On June 23, just hours after we published our last edition, the United Kingdom voted to exit the European Union. Brexit, as it has come to be known, immediately raised a number of issues of potentially enormous significance for financial services providers and their customers and clients — not just in the UK and EU, but the world over. The next day, markets dropped significantly, with the decline continuing on Monday. By Tuesday, however, things began to calm and most markets began a steady climb to a point that is now above where they were before the Brexit vote.
As you can see from our sidebar section “WE ARE ALSO THINKING ABOUT,” our firm already has begun to analyze the many ways in which Brexit may impact the world’s economy; however, one thing is clear — it is too soon to definitively determine what the nature or the extent of the impact will be.
Certainly, the UK and EU will operate differently than they do today, but just how differently is extremely unclear. Given that, by most estimates, the UK’s actual withdrawal is at least two years away, the interested parties clearly have time to work through the details and, one would expect, create an outcome that is the least disruptive on those economies and, indeed, the global economy. In the end, things could look quite different two years from now or, perhaps, the final structure of the UK/EU economy will be barely different from what exists today.
We suggest that you read the various analyses linked in the sidebar, as they provide a helpful collection of insights into what is happening and what is likely to happen. Of course, we will continue to keep you apprised on these pages about important developments with respect to this issue, and we will link you to additional DLA Piper articles that analyze the issues that are sure to emerge as things move forward.