Mon Nov 19 2018
Following the triggering of Article 50 by Theresa May in March 2017, the UK is due to leave the European Union on 29 March 2019. The future relationship between the UK and the EU after this date currently remains unclear. But at Barclaycard, we’ve been considering all the possible outcomes of the Brexit negotiations to make sure we can continue to provide all our services to all our customers in the UK and Europe.
As a result, Barclaycard Payment Solutions are busy preparing for the possibility of a ‘hard Brexit’ where the UK also leaves the European Economic Area (EEA).
Over the coming months, we’ll continue to serve all our merchants as normal whatever the outcome of the Brexit negotiations. In this article we give an overview of our own approach to Brexit, and to find out more about the Brexit negotiations you can read this article published by Barclays Corporate Bank.
For many years, all of our UK and other EU merchants have been contracted to, and served by, Barclays Bank PLC (BBPLC). What this means, is:
As a result, Barclaycard is well prepared for a ‘hard Brexit’ and a loss of ‘passporting’. Barclaycard is planning to implement its solution by March 2019.
Based on the location of your business’ legal entity, you’ll need to be aware of the following:
For UK entities: You don’t need to do anything – there will be no change and Barclaycard will continue to provide all payment services through BBPLC.
For EEA entities: We’ll need to make arrangements to change your supplier: from Barclays Bank PLC (BBPLC) to Barclaycard International Payments Ltd (BIPL) before 29 March 2019.
If you fall into this latter category, we’ll send you an amendment to your contract. It’ll reflect any change in the legal entity providing services to customers with appropriate prior notice.
Barclaycard doesn’t intend to give such contractual amendments effect unless and until required. Our plan is to deal with this as smoothly as possible with minimal disruption to your business.
There may also be some changes required to the setup of your account, but we’ll advise you of those in due course.
Having set out Barclaycard’s strategy over the coming months, we’ll now look at the background and wider aspects of what’s expected to happen with Brexit.
A transition or implementation period will begin after the UK leaves the EU in March 2019, and end 31 December 2020. That’s a little shorter than the two-year period the Prime Minister proposed in her speech in Florence in September 2017.
The EU explained that the UK will have to continue to adhere to all existing EU regulations during this period, including the ‘four freedoms’ of movement of goods, capital, services and people.
Phase two of the negotiations started in March 2018 and is expected to end by the autumn.
However, any future relationship between the UK and the EU cannot be formally agreed until the UK ceases to be a member of the Union in March 2019.
The EU has indicated that the UK can expect similar access as that available to other countries, based on what it wants.
The above is based on a desire to respect EU directives on the Single Market and Customs Union.
The UK has set out its two preferred options:
Read more analysis of the government and EU positions on the future relationship.
The UK articulated what it sees as the fundamental building blocks of the future relationship when Theresa May gathered her Cabinet at Chequers to force a common position upon it.
As such, the Chequers proposals and subsequent White Paper mark a ‘softer’ Brexit stance by the government than previously set out. In terms of the actual White Paper, the paper states that, at the topline level:
Most of our customers will not be impacted by our Brexit plans as they’re already contracted to a Barclaycard entity that is legally allowed to provide them with services after Brexit.
If you have any questions about these changes, please get in touch with your Barclaycard account manager.
In addition, to help with our preparations, we encourage you to review what Brexit may mean for your payment processing needs, regardless of where your corporate HQ is located, and let your account manager know of any areas of concern. We’re here to support with any changes that may be required.