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Pinsent Masons bolsters its Trade Group in Düsseldorf

Pinsent Masons continues to expand its Competition, EU & Trade Group, with the appointment of competition law specialist, Prof. Dr. Hans Jürgen Meyer-Lindemann, as a partner in the Düsseldorf office.

Regarded as one of the leading competition practitioners in Germany, he joins from Dechert, where he was a senior partner. Hans Jürgen’s focus will be on clients within the Advanced Manufacturing & Technology (AMT) sector, including Life Sciences.

Hans Jürgen’s work includes handling high-profile merger control cases before the European Commission and national competition authorities; major cartel investigations in a variety of industries; and numerous litigation matters concerning both public and private enforcement before local and district courts, Germany’s Federal Supreme Court and the European courts.

Commenting on Hans Jürgen’s appointment, Alan Davis, Head of Competition, EU & Trade at Pinsent Masons said: “We are delighted to welcome Hans Jürgen to the Competition, EU & Trade Group. Hans Jürgen will work closely with the Head of our German Competition Team, Michael Reich in Munich. His outstanding reputation, track record and wealth of experience in German and EU competition law significantly strengthens our pan-European competition law practice advising on complex merger and anti-trust cases.”

Head of the Advanced Manufacturing & Technology (AMT) sector, Florian von Baum added: “Across the AMT sector, we are seeing more disputes with a competition law background and Hans Jürgen’s expertise means that we can support our clients as their needs develop and change. His skillset, knowledge and experience will enable us to deepen our ability to offer high quality competition law advice across the sector and I look forward to working with Hans Jürgen.”

His appointment follows the appointment of Robert Vidal, formerly head of Taylor Wessing’s UK competition team, in the Competition, EU & Trade Group in London and brings the number of partners in the Group across the UK and Germany to nine. The team is currently advising on EU, UK and German antitrust enforcement investigations in the pharmaceutical, financial services, construction and manufacturing sectors, as well as mergers and market investigations. The team is also advising on a variety of competition litigation matters, including follow-on and stand alone damages claims.

€2 billion to fast forward the creation of European Innovation Council

Ahead of the 21-22 March European Council discussion on innovation, industry and competitiveness, the Commission takes decisive steps to set up a European Innovation Council.

Global competition is intensifying and Europe needs to deepen its innovation and risk-taking capability to compete on a market increasingly defined by new technologies. That is why the Juncker Commission is introducing a European Innovation Council (EIC) to turn Europe’s scientific discoveries into businesses that can scale up faster. Currently in its pilot phase, the European Innovation Council will become a full-fledged reality from 2021 under the next EU research and innovation programme Horizon Europe.

Carlos Moedas, Commissioner for Research, Science and Innovation said: “With the European Innovation Council, we don’t simply put money on the table. We create a whole innovation system to place Europe at the forefront in strategic technologies and innovation that will shape our futures such as artificial intelligence, biotechnology and zero-emission energy. We must focus on the needs of the innovators, who are the ones who will generate jobs, strengthen our global competitiveness and improve our daily lives.”

The Commission launched in 2017 the pilot phase of the European Innovation Council, introducing open competitions and face-to-face interviews to identify and fund Europe’s most innovative start-ups and SMEs.Since then, 1276 highly innovative projects have already benefitted from an overall funding of over €730 million.

Today the Commission announces important steps that will ramp up the remaining two years of the pilot phase of the EIC:

Over €2 billion of funding in 2019-2020: covering the innovation chain: “pathfinder” projects to support advanced technologies from the research base (opens tomorrow); and “accelerator” funding to support startups and SMEs develop and scale up innovations to the stage where they can attract private investment (open in June). Under the “accelerator” funding companies will be able to access blended financing (grants and equity) of up to €15 million.

The Commission will appoint 15 to 20 innovation leaders to an EIC Advisory Board to oversee the EIC pilot, prepare the future EIC, and champion the EIC globally. Innovators from across the ecosystem are invited to come forward by 10 May.

The Commission will recruit a first set of “programme managers” with leading expertise in new technologies to provide full-time, hands-on support for projects. The call for recruitment will be published shortly.

Also today, the Commission announces 68 additional startups and SMEs selected for an overall funding of €120 million under the existing EIC pilot. The companies are for instance developing a blockchain-based online payment technology, new energy efficient screens and a solution to fight traffic noise (breakdown of beneficiaries per country and sector).

Given the growing economic importance of breakthrough and disruptive innovation, and based on the early success of the EIC pilot, the Commission has proposed to dedicate €10 billion to the EIC under Horizon Europe, the EU research and innovation funding programme for 2021-2027.

Background

With only 7% of the world’s population, Europe accounts for 20% of global R&D investment, produces one third of all high-quality scientific publications, and holds a world leading position in industrial sectors such as pharmaceuticals, chemicals, mechanical engineering and fashion. But Europe needs to do better at turning that excellence into success, and generating global champions in new markets based on innovation. This is particularly the case for innovations based on radically new technologies (breakthrough) or markets (disruptive).

In June 2018, the Commission proposed the most ambitious Research and Innovation programme yet, Horizon Europe, with a proposed budget of €100 billion for 2021-2027. The proposal builds on the Commission’s contribution to the EU Leaders’ meeting on 16 May in Sofia “A renewed European Agenda for Research and Innovation – Europe’s chance to shape its future”, which highlighted the need to create a European Innovation Council and other steps to ensure Europe’s global competitiveness.

The conclusions of the European Council of 28 June 2018 endorsed the setting up of the EIC under the next long-term budget (2021-2027). EU leaders invited the Commission to launch a new pilot initiative on breakthrough innovation within the remaining period of Horizon 2020, in order to pave the way for a fully-fledged EIC in Horizon Europe.

The European Innovation Council is part of a wider ecosystem that the EU is putting in place to give Europe’s many entrepreneurs every opportunity to become world leading companies. Other initiatives include a Pan-European Venture Capital Funds-of-Funds programme (VentureEU), the Investment Plan for Europe (EFSI), the work of the European Institute for Innovation and Technology, the Capital Markets Union Action Plan to improve access to finance or the proposal for a Directive on business insolvency.

When is the real Brexit deadline?

Less than 180 days to go and the pressure is on. Talks between the UK and the EU are at deadlock, with the intractable Irish border problem the biggest stumbling block. But here’s the catch: they must also set aside time for the deal to be reviewed and ratified by both sides.

In the United Kingdom, parliament must vote through the withdrawal agreement into law, while on the European side, it must receive the support from member states and the European parliament.

We all know that the clock is ticking. But political process on both sides means the real deadline is not 29 March itself. So just how much time is there?

On the EU’s side, Danuta Huebner, who chairs the European Parliament’s Brexit committee, has suggested that approval could be granted as late as the 11 March 2019. Meanwhile, the fact that the EU commission has continually updated EU capitals and institutions throughout the negotiations means that they would be unlikely to reject the agreement – even if it were presented to them as late as March.

But there are several reasons why delaying the vote until March would be politically problematic. First, although national parliaments in the EU will not be voting on the withdrawal agreement, some heads of governments may still be still required, in line with their own parliamentary traditions, to discuss the deal before and after the vote takes place. The Danish parliament’s European committee, for example, has a strong tradition of organising hearings ahead of EU votes and, in some cases, has even managed to influence the government’s position.

Second, the EU is conscious that the longer it discusses the terms of the UK’s exit, the less time it will have to discuss the future trade and security relationship. The way negotiations are organised means that discussions about the future can only take place once a withdrawal agreement has been reached. Many predict these discussions to be far more complex and question whether a future deal can be reached during the transition period which, providing it goes ahead, will end in December 2020.

Third, businesses on both sides are demanding greater clarity on the UK’s position after March 2019. For them, the longer the talks last, the less time they have to draw up new plans.

For all these reasons, the EU has provisionally set the date of 17 November to vote on the withdrawal agreement. But it is also in the UK’s interest to reach a deal by the end of the year.

For starters, there is actually a UK legal requirement that the government reach an agreement with the EU by 21 January 2019. In the absence of an exit deal, the UK parliament could put pressure on the government to change course – it is not clear how the prime minister would survive such a vote.

But even if the UK and the EU did reach an agreement by January 2019, there is no guarantee that the UK parliament would support it. Worse still, if it did reject the deal, it is hard to see how both sides could negotiate and ratify new exit terms by March 2019. Faced with such a dilemma, is it time to be thinking about extending talks beyond March 2019?

Legally speaking, this could be possible. According to Article 50, talks can be extended beyond the two-year negotiating framework, although this would require the approval of all 27 member states as well as the UK. But politically, this might prove complicated.

First, it is unclear how long talks would be extended for. The EU parliament elections are planned for May 2019, so a Brexit vote would need to take place either before the elections or after a new parliament is in place. The elections will also lead to the appointment of a new commission in the autumn, possibly even a new president. The EU may be reluctant to vote before the end of the year.

Second, it is unclear what would happen to the transition period. Currently, the transition is due to end at the end of 2020, at the same time as the current EU budget. During this time, the UK would continue to be part of the single market and customs union – although it would have no formal say or vote over new EU legislation. As a consequence, the UK may be asked to contribute to the new EU budget if it wanted to continue accessing the single market and customs union beyond 2020. It is hard to see how UK politicians would accept this.

When voting takes place depends largely on how quickly the UK and the EU reach an agreement. If they fail to reach a deal by 21 January 2019, or if the UK parliament rejects it, then frankly, all bets are off.

Assets worth $1tn to shift from UK to EU due to Brexit

Assets worth nearly £800 billion ($1 trillion) are being moved from Britain to new financial hubs in the European Union ahead of Brexit, consultancy EY said on Monday.

Britain, which is due to leave the bloc in March, has yet to approve a deal to avoid an abrupt severing of ties with the EU. Although the British parliament is due to vote on a proposed settlement next week, it is unclear if it will be approved.

“The closer we get to March 29th without a deal, the more assets will be transferred and headcount hired locally or relocated,” Omar Ali, UK financial services leader at EY, said.

EY has been tracking the Brexit plans of 222 financial firms since Britain voted in June 2016 to leave the EU. In its latest update to the end of November 2018, it said that 80 firms are considering or have confirmed relocating assets and staff.

The latest estimate from EY says that £800 billion in assets would move, a fraction of Britain’s £8 trillion banking sector.

Frankfurt Main Finance, which promotes the German financial centre, has said it expects €750 to 800 billion of assets to transfer there alone, largely during this quarter.

Around 2,000 new European roles have been created by financial services companies in response to Brexit, with Dublin, Luxembourg, Frankfurt and Paris the most popular locations, EY said.

Forecasts of hundreds of thousands of UK financial jobs moving to the EU have not materialised, and the Bank of England expects about 4,000 jobs to have moved by March 29.

“Whilst roles will no doubt move from the UK, many firms are only moving those employees deemed essential and are hiring locally given the expense of relocation,” Ali said.

Moves so far would be only the “tip of the iceberg” if there is a no-deal Brexit, EY said.