Don’t give me Brexit problems, give me Brexit scenarios
At the moment I spend a considerable amount of my lawyering time answering questions concerning Brexit problems. My first question back to the company is: what are your Brexit scenarios? Did you make a plan to cover the scenarios and follow through?
Often the answer is “no, we don’t have a plan, because we don’t know what the Brexit will turn out to be.” If your company is stuck in this groove the good and bad news is that by now you have pretty much run out of options to take meaningful action to manage a no-deal Brexit, because that is scheduled for end March. Yes, next month. Pretty soon. Around the corner so to speak. 33 days from today. That’s really close.
In the mean time the UK is not a single step closer to accepting the separation package agreed with its negotiators in December last year, and things are getting more complicated with increased political fragmentation in the UK parliament. Other EU member states are explicitly warning the UK now that they have tossed the steering wheel out of the window and are flooring the accelerator with having delayed the vote about the Brexit package until 12 March:
So maybe you still think now that a no-deal Brexit is a scenario with a degree of possibility that is worth planning for. That’s fine. I’m also quite sure that there were at least some dinosaurs that did not think that this huge meteor in the sky merited any further attention.
Reality doesn’t care whether you sink or swim
Reality really doesn’t care about whether what is happening is fair or not. Nature is not a moral theatre. The interesting thing about reality is that it has a nasty habit of just moving along, whether you like it or not. Even if you don’t paint yourself in a corner, reality may move the paint steadily towards you leaving you increasingly out of options. That is precisely what I see happening with a lot of medical devices companies at the moment. They wait and see while the paint creeps towards them, reducing their options by the day – literally.
Maybe the company has a Regulatory Cassandra or two doing their Cassandra thing, but we all know how these things work – management is usually not that concerned about things that are more than three months in the future. Why would they be? “It’s only core business, so how can that be important to the company?” I often say to management that is adopting a wait and see strategy for the MDR, the IVDR and/or the Brexit. And then management is not so happy with me. The Brexit only started almost two years ago.
So what can you still do?
So what can you still do? It’s never too late to do something. You can at the very least look at the checklist that the EU provided more than a year ago for CE marked goods:
- Is my notified body in the UK without options to recertify in their EU27 counterpart? If so, then your certificates expire in case of a no deal Brexit and that has the consequence that you need new certificates, which you will need to get elsewhere.
- Do I have an importer in the UK? If so, imports may become an issue after the Brexit, because the importer is not importing into the EU anymore.
- Do I have an authorised representative in the UK? If so, move it to the EU27 because after the Brexit the AR is not in the EU anymore as required for an AR.
If the answer to any of these three questions is yes, action is required, unless of course you like moving all your chips to red or black and spinning the roulette hoping for a no Brexit. If you are the roulette type, read no further. If you are not, consider the following questions:
- Do I have bridging stock in the UK and in the EU? It may already be too late to ramp up production to produce bridging stock, but you can still move stuff around. Plan for the UK to recognise the CE mark post Brexit for at least some tome (which it announced it will do), but not necessarily the EU recognising CE marks of UK notified bodies post-Brexit. Emergency measures may be taken, but they also might not be taken. Maybe only for essential devices, which your device might not be. Also think about the other things that might happen that may make it harder to move stuff around between the UK and the EU, such as customs requirements. Even if you do not have bridging stock, see how much product you can place on the market in the EU27 before the hard Brexit that may invalidate your certificate. Placed on the market is the safe place to be.
- What is the lead time for putting alternative market access routes in place? In other words – how quickly can you obtain new CE marking in the EU27 for the devices CE marked by UK notified bodies? Do you have contacts with a notified body that can still effect a voluntary transfer before the end of next month (probably not)?
- Also, the Brexit may affect all kinds of activities you have in or with the UK, such as import, production, parts or raw materials suppliers. See for every conceivable notice here. Better make sure that you manage those dependencies too.
In the mean time the UK has published its new design for product marking that will replace the CE mark upon a no-deal Brexit: “CA UK”. This will replace the CE mark and will be the mark resulting from the UK applying legislation post-Brexit that will very much look like the MDR and the IVDR. Or maybe they will do something else – they are on their own and rumour has it that regulatory competition will be an important selling point for the UK post Brexit.
Re-labeling for EU27 notified bodies
The Commission published another notice on 1 February 2019 with Brexit Q&A for industrial products that confirms the above action points. But it also address the thorny question of relabelling of medical devices with the new notified body number (and don’t forget other relabel items such as authorised representative). Under heading D of the Q&A the Commission clarifies that there is no escaping relabelling when certificates are transferred to an EU27 notified body pre-Brexit (the certs are technically not transferred, because the new notified body issues new ones but anyway). Two important points:
- The transfer of certificates from a UK Notified Body to an EU-27 Notified Body needs to take place before the withdrawal date (in case of no-deal Brexit 29 March midnight CET), on the basis of a contractual arrangement between the manufacturer, the UK Notified Body, and the EU- 27 Notified Body.
- no need to change the Notified Body number for products already placed on the EU-27 market or manufactured before the transfer of certificate has taken place and not yet placed on the EU-27 market. However, products manufactured after the transfer of the certificate has taken place should be marked with the new EU-27 Notified Body number and it will not be possible to continue to use the UK Notified Body number until the end of the validity of the original certificate issued by it.
In practice it turns out that it rather depends on
- the EU27 notified body what transfer process they can offer, as not everybody’s competent authority is minded to allow their notified bodies to offer a swift transfer process, while some do. This difference in my view is kind of nuts, because we have the NBOG that is supposed to oversee consistency on this point. Apparently the NBOG competent authorities are not really aligned on this.
- the UK notified body transferring what they can agree to in terms of moving the certificates to the EU27 notified bodies. Some of the UK notified bodies are very hard to work with at the moment, which makes agreeing to a meaningful transfer kind of problematic.
If you are confused and angry with your UK notified body not picking up the phone or answering email anymore (it happens), or just being too busy to even schedule a necessary audit in time to save your certificate (happens too), you are running out of options. Your only meaningful option is to approach an EU27 notified body that is willing to work from its end to see what it can do with the unresponsive UK notified body. And hopefully the competent authorities will have some kind of plan in case it completely goes south on 29 March, but so far they have been keeping their cards close to their chests.
As I’ve said on more than one occasion, it would be so helpful if competent authorities would be more concerned with the quality of notified bodies administrative practice. Issuing and surveillance of medical devices certificates is delegated state authority and we seem all happy to allow notified bodies to apply a standard that we would never ever accept from a government agency, not even from tax authorities.