James Sage, Partner and Head of Corporate – FBC Manby Bowdler
Brexit might be done, but there is still plenty for businesses to do to ensure they are on top of the country’s new trading arrangements, says James Sage, the lead partner in FBC Manby Bowdler’s corporate department.
It’s taken more than four years, but after all the talk, all the arguments and all the political cat and mouse games, Brexit is finally done.
But for businesses the length and breadth of the country that does not mean the hard work to prepare for a new trading regime is done.
In fact, far from it.
The immediate impact of the change in the UK’s trading status is only just beginning to be felt. The last-minute deal which guaranteed zero tariffs and no quotas was certainly a huge relief for much of the business community, but the plethora of new rules and regulations which came with it will keep us all on our toes.
In truth, there are few businesses who will not be impacted by the changes.
If, for example, you employ migrant labour, there is a whole new points-based immigration policy to deal with which applies to EU citizens just like the rest of the world.
As a result, anyone you want to recruit from outside the UK, excluding Irish citizens, needs to meet certain requirements and apply for permission first – and you will need to have a sponsor licence to hire most of them.
Those EU workers already living here will need to have gained Settled Status or Pre-Settled Status by the end of June to retain their automatic right to live and work here, otherwise your company could face a drain of talent come the summer.
This is just one area of change, of course.
There are a number of wider marketplace and commercial issues which are starting to become apparent. The cost and availability of goods and services may alter significantly in the next few months as the impact on greater checks and paperwork at Customs starts to be felt.
Businesses must apply for an Economic Operator Registration and Identification Number (EORI) to continue trading with the EU and demonstrate that the products they are moving originated either here in the UK or in the EU itself to avoid tariffs. Even then, it is possible that custom duty charges may be applied under certain circumstances.
Supply chains face significant potential disruption with added red tape and checks at borders – and the new country of origin rules could be a particular area of friction unless companies do their homework speedily. Contracts, for example, may well need an overhaul to take light of the new arrangements and the fact that the UK is no longer an EU member, as it would have been when a good many of them were drawn up.
It is also likely that you will need to take action to ensure your Intellectual Property remains sufficiently protected and consider how you might settle any new disputes with suppliers in both the EU and beyond.
You’ll also need to consider some of the tax implications of the new trading regime. Whilst the UK continues to levy VAT and the rules regarding domestic transactions are unchanged, there are amendments to the VAT rules and procedures involving trade between the EU and UK to factor into your business plan.
These are just a few examples of the new world of work we are all doing business in. If you have not already done so, it really is essential that you conduct a Brexit audit of your business to see what changes you need to be making to continue trading as efficiently as possible – and ask for expert legal help where appropriate to ensure you have covered all your bases.
And don’t forget that Brexit will also bring new opportunities.
The UK is signing new trade deals all over the world and fresh overseas markets are opening up on an almost daily basis. Despite the challenges, there are new deals to be made and new contracts to win.
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