Brexit Trade and Investment News: AI, the Football Governance Bill and Belgium

Brexit and the Bletchley Declaration on Artificial Intelligence (AI)

 The Bletchley Declaration by the 29 participants (the EU + 28 sovereign states) attending the AI Safety Summit at Bletchley Park on 1-2 November 2023 was published at the outset of the Summit and focused on a number of issues , including “frontier AI” – “understood as being those highly capable general-purpose AI models, including foundation models, that could perform a variety of tasks – as well as relevant specific narrow AI that could exhibit capabilities that cause harm – which match or exceed the capabilities present in today’s most advanced models”.

The Declaration explained that “in the context of our cooperation, and to inform action at the national and international levels, our agenda for addressing frontier AI risk will focus on:

  • Identifying AI safety risks of shared concern, building a shared scientific and evidence-based understanding of these risks, and sustaining that understanding as capabilities continue to increase, in the context of a wider global approach to understanding the impact of AI in our societies.
  • Building respective risk-based policies across our countries to ensure safety in light of such risks, collaborating as appropriate while recognising our approaches may differ based on national circumstances and applicable legal frameworks. This includes , alongside increased transparency by private actors developing frontier AI capabilities, appropriate valuation metrics, tools for safety testing , and developing relevant public sector capability and sector research”.

On the second day of the Summit, the UK as the host nation announced that the Bletchley Park participants had agreed to support the development of an international, independent and inclusive “State of the Science” Report on the capabilities and risks of frontier AI.

The Bletchley Park participants have expressed a wish in their Declaration to meet again in 2024 to discuss AI safety and no doubt there will be much to discuss about the developments in AI that are likely to have occurred in the meantime.

Interestingly, shortly prior to the Bletchley Park AI Safety Summit , US President Joe Biden had signed an Executive Order on Safe, Secure and Trustworthy Artificial Intelligence which was shortly followed by the release of a draft policy on agency use of AI.

A lot of activity on the AI front!


Brexit and the UK’s Football Governance Bill

 The UK has a strong tradition of self-regulation in the sports sector and it, therefore, may seem somewhat strange that, in the King’s Speech 2023 delivered on 7th November 2023, the UK Government announced the introduction of the Football Governance Bill to regulate “the top five tiers” of the men’s English [and Welsh] “football pyramid”, including the Premier League. However, such is the importance of those five tiers to the UK economy and to UK sporting culture as a whole that the Bill’s announcement may not seem so strange after all.

The Background Notes to the Bill  explain that in the 2021-2022 season the Premier League’s aggregate revenue was £5.5 billion – compared to  Spain’s La Liga ( £2.8 billion) and Italy’s Serie A ( £2.1 billion).However the Background Notes continue that “this cannot disguise the underlying fragility of the English football pyramid. Fundamental problems of perverse incentives, poor governance, and defective industry self-regulation mean there is a high and growing risk of financial failure among clubs:

  • clubs are consistently loss making and rely on external funding, From 2010-11 to 2021-22, Championship clubs made collective pre-tax losses over £3 billion and they exceeded £1.7 billion in the last five seasons for which data is available ( 2017-18 to 2021-22);
  • even at Premier League -level, from the 1999-2000 season onwards, 19 out of 23 ( 83 per cent) Premier League seasons have resulted in pre-tax losses, highlighting that this is a persistent issue even for the highest earning clubs”.

The Background Notes also point out that “levels of borrowing and debt are increasing” and that “across the Premier League and Championship combined, net debt increased to £4.4 billion in 2022”.

This is the background to the Bill’s central proposal, namely, the introduction of an “Independent Football Regulator” who “ will help to promote and secure the financial sustainability of clubs and reduce the likelihood of financial collapse”. The Background Notes explain that the Regulator will operate a licensing system “where all clubs in the top five tiers of the men’s English [and Welsh] football pyramid will need a licence to operate as professional football clubs. The Regulator will have powers to monitor and enforce compliance with requirements in financial regulation; corporate governance; club ownership ( Owners’ and Directors’ tests); fan engagement and club heritage protection; and approved competitions”.

In summary, the Background Notes highlight the following bullet point objectives of the Bill:

  • “Establishing a new independent regulator for English football clubs to address issues of financial stability and ensure fans’ voices are listened to”;
  • “Creating a new, strengthened owners’ and directors’ tests to make sure a club’s custodians – their owners and directors – are suitable”;
  • “Setting a minimum standard of fan engagement, which clubs will need to meet, and requiring the support of a majority of fans for any changes to the club’s badge, name, home shirt colours”;
  • “Requiring clubs to seek the Regulator’s approval for any sale or relocation of the stadium and demonstrate how they have consulted their fans as part of this”;
  • “Preventing clubs from joining breakaway or unlicensed leagues”;
  • “Intervening as a last resort to ensure financial sustainability through the redistribution of broadcast revenue”; and
  • “Establishing a compulsory “Football Club Corporate Governance Code””.

An apparent sea-change in football regulation in the post-Brexit era!

Brexit and Belgium

Belgium is one of the UK’s closest trading partners and also one of its closest geographical neighbours.

How are trade and investment developing between the two countries following Brexit?

According to figures published by the UK’s Department for Business & Trade (“DBT”) on 17th November 2023, total trade in goods and services ( exports plus imports) between the UK and Belgium was £57.8 billion in the four quarters to the end of Quarter 2 (Q2) 2023, an increase of 10.4% or £5.4 billion in current prices from the four quarters to the end of Q2 2022. Of this £57.8 billion:

  • Total UK exports to Belgium amounted to £25.5 billion in the four quarters to the end of Q2 2023 ( an increase of 11.9% or £2.7 billion in current prices, compared to the four quarters to the end of Q2 2022); and
  • Total UK imports from Belgium amounted to £32.3 billion in the four quarters to the end of Q2 2023 ( an increase of 9.2% or £2.7 billion in current prices, compared to the four quarters to the end of Q2 2022).

The figures also showed that Belgium was the UK’s 9th largest trading partner in the four quarters to the end of Q2 2023, accounting for 3.2% of total UK trade.

According to the figures, in 2021 the outward stock of foreign direct investment (FDI) from the UK in Belgium was £28.2 billion , accounting for 1.6% of the total UK outward FDI stock, and, in the same year, the inward stock of FDI in the UK from Belgium was £88.8 billion , accounting for 4.4% of the total UK inward FDI stock.

Encouraging figures in a cold climate!