The UK’s exit from the European Union could have unforeseen ramifications across the legal market. As part of The Lawyer’s upcoming Corporate Offshore report (out late April), we asked leading firms offshore for their reactions and predictions. What will be the immediate effect on Crown Dependencies? What might happen to capital flows? Are firms cautious or bullish? Read on..

Hassans: Even prior to Brexit, we have had to begin to adapt and will have to continue to adapt to external pressures mostly from EU/OECD that are having a profound effect on work related mostly to corporate clients (e.g. GAAR restrictions affecting application of Parent Subsidiary Directive, Anti Tax Avoidance Directive, EU State Aid considerations and OECD BEPS initiatives). Brexit considerations will no doubt add a further significant dimension to the adaptation of our provision of services to our corporate clients.

Mourant Ozannes: We are bullish about the impact of Brexit for our corporate practice over the medium to long term. We don’t expect an adverse impact at all on deals originating in North America and Asia, our fastest growing markets. Post-Brexit, the Crown Dependencies and Overseas Territories will have an important role to play, as part of the British family, in ensuring the UK remains competitive and capitalises on new-found opportunities.

Carey Olsen: We certainly saw the aftermath of Brexit in terms of shock and, to an extent, stagnation: there were various transactions that were put on hold until parties had time to reflect and tried to see which way things were going. But that was surprisingly short-lived. Despite the uncertainty, the move in the currency (sterling’s depreciation) has contributed to people viewing Brexit as an opportunity to ensure continued deal-flow and, in our view, the fundamentals in various market sectors and the availability of private equity funding ready to be deployed means that we will continue to see good levels of M&A activity in the medium-term.

Collas Crill: Historically, the EU (other than the UK) has not been a major user of structures based in our core jurisdictions, EU countries tending to use ‘midshore’ centres – countries closer to home such as Ireland/ Luxembourg/Netherlands, so we would not anticipate the direct effect on corporate work to be particularly negative.

If anything the effect may be net positive as the UK both politically and from a business perspective is likely to develop its relationship its crown dependencies and overseas territories which many of the UK’s international business partners (including those in North America) are familiar with.

Appleby: Like other offshore law firms, Appleby could benefit from being a step removed from the impact of Brexit. For example, the Crown Dependencies are not EU member states and have always had ‘third country’ status, so a lot of the rule changes that will affect the UK should be ‘business as usual’ for Jersey, Guernsey and the Isle of Man. That said, we are acutely aware that any impact on deal flow for onshore firms will have a direct impact on offshore firms.

Jersey and Guernsey trusts, unit trusts and holding companies have been used extensively to own real estate in the UK. They remain prime jurisdictions in which to establish property holding structures for commercial investment. The weak pound combined with the economic resilience of the UK following the referendum has resulted in increased international investment in UK real estate and we see this continuing for those investors with a long term investment horizon.

Maples & Calder: The potential for uncertainty over Brexit to cause a slowdown in activity in the UK and the rest of Europe is of course a matter for concern but Cayman and BVI should be well-positioned given that their footprint is essentially global, compared, say, to the Channel Islands, which have a much higher concentration of business within the UK and so may have greater exposure to any potential slowdown in activity there.

Cayman and BVI facilitate inward investment into the EU – as recently highlighted when the Italian government placed Cayman on its “whitelist” in order to encourage Cayman-based funds to provide much-needed investment capital and liquidity to fund their real estate and other asset classes, at a time when their domestic banking industry faces challenges. Secondly, these structures also provide a neutral platform to allow EU businesses to attract and service global clients and customers and help them to compete competitively with international businesses, which in turn drives job-creation and taxable revenues in the EU.

Forbes Hare: Brexit will likely result in uncertainty in the UK market and this uncertainty coupled with the continued weakness in sterling may force UK corporations to look to new regions for greater exposure to different economic, market and consumer dynamics. England will be forced to look for new trading partners and as a result, cross border M&A’s may provide an important source of value creation for UK companies in 2017.

Read more from The Lawyer‘ Brexit experts here.