The exit of the United Kingdom from the European  Union, unless otherwise agreed with the EU, will entail the non-application of European  treaties. However, this would not have immediately detrimental effects with respect to loan agreements already entered into, which are now governed by English law and would therefore continue to be fully valid and effective.

It is not believed that the non-applicability of Community legislation may be invoked by a party to trigger a change of law clause, nor to invoke the occurrence of a relevant adverse  change in order to: (i) reneging on contractual obligations; or (ii) claim termination of the contract.

In the long term we will have to wait the outcome  of negotiations  with the European  Union to understand how the UK intends to define relations with other EU countries, especially if the United Kingdom will seek to remain within the European  Free Trade Association (EFTA) together  with Norway, Iceland, Liechtenstein and Switzerland, so as to continue to operate  within the European Economic Area (EEA).

A negative impact of Brexit might be the decrease of economic resources for funding of community projects by the European Investment Bank (EIB).

In fact, the United Kingdom was, after Germany and France, the third largest European  contributor having paid – between 2000 and 2014 – approximately 186.5  billion euro to the European  budget,  of which, after administrative costs,  approximately 102.6  billion euro was returned from Brussels, resulting in a total balance of 83.9 billion euro, equal to 5.5 billion euro for each  year.

It is easy to see  that a significant amount of financial resources will be removed from the European budget, and this will lead to a lower availability of resources for funding projects through the EIB. Following Brexit, in the short term, significant adverse  effects on projects and loan agreements are not expected and it will be necessary to wait until negotiations  with the European  Union have begun  in order to develop an understanding of the long-term effects of Brexit.

With respect to the availability of financial resources, the UK’s exit could have a negative effect in terms of reduced availability of financial resources to be allocated to European  funding.

You can consult and/or download the full version of the Brexit dossier here.