Since the summer of 2016, the German Government has been preparing for Brexit and making arrangements for all possible scenarios.
At the end of November 2018, the Withdrawal Agreement and a Political Declaration on future relations were endorsed by the Heads of State and Government of the EU27 as well as the British Government. Further steps are now needed for the withdrawal date, 29 March 2019, to enter into force. The Agreement must be approved both by the European Parliament and parliament in the UK.
If it is ratified by both parliaments, it will enter into force with a transition period until 31 December 2020, which can be extended once until the end of 2022 at the latest, thus cushioning the impact of Brexit. Although the UK would no longer be a member of the EU or represented in EU institutions during this time, it would remain bound to EU regulations. Future relations between the EU and the UK would be negotiated during the transition period following withdrawal on 29 March 2019 and enter into force after the end of this period.
For further information on the Agreement reached, please click here.
Withdrawal without an agreement (“no deal”)
If the Agreement is not ratified, the UK’s membership of the EU would end at midnight (CET) on 29 March 2019 under Article 50 of the Treaty on European Union (provided that an extension of the deadline is not agreed between the UK and the EU27). The UK would then be a third country as regards the EU, and the EU acquis would no longer apply to it.
Although it is a clear priority for the German Government that the Agreement enter into force, in view of the steps still needed for ratification, it cannot be precluded that the UK will leave the EU without an agreement. The German Government is thus focusing on this case of an unregulated or disorderly Brexit. It is a priority for the German Government that the negative impact be cushioned as much as possible for those affected by Brexit.
That is why it is particularly important that all members of the public and companies in Germany affected by Brexit keep themselves informed about what will happen. All of them should prepare thoroughly and in good time for the UK’s withdrawal from the EU.
The Federal Foreign Office is coordinating the German Government’s preparations
As the lead ministry, the Federal Foreign Office is coordinating preparations for Brexit in Germany, liaising closely with all other federal ministries and the Federal Chancellery. The German Government is prepared for all possible eventualities.
It is liaising closely with the European Commission and the EU27 (the EU Member States excluding the UK) because the measures at EU level and in the Member States must be dovetailed.
The German Government is also in regular contact with the German Bundestag and the Bundesrat. It is communicating extensively with the Länder. To ensure that Brexit planning is coordinated within the German federal system, it is essential to include the Länder and their administrative regions in the preparations.
Furthermore, the German Government maintains a dialogue with civil society, representatives of members of the public affected by Brexit, scientific organisations and members of the business community. It keeps all those affected up to date with progress in the negotiations and possible consequences arising from the UK’s withdrawal from the EU.
What would happen in the case of a disorderly withdrawal?
Brexit may have an impact on people’s plans for their personal and professional lives, particularly if the withdrawal is disorderly. The German Government has undertaken a host of measures at various levels for this case in order to cushion the possible effects as much as possible.
The German Government’s contingency plan is clearly defined
The German Government has adopted a series of measures for the case of a disorderly Brexit. These measures are clearly defined:
- They have been drawn up as transition or emergency measures, are of a temporary nature only and are defined as narrowly as possible in terms of their field of application.
- The aim is to cushion undue hardship and in certain narrowly defined cases to protect the principle of good faith.
- As far as possible, they will deflect disadvantages for German and EU27 nationals and companies.
- The idea is to clearly delineate the difference between EU membership and non-membership.
- Finally, they are to fundamentally remain unilateral. It is not in the interest of the German Government to conduct negotiations with the UK on individual regulatory areas that would lead to a “Brexit à la carte”.
Individual measures by the German Government and the EU
Below you will find further information on specific topics that may be of interest to you for your own preparations.
Information for members of the public
If no withdrawal agreement is reached with the UK, the law by the Federal Ministry of Labour and Social Affairs will uphold the principle of good faith and protect existing provisions as regards social security rights.
In the case of a disorderly Brexit, the German Government will draw up a transition regulation to help UK and German nationals who apply for citizenship before the withdrawal date, that is, by 29 March 2019, in Germany or the UK. They will be allowed to retain their previous UK or German citizenship even if the decision on their citizenship application is made after the withdrawal and provided that all other prerequisites for citizenship are met before Brexit.
German nationals in the UK
German nationals in the UK can address their questions to the German Embassy in London:
Residence status for UK nationals
If the UK leaves the EU without an agreement, the legal status of the UK citizens concerned will change permanently. They will lose their status as citizens of the Union or family members of a citizen of the Union and will become third country nationals instead. In the case of a disorderly Brexit, no UK citizen will have to leave Germany immediately. The German Government is planning a transition period, initially for three months, which can be extended if approved by the Bundesrat. This transition period would come into effect via a ministerial ordinance by the Federal Minister of the Interior, Building and Community. The legal status of UK citizens as regards residence and employment would not change during this period. However, they would have to apply for a residence permit during this time.
Click here for more information.
A disorderly Brexit on 29 March 2019 would have an impact on students who receive a grant from the German Government (BAföG) to attend school or university in the UK. With the end of the UK’s EU membership, grants for attending school or university in the UK could only be provided for up to a year and not for the entire education period, as has been the case so far. In addition, UK students and their family members who began their education course in Germany before Brexit under EU freedom of movement legislation would only be entitled to a BAföG grant as third-country nationals.
For education-policy reasons and in order to prevent undue hardship as a result of students stopping their education, it is planned that regulations to protect the principle of good faith will be added to the Federal Training Assistance Act for a transition period for German and UK students in school or higher education that qualifies for a BAföG grant at the time of Brexit.
Information for travellers
The European Commission provides comprehensive information for people travelling between the EU27 and the UK.
Information for companies
The Federal Ministry for Economic Affairs and Energy provides extensive information for companies to help them prepare for Brexit.
Trade associations also provide information. For example, the Federation of German Industries has published a compendium of comprehensive guidelines and practical questions to help companies prepare for Brexit.
The Association of German Chambers of Commerce and Industry has adopted a similar approach by publishing a Brexit checklist.
In order to compile the concerns of the German business sector and to cover as many relevant issues as possible in a single reference book, a number of German trade associations have drawn up a “Brexit compendium”.
The European Commission also provides extensive information on preparing for Brexit.
Preparing customs for more checks
In order to prepare for Brexit, the Federal Ministry of Finance and the customs administration are working closely together and making extensive preparations for the impact of the possible Brexit scenarios. The main point to bear in mind is that the customs administration has experience of dealing with goods from third countries. However, it is to be expected that more processing and checks will be needed at times. The work of the customs authorities, particularly at the main international ports and airports that serve as hubs for international postal and courier services, will thus need to be increased as required. Authorities in regions where postal and courier services have operated distribution centres dealing with deliveries to and from the UK will also be affected.
Tax law and financial market regulation
The German Government has introduced legislation creating tax regulations to cushion undue hardship following the UK’s withdrawal from the EU. It also contains transition regulations for the financial market sector aimed at preventing a detrimental impact on financial stability and insurance holders in Germany.
For German companies that were set up in a British legal form, particularly that of a private company limited by shares (Ltd.), a simplified option for changing the company into another legal form in a regulated manner has been created for a transition period. The aim is to prevent undue hardship. The law entered into force on 1 January 2019.
Further information from the European Commission
The European Commission provides extensive further information to help those affected by Brexit to make their own preparations.