What would a ‘no deal’ Brexit look like?

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Here are some of the issues covered by today's release of 25 technical documents setting out government planning and advice for businesses and citizens in the event that Brexit talks fail to reach an agreement.

University research

The UK Government has offered a guarantee to universities and research institutes receiving money through the Horizon 2020 programme, which has provided 4.6 billion euro to fund British research since 2014.

Existing research projects will not lose their funding - but the government admits that the situation is less clear in cases where British researchers are working with colleagues elsewhere in the EU.

Those projects may no longer be eligible for funding from the UK, and may not meet Horizon 2020 rules, either.

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Organic food

Over a third of British lamb is exported to the EU, and organic farmers across the UK use European standards and labels to market their products on the continent. But in a no-deal Brexit, “UK organic operators would not be permitted to use the EU organic logo” even though the government says legal standard wouldn’t change.

To have British exports recognised as organic products, “UK organic control bodies will need to apply to the European Commission,” one paper published today states. “Approval can take up to nine months, so we are exploring alternative approaches”.

The NFU has warned any interruption to trade on that scale would be devastating to organic farmers.

Tobacco

EU rules cover tobacco packaging including health warnings, and Brussels holds the copyright over the grisly images of lung and throat cancers that are currently printed on packs of cigarettes and tobacco. The UK would need to have its own warnings ready for Brexit deal under a no-deal scenario.

READ MORE: Scotland faces ‘Brexit nightmare’ warns Mike Russell
Card payments

The UK would suddenly find itself outside of EU-wide banking infrastructure known as TARGET2 in a no-deal Brexit. As a result, customers and businesses “could face increased costs and slower processing times for euro transactions”, the government warns.

For everyone buying a product or service from an EU-based company, “the cost of card payments between the UK and EU will likely increase” - so most costs associated with a foreign holiday in Europe.

In addition, a ban on card surcharges introduced by Brussels in January of this year would no longer apply to payments to EU companies - so there would be no way to block Ryanair, which is based in Dublin, from reintroducing its controversial 2% credit card fee, for instance.

Financial services

London is Europe’s leading financial services hub, with the international banks and investment houses based there working for clients across the EU. They could struggle to do so after a no-deal Brexit, because ‘passporting’ rights for service companies within the single market will end, and no new agreement will replace them.

“In the absence of EU action, EEA clients will no longer be able to use the services of UK-based investment banks, and UK based investment banks may be unable to service cross border contracts,” the government admits, by way of an example. “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.”

The government says it would seek a standalone agreement on financial services after a no-deal Brexit, but many companies have already moved to set up subsidiaries in the EU to get around any new barriers.

READ MORE: Catherine Stihler: No-deal Brexit will blight Britain for decades
Pensions for expats

One group of British citizens living in the EU set to be hit the hardest under a no-deal Brexit are pensioners, who are likely to rely on British banks and investment companies to provide much if not all of their income.

Documents state that "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, insurance contracts (such as life insurance contracts and annuities) due to UK firms losing their rights to passport into the EEA"

Fertility treatment

The UK imported around 3,000 sperm samples from Denmark, and small amounts from other EU countries, for research and fertility treatments.

Organisations would need to reach written agreements with sperm banks supplying samples to be able to continue imports, which the government says would “for the most part be a minimum burden on industry”. The same conditions would apply to import and export of other human tissue and organs.