Brexit: What’s The Deal?

– Talking Brexit at MaMA
from left: Annabella Coldrick, Clémentine Bunel, Isla Angus, Dick Molenaar, Michael Dugher and Nicolas Madelaine

A top-class cast of panelists was invited to this year’s MaMA conference in Paris to discuss the known and the unknown surrounding Brexit, Britains attempt to leave the European Union as a member state.

Two words were used more often than any other: complicated and uncertainty. 

Most panelists, including Annabella Coldrick (MMF UK), Clémentine Bunel (Coda Agency), Isla Angus (ATC Live) and Michael Dugher (UK Music), drew a bleak picture in view of a so-called no-deal Brexit, which has emerged as the term describing a British departure from the European Union, without clearly defining the future relationships with the remaining member states.

Only Dick Molenaar (All Arts Tax Advisers/Erasmus University Rotterdam Tax Advisers) was more optimistic, pointing out that Britain and the EU had already come a long way in their negotiations.

The discussion was moderated by Nicolas Madelaine, journalist at Les Échos, the Financial Times of France.

To sum Brexit up briefly: a referendum of the people of Britain on the subject of leaving the European Union was held in the UK on June 23, 2016. In a voter turnout of 72 percent, 52 percent voted leave, 48 percent remain.

Today, the only thing that really remains, is the fiercely emotional battle of arguments between Brexiteers and Remainers, a “very complex public game of multidimensional chess,” as Dugher, who was a member of the British parliament before joining UK Music, described it. 

He explained that Britain’s prime minister Theresa May was currently pushing for a longer transition period, intending to add a few months onto the current 21-month timeline, which a large number of MPs called “a betrayal of the referendum.”

The EU reportedly just expressed its willingness to extend the transition period. 

Dugher saw “huge practical concerns,” seeing that the entire process was “incredibly complicated and uncertain. Nobody knows. I don’t think anybody has the faintest idea if we’re going to get a deal.”

Molenaar responded that he didn’t think the matter was too complicated, pointing out that talks between Britain and the EU were in an advanced state, according to what he heard on TV and read in the papers.

The tax expert was convinced that many issues had already been solved by the negotiators, and pointed to documents published by the UK government in August, highlighting what would happen in case of a no-deal Brexit, stating that EU citizens already living in the country would have nothing to fear. VAT issues between the UK and the EU member states also seemed to have been solved.

He concluded that both sides had a lot to gain from a good deal.

As far as Brexit’s impact on the country’s live business is concerned, Coldrick fears that artist could lose access to the European market, if the free movement of people as well as goods was restricted.

In case a deal is reached, artists from the EU touring the UK would be able to apply for a visa waiver scheme, currently available to artists from a list of non-EU countries. The scheme seems to work quite well and isn’t too expensive, according to the feedback Coldrick has been receiving from international agents and managers.

In case there is no deal, the UK will have to come up with its own Visa requirement scheme, and Coldrick worries that it could resemble that of the U.S., where many artists have been refused entry in the past.

UK artists touring Europe would require a so-called Schengen Visa, which they currently don’t. The Schengen Visa is for citizens not part of the so-called Schengen Area, which currently encompasses 26 European countries. Since the European refugee crisis, applicants are heavily scrutinized, dragging on the application process.

Some panelist worried that a no-deal Brexit could impact the relationship with the U.S. negatively, making it harder for UK artists to get a Visa to tour stateside.

Bunel shared her experience with artists from Africa, who have to go through an insanely complex process to be able to tour the UK or Europe. They require a UK sponsor to write a certificate of sponsorship, which is basically a work permit, usually filled out by the agent.

It is valid for creatives and sports people, and costs £234 per person. A band from Africa with ten to twelve people adds up. What is more, the length of stay determines the price. If they want to stay more than six months, additional fees apply.

This would resemble the process for artists from Europe in case of a no-deal Brexit.

According to Bunel, the UK is not known for paying international artists particularly well, so a £10,000 festival fee will go pretty fast in the case of bands with multiple members. And that’s not even mentioning the stress it caused them.

Angus explained, that, as things stand, U.S. artists can’t start a tour in Ireland and then come to the UK, even if it’s just a transit flight via Ireland’s capital Dublin. Quite a few UK festivals were faced with this issue this summer.

She pointed out the lack of ability to do forward planning, as long as uncertainty about the terms of Britain’s exit remained, and added that, as the UK economy slumped, the Pound would loose value, and festivals would have an even harder time paying international artists.

The smaller bands would, of course, be impacted the most by any changes, Madelaine said, adding that DJs, who are often required on short notice, could suffer as well.

Among the things UK Music has been proposing to the the British government in case of a no-deal Brexit, is a form of touring passport that would replace the Visa waiver scheme.

Dugher said, being ale to tour freely was key to the UK maintaining its worldwide status as a leading nation in music. So far, however, no statements made by the government suggested they were taking such a touring passport seriously.

Angus mentioned the production and nightliner companies based in the UK, which would certainly lose business if delays at the border were to be expected. A lot of European companies would start hiring companies on the continent.

As would American acts who used to hire production and transport in the UK, but stick with it for their entire European run.

The main concern for the recorded music and publishing sectors in a post-Brexit world is the question of protecting the intellectual property of rights holders. There’s is no certainty that the current EU regulations can be seamlessly transferred into UK law.

Molenaar also addressed the dreadful state for the European royalty system, where artists still wait for years, in some cases, until their royalties arrive in their bank account. The EU has long-since been calling for a reform of the continent’s performing rights organizations, pushing for a central agency to guide the flow of royalties more efficiently.

 

Britain’s PRS For Music had good chances of becoming this central licensing agency, according to Molenaar. It would, of course, loose that prospect in case of a Brexit.