Brexit and the Great Beyond

At Episerver we have been discussing and planning for a variety of Brexit scenarios on behalf of our customers, partners, vendors and ourselves, to ensure a smooth transition regardless of the outcome. We felt we should share some of our thoughts based on the five most talked about and therefore possible outcomes of Brexit.

The United Kingdom of Great Britain and Northern Ireland (“UK”) is edging ever closer to the March 29 deadline imposed via the UK’s triggering of Article 50 of the Treaty of the European Union. This process is designed to begin the withdrawal of an EU member state from the union, now commonly referred to as “Brexit.” If you live in Britain, you’re probably already tired of hearing the term, but for our British customers and those who do business with Britain it is important for you to know how Brexit could affect your data flows, data processing and storage.

Proposed agreement or “May’s Deal”

This is the preferred model as positioned by the Prime Minister (PM), Teresa May and (some of) her government, as it gives the most clarity around one of the biggest issues our customers, partners, vendors and employees face with the UK’s withdrawal from the European Union. With the UK’s enactment of the General Data Protection Regulation (“GDPR”) as national law as the Data Protection Act 2018, and under advisement of the UK Information Commissioner Office (“ICO”) to abide by GDPR principles even after the UK withdrawal, it gives a good foundation for the frictionless flow of data across borders.

It is our belief that should the proposed agreement, or some variation of it, is agreed to by enough parties to be enacted, the impact to data flows, data processing and storage should be minimal, and customers on Episerver Digital Experience Cloud will be well suited to either continue as before, or make any minor modifications necessary and move forward quickly.

“Soft Brexit”

Although this model would leave the UK tied more closely to the EU, perhaps still within the terms of the EU Customs Union and EU Single Market and is seen as undesirable by pro-leave members of the May government, it would essentially provide a similar scenario as the May Deal. Unfortunately, a Soft Brexit would not address the key stumbling block of the Irish Backstop and would essentially make the EU, and not the UK, sovereign over the key economic laws of Ireland, in violation of the Belfast Agreement, and that in turn could involve the UK paying some £40 billion to the EU with little in return. However, for Episerver customers, we would expect the same or even less impact to data flows, data processing and storage than with the May Deal.

“No Deal” or “Hard Brexit”

Should the UK fail to reach a compromise deal, whether a revision to May’s deal or any alternative, which could very well happen should a satisfactory resolution to the Irish Backstop for both the EU and the UK not be found, or an extension to Article 50 is rejected on March 29 then the UK would leave without any agreed plan or working framework with the EU (i.e. crash out). The clarity here for the software industry and services sector as a whole becomes much more convoluted and less predictable.

As mentioned above, with the UK’s enactment of GDPR as the Data Protection Act 2018, gives some leverage on a position, but there is uncertainty as to how services and data flow might be encumbered under a “no deal” scenario. At Episerver, we are working with our vendors, most notably Microsoft and their Microsoft Azure™ public cloud, to enable those UK-focused customers to migrate and/or replicate their Digital Experience Cloud environments into UK-based data centers. Customers interested to find out more should get in contact with their Episerer Account manager.

Postponement or second referendum

A postponement of Article 50 is thought to only soften Brexit even further, as it would leave the UK tied to the EU for longer, cost it more, and weaken its bargaining position, although if this is to happen, we will all know very soon. A second referendum or “Peoples Vote,” now seems less likely, even though the government opposition Labour Party has now come out in favor of it, and would take many months to put in place, essentially creating yet another postponement, and even the questions it may ask are frankly anyone’s guess. As both of these options leave little clarity as to what will actually happen, we believe such choices would ultimately require Episerver, its customers, partners, vendors and employees to plan for one of the three previously outlined outcomes.   

Other considerations

With any planning or critical thought on Brexit, our employees, customers and partners are at the forefront of matters. Episerver’s origins started within the EU, and we have employees that work and their families who live in many EU countries, including the UK. We have customers and partners, and their employees who have built their careers and lives there, and we have consistently advocated to any institution whom will listen to us, and provide our EU employees planning on their “right to remain” in the UK post-Brexit and for UK employees to remain in the rest of the EU.

Our customers and partners have successful businesses that rely on the Episerver Digital Experience Cloud platform, which requires the frictionless flow of data across borders in order to operate effectively. We acknowledge and have consistently advocated to the government the need to ensure this data flow continues post-Brexit.

The latest iteration of Teresa May’s proposed agreement would preserve the rights of our EU and UK citizen employees and their families currently based in the EU and UK to remain where they live and work. The proposed agreement also protects our customers and partners by helping to ensure the free flow of data across borders. Leaving the EU with no deal would create significant uncertainty with respect to these two priorities, but we will continue to work to be prepared for any eventuality. Episerver, its customers, partners and employees need a workable deal, and acknowledge that a “no deal” outcome would, regardless of the level of planning or options we provide, have some impact to existing EU/UK based customers and likely costs associated with such an outcome.

Whichever way you lean on the debate, from a purely business standpoint, according to Microsoft’s UK Chief Executive, Cindy Rose “the proposed agreement is both a necessary compromise and workable, leaving without a deal is neither.”

We also believe that customers that have previously opted for a licensed version of Episerver software, or use of their own hosting providers, should plan internally to see what effects that the UK, should withdrawal actually happen, will have on their own systems and platforms. Migrating to the Episerver Digital Experience Cloud backed by Microsoft Azure is one mitigation path we highly advise to customers as part of future planning of legal and regulation changes to come.

It was to overcome challenges posed by matters such as Brexit and GDPR that Microsoft opened data centers within the UK several years ago now, allowing concerned customers to know that their data would be stored within the boundaries of UK laws, while maintaining the same level of protection of any other Azure location.

Correspondingly, TechMarketView recently reported that 50% of the UK enterprise software market will be Software as a Service (SaaS) by 2021, double what it is today, and Episerver customer buying habits suggest it will be higher even than that, making the cloud one of the only certainties in an uncertain post-Brexit world. Enabling a platform as extensible, flexible and secure as the Episerver Digital Experience Cloud backed by ISO27001 certification and the Microsoft Azure cloud gives us all an advantage in adapting quickly, efficiently and effectively.

Regardless of the eventual outcome of Brexit, Episerver stands by its customers, partners, vendors and employees to plan for any eventuality and will work tirelessly to ensure as smooth a transition as possible.