Theresa May, the prime minister of the United Kingdom of Great Britain and Northern Ireland, has given notice to the European Union (EU) under Article 50 of the Lisbon Treaty, and the UK will now leave the EU on March 29, 2019.
It is possible for that date to be delayed or even brought forward, but to do so would require the approval of all twenty-seven continuing members of the EU, so, in practical terms, there is unlikely to be any amendment to the timetable.
In the next two years, the British government must negotiate the terms of its departure from the EU and its future relationship with those twenty-seven countries. Whatever agreements are struck between the UK and EU must be ratified by each of the twenty-seven continuing members individually. While negotiations were unable to begin before the notification under Article 50, the commencement of negotiations proper may be delayed to some extent pending both the French and German elections in April/May and September 2017, respectively, as well as the “snap” UK general election held June 8, 2017.
This article was written immediately after the Article 50 notice. Developments are occurring daily, as governments, companies, and individuals react to the departure of the UK from the EU (“Brexit”). Accordingly, this article must be seen as a snapshot, or part of a continuing process.
Immediately after the notice was given, Lloyd’s reacted. The chief executive officer of Lloyd’s, Dame Inga Beale, announced that Lloyd’s would be establishing a subsidiary in Brussels, Belgium. This move is not, as some ill-informed press reports have asserted, a complete move for an institution that has graced London since 1688. It is a move to allow the market to continue to write the less than 5 percent of its business that comes from the EU.
The EU (and throughout I will refer to the EU as if it excludes the UK, although the UK is still part of the EU until 2019) accounts for around 12 percent of Lloyd’s premium income. This is about the same as the volume of premium that it derives from Canada and little more than it received from Australia. There are historical reasons for that. Lloyd’s has had access to the Canadian and Australian markets since those markets began, whereas it has had access to the EU only since 1992.
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