Doubts about a new bill on EU self-employed in the UK

Last night in a quiet corner of a committee corridor in the House of Commons, the fate of EU self-employed people and their right to work here in the UK was discussed by a committee, which raised more questions than it answered.

MPs debated the Draft Freedom of Establishment and Free Movement of Services (EU Exit) Regulations 2019; not an exciting title but a potentially important piece of law for anyone reading who is currently self-employed in the UK or the EU – or would like to be in future.

Details of the legislation and the Government’s intentions are vague at best. But, in short, it appears this new law would end the current right of EU citizens to set up as self-employed in the UK in the event of a ‘No-Deal’. The business minister responding for the Government, Nadim Zahawi MP, inferred this was in part to do with the EU not reciprocating on the rights of UK self-employed people to continue working in the EU. So, if you have a contract in the EU, it may be that your right to continue that contract is in a grey area. This is mainly because of a lack of explanation from the EU and the UK government.

Confused yet? Well, hold on.

In the government’s explanatory note on the legislation, it says that any EU nationals who are self-employed in the UK and have “rights of residency” before Brexit will retain their status after it. So, those with permanent residency and settled status should in theory be able to continue living in the UK. If someone is a dual citizen of the UK, they will be unaffected. Where it gets complicated, however, is a person’s right to be self-employed in the UK. Again, for self-employed EU citizens based here and UK self-employed citizens working in the EU, this is a big question mark.

This was echoed last night in the debate by Labour’s Shadow Small Business Minister, Bill Esterson MP. He pointed to the diverse range of self-employed people this will affect, from IT contractors to those in the gig economy, and the real lack of an impact assessment from the government. Esterson also shared two other legitimate concerns with the minister: about the ability to see contracts through and knowledge of self-employed people’s immigration and work status in the UK.

Alison Thewliss MP of the Scottish National Party also had her doubts. These centred around her view that the legislation should be considered as part of the Immigration Bill (as argued in an analysis by the Public Law Project (PLP)). The PLP make a concise point in their briefing note that because this concerns the immigration status of a set of EU citizens it is only right that it should be considered as part of the Immigration Bill.

Until the Government lays out an impact assessment, and helps self-employed people answer some these essential questions, there may be unwelcome surprises if we end up leaving the EU without the Withdrawal Agreement in place.

Meet the author

Jonathan Lima-Matthews

Senior Policy Adviser