No-deal Brexit would put ‘6,000 jobs in Austria in danger’

While the car hub region of Styria hopes to maintain long-term relations with the UK, thousands of jobs could be threatened and Austrian financial institutions could suffer if the UK departs the EU without a deal on March 29th.

No-deal Brexit would put '6,000 jobs in Austria in danger'
Photo: ivosar/Depositphotos

A February 2019 report by the German think tank the Leibniz Institute highlights which countries and which industries will be most affected in 43 countries. The report also named Austria as particularly exposed in certain sectors. 

“The study showed that 6,000 jobs in Austria could be in danger in case of a no-deal Brexit,” Dr Barbara Kolm, director at think tank the Austrian Economics Center, told The Local – citing a February 2019 report by the Leibniz Institute for Economic Research Halle (IWH) and the Martin Luther University Halle-Wittenberg, both in Germany.

“In Austria and Belgium, wholesale and retail trade show the strongest exposure,” states the Leibniz Institute report

“Austria is a country which will be affected by Brexit more indirectly through trade with Germany and other countries closely connected to Britain than directly,” adds Kolm.

A report by the government in Styria, Austria's car hub, confirms Austria's exposure to Brexit through trade with its neighbours.

“An estimated €343 million in goods (exports from Styria) are also potentially threatened indirectly via the three main trading partners Germany, Italy and the USA. This corresponds in total to approx. 5.5% of total Styrian goods trade,” states a risk analysis by the Styrian regional government. 

Austria is ultimately more insulated to a no-deal than many of its neighbouring countries, as Kolm points out. The Leibniz Institute report suggests more than 100,000 jobs could be at stake in Germany if the no-deal fears become reality in 35 days. 

READ ALSO: No-deal Brexit could cost Germany 100,000 jobs, according to study

Kolm says Austrian banks could nevertheless suffer. 

“Austrian banks could be affected by a possible partial move of London’s financial sector to Frankfurt or Paris,” says Kolm. “Tourism – and thus, airlines, are another sector which could take a hit,” she adds.

READ ALSO: Frankfurt confident it is the big Brexit-relocation winner: Special report

Easyjet announced last year that it was setting up an Austrian subsidiary to circumnavigate any Brexit aviation complications.

As of January 2019, Easyjet had already transferred 130 Airbus aircraft to its subsidiary in Austria. The licenses of the crews are also expected to be transferred to the Austrian subsidiary before March 29th, reports German-language daily daily Tagesschau. 

Britain's Prime Minister Theresa May greets Austria's Chancellor Sebastian Kurz outside of 10 Downing Street in central London on November 22nd, 2018. Photo: Ben Stansall/AFP. 

While a no-deal represents a challenge to Austria, the country has a trade surplus with the UK and more than 100 Austrian companies are nevertheless active in the UK market – “among them Novomatic, Wienerberger, and Zumtobel,” adds Kolm.

Alpine states such as Salzburg, where tourism is a key industry, could feel a heavier Brexit burden. Nearly one million Brits, mainly winter ski tourists, visit Austria each year.

One of the strongest trade relationships with the UK is in the car manufacturing sector, which in Austria is nestled around the city of Graz in the region of Styria. 

The United Kingdom is Styria's 4th largest export partner. Just over 4 per cent of all exports from the region are destined for the UK, according to a report by the Styria regional government. 

“While there is fear that there could be a downturn after Brexit, Styria still sees Britain as a main trading partner in the long-term,” Kolm told The Local. “Styria, the state of which Graz is the capital city, has a multitude of trade connections with the UK. In total, exports to Britain just from Styria totaled €875 million in 2018.” 

READ ALSO: Swiss auto with Austrian brain turns heads

Nevertheless, the Styrian government says that potential tariffs and higher export costs will “have an immediate impact on the Styrian economy.” An additional €239 million in Styrian service exports are also highlighted as vulnerable in the regional government's report on Brexit's impact on local trade. A no-deal exit would only compound fears and add to uncertainty for businesses. 

Austrian Chancellor Sebastian Kurz recently insisted avoiding a hard Brexit is still a viable priority.

“The main target is to avoid a hard Brexit. If we need more time to reach that, then we should consider that option,” Kurz said, according to Reuters. 

Regardless of the outcome of Brexit, the 10,000 or so Brits living in Austria will have been relieved to hear that Austria has passed legislation to protect their rights in the event of a no-deal. More details here

READ MORE: Styrian dream or stygian nightmare? Austria's Brexit car roulette



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Is new court ruling the end for Britons fighting to remain EU citizens?

The Court of Justice of the European Union confirmed on Thursday that Brexit really does mean that Britons are no longer EU citizens. Claudia Delpero looks at whether there's any other way they can keep their rights.

Is new court ruling the end for Britons fighting to remain EU citizens?

The Court of Justice of the European Union confirmed on Thursday that Britons lost EU citizenship when the UK left the EU, on 1st February 2020. 

It is the first time the EU’s top court has rules on the matter, after a number of legal cases challenged this specific Brexit outcome. The decision also sets a precedent should other countries decide to leave the bloc in the future. 

What has the EU Court decided?

The Court of Justice decided on a case brought by a British woman living in France.

Before Brexit, she could vote and stand as a candidate in her town of residence, Thoux. But after the UK withdrawal from the EU, she was removed from the electoral roll and excluded from the municipal elections that took place in March 2020, during the transition period.  

As the mayor refused her appeal to restore the registration, she took the case to the regional court in Auch, which agreed to request an interpretation of the rules to the EU top court. 

Julien Fouchet, the barrister supporting her and several other cases on the EU citizenship of British nationals, argued that the loss of EU citizenship and voting rights was disproportionate. It would also be contrary to the EU Charter of Fundamental Rights, given that the woman also lost her voting rights in the UK, having lived abroad for more than 15 years.

Alice Bouillez, who has lived in France since 1984 and is married to a French national, could have applied for French citizenship, but did not do so because she said “this was not necessary” before Brexit and, as a former UK official, she had taken an oath of allegiance to the Queen.

On Thursday the Court of Justice announced the decision about her case. The court ruled that the “possession of the nationality of a member state is an essential condition for a person to be able to acquire and retain the status of citizen of the Union and to benefit fully from the rights attaching to that status.”

The court therefore confirmed that British nationals automatically lost their EU citizenship as a result of Brexit and, as a consequence, Britons also lost their voting and electoral rights in municipal elections in the EU (unless the country where they live set different rules). 

What is EU citizenship?

EU citizenship was introduced by the Treaty of Maastricht of 1992, when borders were opening and the bloc was integrating economically after the end of the Cold War. 

Under the treaty, every person holding the nationality of an EU member state is a citizen of the Union. EU citizenship is additional and does not replace nationality, the treaty specifies. But this creates the first form of a transnational citizenship that grants rights across borders.

EU citizens have the right to access each other’s territory, job market and services under the principle of non-discrimination. If they are economically active, they have the right to reside in other EU states and be joined by family members, access healthcare at the same conditions of nationals (for emergency treatment also when travelling temporarily), obtain social security benefits and see their professional qualifications recognised.

Beyond free movement, at the core of EU citizenship there are also political rights, such as participating in the European Parliament election, voting and standing as candidates in municipal elections when living in other EU countries, receiving consular protection from other EU states outside the EU, and taking part in European Citizens’ Initiatives asking to the EU to legislate on certain matters. 

Which EU citizenship rights have Britons lost with Brexit? 

For British citizens who were living in the EU before Brexit, the Withdrawal Agreement protects some of these rights. Britons covered by deal have their residence, access to work and education, healthcare, social security and qualifications secured, but only in the country where they were living before Brexit.

But the right to free movement in other EU states, consular protection in third countries, and the political rights attached to EU citizenship were lost, the Court confirmed. 

For British citizens in the UK, the trade and cooperation agreement has preserved some social security rights and, in theory, the possibility to have professional qualifications recognized when moving to an EU country. These provisions however lack details and may take a long time before they work in practice. 

As the “European Union” no longer features on British passports, the possibility to access EU lanes at airports to skip passport control queues has also vanished. 

“The loss of those treasured rights has been clear to those of us living in the EU from the early days of Brexit. But for Brits in the UK, the realities of life outside the EU, and the consequences of Brexit, are only just dawning. Long queues at the borders, roaming charges, obstacles to working abroad, etc. are the new reality,” said Sue Wilson, Chair of the group Remain in Spain. 

While she said the court’s decision was “no real surprise,” she argued that “this is not the Brexit the public were promised, or that the majority voted for.”

Can British citizens get some of these rights back?

Julien Fouchet was disappointed at the Court decision and promised to continue the legal fight, bringing the case at the European Court of Human Rights (which is not an EU institution). 

Other two cases on the matter of EU citizenship for British nationals are still pending at the Court of Justice of the EU. One of them aims to determine whether EU citizenship is a “fundamental status” that cannot be removed but Thursday’s decision could have already provided the answer.

Another option to reconsider some of the rights is the renegotiation of EU-UK trade agreement, when it will be reviewed in 2025. 

Meanwhile, the EU is revising the rules for non-EU citizens living in EU countries on a long-term basis, making it easier to move across borders. 

Applying for citizenship is so far the only option to regain voting rights, although not all EU countries allow dual nationality. 

Sue Wilson, who has long campaigned for the UK to stay in the EU, said: “There is only one way to restore the loss of our rights, and that’s to rejoin the single market, rejoin the customs union, and eventually, rejoin the European Union… Until that day, we will continue to be second class citizens whose rights have been diminished for the sake of an ideology.”