The UK Parliament has approved the draft Protection against the Effects of the Extraterritorial Application of Third Country Legislation (Amendment) (EU Exit) Regulations 2019 which will transpose the EU blocking statute into UK domestic law in the event of a no-deal Brexit. The EU Blocking Regulation aims to offset the unlawful effects of third country extra-territorial sanctions on EU operators. The new UK Regulations are particularly relevant following the EU’s response to the re-imposed US sanctions against Iran (see our previous blog post here).
The draft regulations are made under the European Union (Withdrawal) Act 2018, which permits amendments to be made to EU legislation brought into domestic law on ‘exit day’ so that it makes sense as domestic legislation. The Explanatory Note to the Regulations states that the UK regulations make changes to the EU rules “to ensure that these rules operate as UK rules after withdrawal”. For instance, the provisions prohibiting EU persons from complying with the relevant third-country legislation will become provisions prohibiting UK persons from doing so.