On March 29, Theresa May’s government will face a new debate at the House of Commons on the divorce deal, already rejected twice by MPs. Aim of the discussion is to ask the English Parliament to back the withdrawal agreement only, i.e. the terms of the UK’s exit from the EU, leaving out the declaration outlining future UK-EU relations. If approved, such agreement should allow the UK to benefit from a postponement of Brexit to May 22, instead of April 12.
In this uncertain scenario, Law Decree n. 22 dated 25 March 2019 was published in the Italian Official Gazette n. 71 of 25 March 2019. The Decree includes “Urgent measures to grant safety, financial stability and market integrity” in case of a no-deal Brexit.
Moreover, the Decree was issued to ensure continuity in the provision of banking, financial and insurance services by both UK-resident entities operating in Italy and Italy-resident entities operating in the UK and to regulate an orderly exit from the Italian market of UK-resident entities which will terminate their activity in Italy.
The Decree provides for an 18-month transition period, starting from the day the UK will withdraw from the EU, indicating the effects that a no-deal will have on banking and insurance intermediaries’ operations.
During this transition period, the following provisions will still be applicable to the UK: domestic tax provisions applicable due to its being an EU member State (including those originating from EU directives) and domestic provisions deriving from VAT and excise duties directives, to the extent they are compatible. Such provisions will be enacted through specific Decrees by the Ministry of Economics and Finance.
Bernoni Grant Thornton Brexit Committee is available to assist you. Please contact comitatobrexit@bgt.it.gt.com for any clarification you may need.
