July 17, 2018
In-house lawyers in Europe spending less than 10% of their time on Brexit, finds Thomson Reuters survey
Survey reveals ‘business as usual’ mentality in companies in Europe despite on-going uncertainty surrounding UK’s exit from the European Union.
LONDON, July 18, 2018 – As the U.K. reaches the second anniversary of the Brexit referendum, a report published today by Thomson Reuters Legal business reveals that in-house lawyers in mainland Europe are spending less than 10% of their time on Brexit-related matters.
It is two years since the UK voted narrowly in favour of leaving the European Union, and while Brexit has dominated column inches, business commentary, and the overall political agenda in the UK, research from Thomson Reuters Legal business finds that three quarters of in-house legal departments in mainland Europe are allocating less than 10% of their time preparing for Brexit, with the majority dedicating no time at all.
The report, entitled “Attitudes to Brexit – In house lawyer perspectives across Europe”, reveals that only a handful of respondents are spending more than 25% of their time readying themselves for the impact of Brexit.
When asked how demand for their legal department’s services may change, 63% of respondents predicted it will be business as usual, increasing to 73% when respondents have no legal needs in the UK. Respondents based in Spain predict no impact at all on demand for their services. Conversely, those most likely to predict increased demand on the organisation’s legal department resided in the Netherlands (43% anticipate an increase), followed by Germany (40%), Italy (36%) and Switzerland (29%).
However, when presented with a no-deal Brexit scenario, the picture changes dramatically, with more than half of respondents expecting demand on their time to increase following the no-deal Brexit scenario.
“The ‘business as usual’ mentality revealed in the findings of our research stems from the uncertainty around the precise form Brexit will take,” said Jim Leason, VP of Market Development & Strategy at the UK & Ireland business of Thomson Reuters. “This uncertainty is acting as a blocker to in-house teams preparing fully for the impact of Brexit. While some of the more proactive organisations are already conducting reviews, most are waiting for a formal Brexit framework before making concrete decisions. They may be disappointed if no agreement is reached and the UK leaves the EU in March next year without a deal.”
In total, only 5% of respondents were spending more than 25% of their time on dealing with Brexit. Proactive respondents were more likely to work in Financial Institutions. When asked about current day-to-day demands on time, it was shown that a significant portion of in-house legal departments’ time is spent on commercial contracts/drafting (35%), industry regulation/compliance issues (14%), litigation/disputes (11%) and managing external counsel (10%); and less than 25% of time spent on advising senior management and the business.
When looking more closely at how respondents were preparing their organisation for Brexit, the survey found that proactive respondents are taking a number of clear steps, including; seeking external legal advice, establishing a Brexit steering committee, and conducting internal risk reviews. The areas of greatest concern from those who had undertaken Brexit audits are in the area of customer contracts, business licences and supplier contracts.
When asked about the tools these in-house legal departments were using, while 50% or more of respondents are using legal research, know-how and document/knowledge management tools, less than 20% of respondents are using document review, contract and document automation tools.
“With a no-deal Brexit scenario still a very real prospect for the UK and EU in less than nine months, in-house lawyers in mainland Europe may be leaving their Brexit preparations too late,” added Leason. “This report shows that these lawyers recognise that demands on their time will increase if this happens, and that they may not have the tools to enable them to meet the demand efficiently if it transpires.”
The research, which was conducted by Thomson Reuters in conjunction with Acritas, the professional services research agency, was undertaken to assess the potential impact of Brexit on European in-house legal departments. Thomson Reuters and Acritas spoke with 254 respondents across mainland Europe to understand how in-house legal teams will be reviewing risks and reacting to changes as a result of Brexit.
To access a full copy of the report, go to: Attitudes to Brexit – In-house Lawyers’ Perspectives from Europe.
Thomson Reuters is the world’s leading source of news and information for professional markets. Our customers rely on us to deliver the intelligence, technology and expertise they need to find trusted answers. The business has operated in more than 100 countries for more than 100 years. For more information, visit www.thomsonreuters.com.
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