Update: Andrew Jones answers the question of whether Brexit will affect the foreign property in your succession planning.
The question I have been asked most in the last week or so is: Does Brexit affect the EU Succession Regulation, also known as Brussels IV or EU Regulation No. 650/2012?
I am pleased to be able to reassure most of my clients that, broadly speaking, the answer is “no”.
To put this question and its answer into context: the EU Succession Regulation came into force in August 2015. The purpose of it is to enable someone who has assets in one country but is a national of another country to elect for the law of their nationality to apply to those assets, upon their death. The idea behind the regulation is to simplify the estates of people where, previously, there might have been conflicts to deal with between the succession laws of the two nations involved.
As it happens, the UK did not sign the regulation, along with two other EU countries (Ireland and Denmark). The consequence was that if the assets were in the UK, and the nationality of the person involved was elsewhere in the EU, the regulation simply did not apply anyway. However the reverse situation was quite common, and the regulation did apply to it, namely the situation where the assets were in a signatory EU country, and the owner’s nationality was in the UK. A very common example of this was someone who was British but had a second/holiday home in France or Spain.
Thankfully, for those people the situation is not affected by Brexit. France and Spain are signatory nations to the EU succession regulation and, therefore, in respect of assets situated in those countries, anyone can elect for the law of their nationality to apply. The county of nationality can be anywhere in the world – it does not have to be another signatory nation and it does not even have to be in the EU. For that reason, Brexit has not changed the status of the regulation, as far as British nationals are concerned.
If you have British nationality but own assets in the EU, you should contact us to review your estate planning.