The technology, media and telecoms sector spans a wide variety of firms with different degrees of exposure to Brexit, and any overview of the implications of Brexit is therefore necessarily selective. We have identified three main impacts that could be substantial.
‘Country of origin’ principle in audiovisual and media services
Under the ‘country of origin’ principle codified in the EU Audiovisual Media Services (AVMS) Directive, TV channels originating in any EU member state can be distributed throughout the EU provided that they are regulated in their originating country.
This, together with other factors (such as the UK’s large talent pool in the broadcasting sector), has attracted a large number of organisations to the UK as a base for TV channels targeted at other European countries. Under a Brexit scenario in which the UK remains within the EEA, we expect that the AVMS would continue to apply in the UK, and we would not expect an impact related to the ‘country of origin’ principle. By contrast, under a WTO-type Brexit scenario, we would expect that the channels mentioned above would no longer be protected by the ‘country of origin’ principle and might accordingly either seek compliance in their receiving countries, leaving their bases in the UK, or possibly seek to relocate their legal base, whether or not their physical operations are shifted. Over time, however, the case for their remaining in the UK would be undermined, making them likely to relocate to other EU jurisdictions.
International data transfers of personal data
Within the EU, existing rules place significant legal hurdles on firms wishing to transfer data to countries outside the EU, while making intra-EU transfers relatively straightforward. In terms of international data transfers, under a WTO-type Brexit scenario, unless an adequacy decision can be secured, we would expect UK firms in sectors across the economy
to face challenges in transferring EU citizens’ data to UK offices or data centres. Accordingly, we would expect the UK to attach high priority to securing such an arrangement. However, given current
tensions between UK and European law on data protection matters, it is difficult to forecast future policy divergence.
Moreover, even if an adequacy decision is achieved, data transfers to the UK might be still be reduced in a Brexit scenario, as compliance, contractual or marketing considerations might prevent some firms from transferring data to the UK. We would expect that:
Rules on mobile roaming rates
UK-based cloud firms will see a drop in their EU revenues;
multinational firms in sectors across the economy will face challenges in transferring EU citizens’ data to UK offices or data centres.
In recent years, EU rules on mobile roaming have ensured that consumers pay less to use their mobile devices outside their home country. We estimate that if UK operators were no longer subject to EU roaming regulations, they might stand to benefit by as much as £160m per year (largely at the expense of UK consumers, who would pay more for less usage when roaming in the EU). Had the UK voted to stay in the EU, operators might have stood to lose revenues in the order of £400m per year as a result of planned EU measures that will take effect in the coming years.
Oxera has submitted evidence to the House of Lords inquiry on trade in services post Brexit, and specifically on the question of roaming and the impact of Brexit on the UK telecoms market.
 These tensions relate to surveillance of personal data by official bodies—an issue that has recently also put into question the European Commission’s adequacy decision with respect to the USA. For more on the UK/EU difficulties, see The Conversation (2016), ‘How would Brexit affect data protection, privacy and surveillance laws in Britain?’, 5 May, http://theconversation.com/how-would-brexit-affect-data-protection-privacy-and-surveillance-laws-in-britain-57995. For more on the EU/USA difficulties, see European Court of Justice (2015), ‘The Court of Justice declares that the Commission’s US Safe Harbour Decision is invalid’, 6 October, http://curia.europa.eu/jcms/upload/docs/application/pdf/2015-10/cp150117en.pdf. See also The Guardian (2016), ‘Data regulators reject EU-US Privacy Shield safe harbour deal’, 14 April, https://www.theguardian.com/technology/2016/apr/14/data-regulators-reject-eu-us-privacy-shield-safe-harbour-deal.