Brexit Clause Contract Example: Protecting Your Business in a Post-Brexit World
The United Kingdom’s decision to leave the European Union (EU) has left businesses uncertain about the future. Many are searching for ways to protect themselves against the potential economic, regulatory, and legal ramifications of Brexit.
One option is to include a Brexit clause in commercial contracts. This clause helps businesses adapt to the changing legal and regulatory landscape by outlining the parties` rights and obligations in the event of a “hard Brexit” or other significant changes to EU-related laws.
Let us explore an example of a Brexit clause contract that can protect your business interests:
Brexit Clause Contract Example:
In the event of a hard Brexit or the United Kingdom’s departure from the European Union without a free trade agreement, this contract shall be subject to the following terms and conditions:
1. Force Majeure: If Brexit results in any material adverse effect on the performance of this contract, including but not limited to restrictions on imports or exports or increased tariffs, either party may terminate this contract upon written notice to the other party.
2. Payment Terms: If the parties have agreed on a currency for payment and the value of that currency fluctuates significantly due to Brexit, the parties agree to negotiate in good faith to amend payment terms as necessary.
3. Regulatory Compliance: If Brexit results in changes to applicable laws or regulations that affect compliance with this contract, the parties agree to work together to ensure compliance with all legal requirements.
4. Governing Law and Jurisdiction: In the event of a hard Brexit or the United Kingdom’s departure from the European Union without a free trade agreement, this contract shall be governed by English law and the parties submit to the exclusive jurisdiction of the courts of England and Wales.
5. Alternatives: In the event that this Brexit clause contract is invalidated or becomes unenforceable, the parties agree to work together in good faith to renegotiate other terms and conditions that are consistent with the intent of this clause.
Conclusion:
The inclusion of a Brexit clause in commercial contracts can help businesses navigate the uncertainties of the post-Brexit world. Consulting with legal experts and reviewing existing contracts is essential to ensure that the Brexit clause is appropriate and effective in protecting your business interests. The above Brexit clause example can be customized to suit specific business needs, making it an essential tool for businesses to protect their interests in the face of Brexit.