotiated as part of a written agreement, appears potentially to reflect a much harder Brexit outlook.

Essentially, we will all need to watch this space.

 


 

© David Bentley, Bentley Agency Law Limited, Bentley & Co Solicitors 7 Littlemoor Road, Pudsey, Leeds, LS28 8AF 

T: – 0113 236 0550 e-mail:- db@bentleyandco-solicitors.com.

The ONLY law which we practice is the law as it relates to commercial agents.

Please ensure that you obtain specific legal advice before acting in reliance upon anything in this article, particularly since each individual’s circumstances may necessitate a unique approach, and also on account of the fact that the law may of course at any time change. Furthermore, please be very clear that information given in this column may not cover or otherwise refer to all possible angles, aspects, relevant information and/or points of law and so that all or any information which is given above needs in every instance to be referred for specific legal advice for clarification and amplification, before being relied upon.

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