Issue Impact
Change of law risk; impact on M&A Change of law in itself is unlikely to be a significant factor in most M&A deals, and parties are unlikely to allocate this risk expressly, but Brexit could well affect deal appetite and pricing, particularly if a 'hard' Brexit appears likely. Buyers may seek warranties from sellers that the target's business will not be materially adversely affected. 
Due diligence / integration issues Increased due diligence, including in relation to steps taken by the target company to prepare for Brexit (especially a 'hard' Brexit) and to mitigate any adverse consequences; more careful planning for post-deal integration, particularly where supply chain, workforce or ability to obtain licences and authorisations may be disrupted as a result of a 'hard' Brexit.
Loss of transactional tools A number of cross-border M&A mechanisms (e.g. cross-border mergers, insurance business transfers and entity structures such as the Société Européene and EEIG) rely on European regulations and/or mutual recognition which may no longer apply.
Tax planning and structuring Common EU rules, e.g. on VAT, may no longer apply.
Merger control filings The EU operates a 'one-stop-shop' merger control regime for transactions that would otherwise have to be notified for clearance in a number of individual EU or EEA countries. Depending on the nature of the UK's trading relationship with the EU post-Brexit, the UK would no longer be a jurisdiction within that one-stop-shop. This would be likely to mean more transactions being notified and investigated by the UK's Competition and Markets Authority (CMA).
Competition compliance and investigations The substantive rules on anti-trust are likely to remain unchanged post-Brexit, meaning that very few changes would be required to compliance policies. The main impact will be on investigations as Brexit will mean certain institutional and procedural changes to enforcement (e.g, to leniency applications and the conduct of cartel investigations).
State aid State aid rules are intended to ensure a level playing field for business within the Single Market. EEA countries are bound by the same rules as EU Member States. In principle, Brexit would allow the government greater freedom to subsidise businesses and otherwise award 'aid' measures, but in practice the UK is expected to continue to apply existing state aid rules broadly unchanged.
Your Contacts
Corporate Competition
Chris Southorn

Chris Southorn

Partner

T +44 (0‌)20 7367 3603

E christopher.southorn@cms-cmno.com

Graeme Young

Graeme Young

Partner

T +4‌4 (0‌)20 7‌367 2906

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Tax Corporate
Aaron Fairhurst

Aaron Fairhurst

Partner

T +44 (0‌)20 7367 2863

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Kristy Duane

Kristy Duane

Partner

T +44 (0‌)20 7524 6568

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