Brexit will affect UK expats

Banking and insurance are among the areas still not settled

Brexit looks like an unavoidable reality now that UK Prime Minister Theresa May (Conservative) has stated there will be no second referendum to approve the final conditions. The UK is set to leave the European Union on March 29, 2019, and so far a lot of the details still are not settled.

The British government has published some guidance for British expats living and working in EU countries such as the Czech Republic. Some details have already been agreed to, and others are still pending. But, in short, there is a transition period from March 30, 2019, to Dec. 31, 2020. Expats will have certain rights to live and work in the EU guaranteed but may be required to apply for residency documents.

Complete details can be found on the UK government website at

The site should be updated as more information is available.

But there is the possibility that there will be a “no deal” Brexit, meaning the UK and the EU failed to agree on conditions for key areas. One key point that would affect expats is that they may lose access to bank accounts based in Britain, as the UK would not have access to EU money clearing structures. Insurance would also be affected.

This could also impact on people who receive salaries or pensions from UK-based firms.

“In the absence of action from the EU, EEA-based customers of UK firms currently passporting into the EEA, including UK citizens living in the EEA, may lose the ability to access existing lending and deposit services, [and] insurance contracts (such as a life insurance contracts and annuities) due to UK firms losing their rights to passport into the EEA, affecting the ability of their EEA customers to continue accessing their services. This could impact these firms’ ability to continue to service their existing products,” The UK government website states. The EEA includes the EU plus additional countries.

While the UK government states its intention to protect its citizens abroad, it admits that it has limitations in what it can do. “The UK authorities are not able through unilateral action to fully address risks to the EEA customers of UK firms currently providing services into the EEA using the financial services passport,” they state.

The government is shifting some of the responsibilities to the lending firms themselves. “Many UK financial services firms who currently passport into the EEA are taking steps to ensure that they could continue to operate after exit, for example by establishing a new EU-authorised subsidiary. This would allow the UK firm to offer new services after exit through its EEA subsidiary, and in some cases existing contracts could be transferred to the new entity,” the government states.

The UK website has a rather technical explanation of what a no deal Brexit would mean for businesses and individuals regarding banking and insurance here

Aside from that, the free movement of goods between the UK and the EU would stop without an agreement. This means that EU made goods could become more expensive in the UK, and UK goods would be more expensive in the EU. This is in part due to changes in value added tax, as the UK would be taxed as a non-EU country.

While the UK government states it is confident that these issues will all be worked out before the Brexit takes place, critics say the slow progress in negotiations means that there is actually a high likelihood that the “no deal” scenario will become a reality.

UK expats have felt that they have been largely ignored in the planning for a Brexit.

Expats in Spain, France and Italy, represented by pro-EU advocacy group UK in EU Challenge, are trying to challenge the original 2016 referendum, claiming that the Leave campaign broke electoral laws and as a result the Brexit vote was unconstitutional.

There are some 6,698 Britons living legally in the Czech Republic with a residence permit for 12 months or longer. Of those, 2,030 have a permanent residence. 

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