Brexit in chaos after court rules PM's suspension of parliament was unlawful

Prime Minister Boris Johnson’s suspension of the British parliament was unlawful, a Scottish court ruled on Wednesday, prompting immediate calls for lawmakers to return to work as the government and parliament battle over the future of Brexit.

Scotland’s highest court of appeal ruled that Johnson’s decision to prorogue, or suspend, parliament from Monday until Oct. 14 was unlawful — a blow for the government as it seeks to leave the European Union on Oct. 31 with or without a deal. With seven weeks until Britain is due to leave the EU, the government and parliament are locked in conflict over the future of Brexit, with possible outcomes ranging from leaving without a deal to another referendum that could cancel the divorce.

“We are calling for parliament to be recalled immediately,” said Scottish National Party lawmaker Joanna Cherry, who led the challenge, after the verdict by Scotland’s Court of Session. “You cannot break the law with impunity, Boris Johnson.”

The government said it would appeal against the ruling to the Supreme Court, the United Kingdom’s highest judicial body.

Johnson announced on Aug. 28 that parliament would be prorogued, saying the government wanted the suspension so it could then launch a new legislative agenda.

Opponents said the real reason was to shut down debate and challenges to his Brexit plans. The court was shown documents that showed Johnson was considering prorogation weeks before he formally asked Queen Elizabeth to suspend the legislature.

Nigel Farage

Buckingham Palace declined to comment on the ruling. Misleading the monarch, who under Britain’s unwritten constitution must be apolitical, would be considered a grave affront.

Johnson, who was a figurehead for the Vote Leave campaign in the 2016 referendum, when 52 percent of voters backed Brexit, has rejected opposition complaints that he was denying parliament the right to debate Brexit in an undemocratic way.

Dominic Grieve, one of 21 Brexit rebels thrown out of Johnson’s Conservative Party last week, said that if Johnson had misled the queen over the reasons for prorogation, he should resign.

“If that were to be the case that this had happened, Boris Johnson would find himself in an untenable position in parliament,” Grieve told BBC TV.

Brexit up for grabs

Johnson’s bid to quit the bloc “do or die” on Oct. 31 has hit the buffers: parliament has ordered him to delay Brexit until 2020 unless he strikes a deal while a new Brexit Party is threatening to poach Conservative voters.

After three years of tortuous Brexit crisis, British politics is in turmoil, with the prime minister blocked by parliament and an election or even a second referendum on the cards.

In an excoriating judgment, the Scottish judges ruled the principal reason for parliament’s suspension was to stymie lawmakers and allow Johnson to pursue a no-deal Brexit policy.

“This was an egregious case of a clear failure to comply with generally accepted standards of behaviour of public authorities,” concluded one judge, Philip Brodie, according to a summary of the court verdict.

Judge James Drummond Young had determined that “the only inference that could be drawn was that the UK government and the Prime Minister wished to restrict Parliament”, it added.

Labour splits

The 2016 Brexit referendum showed a United Kingdom divided about much more than the EU, and has given rise to soul-searching about everything from secession and immigration to capitalism, empire and modern Britishness.

It has also triggered civil war inside both of Britain’s main political parties as dozens of lawmakers put what they see as the United Kingdom’s fate above that of party loyalty.

The divisions in the opposition Labour Party over Brexit were on display on Wednesday, when its deputy leader, Tom Watson, said he supported pressing for a second referendum before an early national election.

“So let’s deal with Brexit, in a referendum, where every person can have their say, and then come together and fight an election on Labour’s positive social agenda on our own terms, not on Boris Johnson’s Brexit ‘do or die’,” he said in a speech in London.

His argument, which puts him at odds with leader Jeremy Corbyn, is that an election might fail to resolve the deadlock over Brexit. Corbyn says Labour would offer the people a second referendum on a credible option to leave against remaining in the EU after an election.

Nigel Farage, leader of the Brexit Party which could take votes away from both main parties, offered Johnson an election pact on Wednesday but warned that unless there was a clean break with the EU, the Conservatives would take a “real kicking” in any election and could not win a majority.

“If we go beyond the 31st of October and we are still a member of the European Union — which looks increasingly likely — then a lot of votes will shift from the Conservative Party to the Brexit Party,” Farage told reporters.

How Brexit will affect Fintech companies in the UK

The delay of Brexit is caused by divisions on how the United Kingdom should leave the EU and what the future relationship should look like.

Possible solutions range from revoking Article 50, the piece of legislation that enacted the result of the 2016 referendum and committed the UK to leave, to leaving the EU with out a deal, a so-called ‘hard Brexit’.

A withdrawal agreement drafted by former Prime Minster Theresa May was defeated three times with MPs voting against it.

There has been a petition to cancel Brexit with millions signing it, marches demanding a second referendum, and marches about the way new Prime Minster Boris Johnson is handling the withdrawal process.

The net result is that many, many business owners across all sectors and all parts of the UK are unsure of what the future holds for them and their employees.

Fintech and Brexit

London is perceived as the ‘Fintech Capital of Europe’. It has an ever-growing number of start-ups and established companies, all of which have a positive impact on the city. Job creation has increased by 61% over the past year according to recruitment firms across London. This growth makes financial technology the fastest growing sector in the London economy.

With such promising statistics, how will Brexit affect growth and positive impact within the current economic state?

The UK’s fintech sector has continued to progress since the Brexit vote. The United Kingdom has always encouraged innovation, creating a surge of growth, thus increasing investment opportunities for not only local investors but also international investors. This injection of finance aids the growth of fintech companies.

Brexit, however, seems to be limiting UK fintech companies operating with European companies, with factors such as trade and employment becoming valid concerns.

Brexit has given Fintech companies and the investment community pause for thought, with many risk factors to consider. This has not hindered growth by any means but still provides uncertainty in Europe whilst negotiations continue in the weeks, months and possibly  years ahead.

If we start to see a loss of investment and talent from the European region, this can be compensated by potential employees and job seekers from other territories, such as Asia, coming to the UK. London will still remain a global capital of fintech, but that’s not to say there may be a decline in growth compared to other regions.

How can fintech companies prepare for the worst?

Despite the growing fintech sector in London, preparing for the worst is diligent and necessary. One means of preparation will be to build investor and international relationships which if not already done, will be vital for future development.

Doing so provides opportunities following the possible disinterest of EU and local investors.

Any estate agent will tell you property sales are in decline, and the reason for this is due to the uncertainty of the property market following Brexit, so people are staying put. This applies to the job sector where staff are staying in their positions due to employment uncertainty and vice versa, where companies are retaining staff and reducing turnover.

As mentioned before, the London fintech market is currently in a strong position, and is filled with innovative and forward-thinking companies.

It goes without saying that for many companies, if not all, service is key as customers are their bread and butter. It would be advisable to improve current services or to create and onboard new services to deliver value to your existing and future clientele. Giving your clients a reason to stay.

A localised service makes you specialised and focused on what you offer and to whom. If Brexit were to limit or cut off your current European clients, you will need to look to expanding your offerings to accommodate for your ‘once was’ audience and adapt to change.

To conclude

The UK remains the most welcoming country for fintech businesses in terms of the regulatory framework, so regardless of how Brexit unfolds, it will maintain a certain competitive edge over its European neighbours.