Saturday 29 September marked six-months until the UK leaves the European Union. There is now less than 6-months to go until the UK leaves the European Union and there remains no clarity on what will happen and that uncertainty is set to remain. Whilst a deal of some description may remain the most likely outcome, the prospect of a hard Brexit continues to rise and business has a diminishing window to make preparations and minimise the risk.
Both the UK and EU negotiators are aiming for a deal by November on the terms of the UK's departure from the EU and the shape of their future trading relationship. However, both sides remain far apart, the tone of negotiations are not positive and, even if the UK and EU negotiators settle on the terms of their agreement it remains far from clear that the Prime Minister will secure the support of Parliament. Any absolute clarity is only likely to emerge in early 2019.
In the event of a hard Brexit then absent any further agreement the UK will trade with the EU on the terms set out in the WTO and other relevant international treaties that govern the trade in goods and services. The UK Government has published a series of papers highlighting the potential impact of a hard Brexit across all sectors and affecting all business. They provide a starting point, but often belie the complexity of issues for business to consider and the time and cost involved in addressing these issues. Whilst the 'no deal' papers set out what the UK Government intends to do to mitigate the effects of a hard Brexit on companies based in or trading with the UK, they cannot set out the position the EU will take and which all companies must be prepared for.
In the event that the UK and EU do negotiate an orderly Brexit in March 2019, both sides have committed to establishing a new trading relationship to take effect from January 2021.
In both scenarios the trade in goods and services between the UK and the EU will change significantly, potentially affecting all areas of business operations including the employment of staff; the transfer of goods and services across borders; the tariffs to be paid; the contracts that are in place; the supply chains and manufacturing of goods; the gathering and exchange of data; the seat of a company; the registration of IP; and the sourcing of research and development funds.
Fieldfisher has published – and will continue to publish – a series of insights into the process as a whole as well as how companies can seek to mitigate the challenges and take the opportunities that Brexit may have in a number of these key areas. Fieldfisher's Brexit team has also produced a 'Brexit Checklist' and a 'Board Support' paper designed to assist your organisation in its planning – please contact us on Brexit@fieldfisher.com or through your Fieldfisher contact for a copy.