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The Future Lawyer Weekly Update – w/c 24th April 2017

The Future Lawyer Weekly Update – w/c 24th April 2017

Your round-up of the stories that you should discuss at interview this week.

Commercial Law

The Impact of the snap Election on Financial Markets

Reported by Sylvester Gabriel Tan

Britain’s Prime Minister, in a surprise move, has triggered a national election due for early June and that has the potential to have a big impact on markets.

In the immediate aftermath of Britain’s vote to leave the European Union (EU) last year, Prime Minister David Cameron resigned and was soon replaced by Theresa May. Since then, May has formally begun the process of leaving the EU, but she has done so with her party having only a wafer-thin majority in Parliament. Current polls suggest that the Conservative Party, which she leads, would gain a larger majority, and thus firmer political power, if an election were held today.

May said that “[at] this moment of enormous national significance, there should be unity in Westminster but instead there is division” and that “the country is coming together but Westminster is not”, blaming opposition parties for threats to stifle Brexit. She further added that she had changed her mind to hold an election “recently and reluctantly” but that her reason for doing so was because a united government “was the only way to guarantee certainty and stability for the years ahead”.

The prospect of a stronger parliamentary majority for May’s Conservative Party was greeted positively by currency traders, with Deutsche Bank and Goldman Sachs, generally among the more bearish analysts of the pound/dollar trade, both moving their forecasts higher.

Derek Halpenny, European Head of Global Markets Research Mitubishi UFJ Financial Group, shared that the resounding victory for the Conservatives predicted in almost all polls, with more than a 20-point lead over Labour, would lessen the influence of the right wing of her party, which makes a “pragmatic approach through Brexit” more likely.

Peter Ashton, Managing Director at Eiger FX, also pointed out that that the markets were quick to price in greater economic and political stability under what they expect will be a significant majority given the weakness of the opposition. However, he cautioned that there is still huge uncertainty surrounding the implementation of Brexit. This view was shared by Mark Horgan, Chief Executive of Moneycorp, who observed that the election will prompt a rise in hedging as there is more “more uncertainty in a world of uncertainty.”

Upon the announcement of the snap election, the pound shot to a four-month high, jumping more than 1% against the US dollar, which suggests that the Prime Minister will be empowered to negotiate with the EU a better deal for the UK economy. For example, a larger majority in Parliament could diminish the power of the more extreme Brexiters, who favour limits on immigration over continued “free trade” with the EU (which is viewed to be very important to the UK economy).

A stronger currency often leads to weaker stock prices. Many British companies earn most of their income internationally, and thus that income is worth less in pound terms as the pound increases in value.

This partly explains why come announcement day, London’s blue chip stocks have seen their worst decline in two months in morning trading, falling more than 2% last Tuesday, as a stronger pound and sharply lowered iron ore prices dragged on the FTSE 100, which fell by more than 1.8 per cent (last Tuesday after the Easter bank holiday), dropping to its lowest level since the end of February and saw only 10 of its constituent companies’ stocks rising in value.

Overall, the stock exchange has witnessed the highest value of shares traded in a single day after the financial crisis resulting from the EU referendum –  turnover throughout the UK standing at £6.3 bn according to the London Stock Exchange – after Prime Minister Theresa May announced the snap general election. We can predict that a newly elected, majority Tory government will make it harder for May’s political opponents to chip away at her authority during the Brexit negotiations and as such, she can secure better deals with the EU, ultimately increasing investor confidence for the UK economy.

However, the question remains whether the British Prime Minister’s strategy is a gamechanger in the Brexit negotiations or if it merely strengthens her hand on the steering wheel? Either way, it seems (optimistically) that the long, edgy path to leaving the EU will be smoothened out in the near future.

Read more in City AM.

Criminal Law

Why is victim-blaming still happening?

Reported by Megan Kearns

The latest footage of Adam Jackson within prison “boasting” about the crime he committed and how it was not his fault, or the crime was not that “bad,” portrays the idea that victim-blaming is still very much going on in 2017.

Jackson who has lost not only his job, but his career due to admitting two counts of grooming and sexual activity candidly speaks about his crimes and states he wishes that he’d raped the 15-year-old victim, because he was convicted for six years. This behaviour contradicts the way Jackson tried to portray himself during his trial at Bradford Crown Court as he apologised and said he felt “ashamed” of his behaviour. The year he has sent in prison has either changed his views on the matter or finally the truth came out of what Jackson actually thinks about the offences he was convicted of. Within the video, Adam Jackson concluded that nothing that happened was his fault, as he dismisses his crimes as “f**k all”.

Jackson continued the victim-blaming by stating that now due to this, he has only ended up in prison because he was famous, yet had he not been well-known, he would have got “off” with only a caution.

Once Jackson finished his rant on the victim-blaming, he then began complaining about women in general, stating men are the victims in rape cases and are constantly at risk of being falsely accused of rape, solely because women are “too drunk” to remember.

This represents that although it is now 2017, victim-blaming is still very much occurring, and it is not only in prisons that it seems to find a receptive audience.

Read more in The Guardian.

Employment Law

Brexit may lead to reduced employment protections

Reported by Radhika Morally

A recent survey has revealed that several UK financial firms are using Brexit to push forward with employment protection cuts for British workers; they are viewing it as an opportunity to implement what would otherwise be very unfavourable changes.

65% of the 43 firms surveyed want to see changed on discrimination and equal pay laws, whilst more than 70% want to abolish the provision which allows employees on long-term leave to roll over their holiday pay, described by Law firm GQ Employment Law as ‘a burden’ for the companies involved.

Almost one in three companies think that the amount employment tribunals can award people in discrimination and equal pay cases should be capped, since they believe employees have used the threat of uncapped damages for a discrimination claim to force and employer to come to a settlement.

On the whole, it could be said that employment law is one that many consider will remain mostly untouched by Brexit, with the key issues being the likes of business, the economy, immigration, security and defence.

Especially concerning trade; studies by the National Institute for Economic and Social Research have shown that leaving the single market could lead to a reduction in UK trade by 22%-30% with Europe in the long-term unless the current trade deal remains.

However, since sectors such as agriculture and food preparation and delivery rely heavily on EU workers, the employment sector is bound to see massive changes. The results of the UK financial firm survey therefore serves to reflect the changing world stage; the employment sector should not be overlooked.

Read more in The Independent and the BBC.

Technology

Video games to be a medal event at 2022 Asian Games

Reported by Ben Thatcher

The Olympic Council of Asia has announced that E-Sports will be included as a medal sport at the 2022 Asian games, held in China.  The Council and Alisports, the sports arm of Alibaba, a Chinese online retailing company, have announced a partnership to introduce the games to the competition. It has not yet been announced which specific video game titles will be involved in the games.

This represents the boldest step in the mainstream recognition of competitive video gaming. The Asian Games are the second largest sporting event after the Olympics, with the games themselves being recognised by the International Olympic Committee. Some have argued that as a result of this, it shows an indication that video games are coming closer to parity with traditional sports. The Council stated that it wanted to reflect “the rapid development and popularity of this new form of sports participation”.

E-Sports will also be introduced at the 2017 Asian Indoor and Martial Arts Games in Turkmenistan. Games here will involve Fifa 2017, a multiplayer online battle arena and real attack games. In addition, the 2018 Asian Games, which are held in Indonesia, will also involve a demonstration, with 2022 involving an official sporting programme.

Read more on the BBC, The Verge and in The Guardian.

Real Estate

The effect of the election on small businesses

Reported by Anna Flaherty

Following the recent changes to business rates, which affected small businesses most, the announcement of the snap election has given a further blow. Businesses recently had the revaluation of their properties, and as business rates are based on the value of commercial property, these businesses faced greater costs. For instance the value of some commercial properties increased by over 100%, showing how small businesses will particularly struggle to finance the new rates. Following pressure on the government, a relief package of £300 million was promised. However, the snap election has meant that this relief has been delayed until after the election result. Rather than only taking a few weeks to introduce the relief package, as previously anticipated, it may now take several months. As a result, we may perhaps see the closure of many more small businesses.

Read more in The Guardian.

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