Helping you achieve your aims in a post-Brexit world.
From 1 January 2021, the relationship between the UK and the EU is governed by the Trade and Cooperation Agreement (TCA), following the end of the Brexit transition period on 31 December. While the deal is a more favourable option than a ‘no deal’ scenario, which would have put UK-EU trading on World Trade Organisation (WTO) rules, leaving the EU single market will still impact businesses in a number of ways:
- Impact on exports: Although the UK has secured tariff-free trade with its EU neighbours, this only applies to ‘originating’ products i.e. products that originate either from the UK or the EU, proving problematic for businesses with complex supply chains. Even when goods meet the ‘rules of origin’ criteria, customers and businesses may still be liable for custom duty charges and unexpected red tape.
- Impact on supply chain: With all imports now subject to customs formalities at borders, including additional safety checks and decelerations, disruptions to the flow of goods and services between the UK and the EU will continue for some time. Some businesses prepared for this scenario by stockpiling goods during the Brexit transition period, however, most will need to review their strategies and supplier relationships to continue to operate profitably.
- Impact on customers. Even if your supply chain and customer base exist in the UK, Brexit is expected to contribute to a loss of GDP in the foreseeable future, which will be felt by the UK consumer. However, Brexit can also be an opportunity to expand your customer base to emerging markets where consumer spending is on the rise. International (non-EU) sales from the UK rose considerably in 2020 and are expected to continue to rise as a result.
- Impact on workforce. The freedom of movement between the UK and EU ended on 1 January 2021. Under new immigration laws, EU migrants are subject to a points-based system for visa eligibility. Employers who rely on EU migrants need to obtain sponsorship licences and offer roles to individuals prior to their arrival in the UK. This will contribute to workforce shortages for many businesses until they adapt their recruitment strategies for a post-Brexit world.
At Brabners we work closely with businesses across all the key sectors of the UK economy – from retail and supply chain to real estate and technology – and understand the challenges they face.
Whether your current focus is on navigating the short-term disruptions posed by Brexit or adapting your business strategy to take advantage of new opportunities, we can help you achieve your goals.
To speak to our experienced legal team, call us on 0333 043 3230 or email us on law@brabners.com.
