Combating both a No-deal Brexit and Coronavirus restrictions - How to Keep Ahead
UK Businesses are well aware that they are facing the double challenge of Brexit and coronavirus whilst standing on the shifting sands of the ever-changing government stances relating to the twin perils with the consequential effect on their ability to do business. Agility is the key to survival when even sound contingency plans are derailed unexpectedly. Only businesses that are fast on their feet and establish variable contingency plans are likely to get through without any major risks to survival, providing their industry sector is not one that has its hands tied due to the nature of its category. The stop/go coronavirus rules imposed together with the brinkmanship Brexit strategy make it almost impossible for the majority of businesses to find a guaranteed way of planning for the future whilst attempting to find a way of doing business facing the challenges in the immediate future.
The prime minister’s statement suggesting that the country should expect to face a no-deal Brexit and look towards a trade deal similar to that Australia has with Europe provides less than three months preparation, if this possibility becomes a reality. The response from commentators generally has been that the statement may be an attempt to focus the minds of the EU negotiators and demonstrate that Britain will not blink first. However, it also may not.
The Institute of Directors (IoD) recent report revealed that only approximately one-fifth of British businesses felt that they were actually ready for the end of the Brexit transition period. The relatively sudden arrival of coronavirus and prolonged consequences to businesses across the globe has left business owners facing the consequences of the measures taken in response to the pandemic with little time to plan the steps to the changing scenario of Brexit.
The strong potential for a no-deal Brexit which would result in the UK trading on World Trade Organisation terms, with significant tariffs on many goods imported and exported with its former European Union trade partners will almost certainly result in the collapse or near collapse of many cross-border businesses at present wrestling with the effects of the diminished trade due to the coronavirus pandemic.
Giambrone’s corporate and commercial team has a strong cross-border element in the shape of Italian and Spanish commercial lawyers based in the London office regularly working in tandem with English speaking commercial lawyers in the Milan and Barcelona offices.
Vincenzo Senatore, a partner who works between London and Milan, said “business owners must work to find the best model for them. Re-negotiating their contracts and deals with their trading partners in light of the prospect of trading under the Australian model. Also, reducing the overheads is crucial.” He further commented “it is in everybody’s interests to keep trading and time is of the essence. Our commercial teams are well placed to advise and assist in any negotiations.”
Giambrone’s lawyers recommend focussing on the key factors:
- Trading partners’ contracts
- Distribution of goods
- Brand – Intellectual Property
The government has provided guidance as to hauliers that is currently being updated. Businesses using hauliers to deliver their goods would be well advised to ensure that they hold the required licences and permits; ensure that their drivers themselves are allowed to drive in the countries applicable to your business needs and that all the correct export documentation is held by your driver before making a journey. It is a wise precaution to make sure that the rules are being observed with regard to the goods the haulier is carrying and that you know the documents that the driver must hold as well as the rules on the local roads that are travelled.
Nick McEwen an associate in the corporate and commercial team, said “all businesses must protect their brand; it often takes years to build and can be extremely difficult to recover if the intellectual property slips out of your control.”
From 1 January 2012 if your business is based in the UK and you have an .eu website if you live outside the EU/EEA and you are not an EU/EEA citizen you will not be able to renew or register .eu domain names. However, EU citizens who are resident in the UK will be able to retain their .eu addresses. If you hold a .eu domain or are thinking of obtaining one you may still be eligible if you have registered office, central administration, or principal place of business within the EU/EEA, are established within the EU/EEA, or are a natural person resident in the EU/EEA. What happens next is that EURid, the registry which is responsible for the day-to-day running of the .eu Top Level Domain will send out a notice to all .eu registrants who appear to not be eligible to retain their .eu domain. If by 1 January 2021 the registrants are still not eligible the domain name will be withdrawn and retained for a period of 12 months after which the domain will be made available for others to register.
With regard to EU citizens engaged to work and reside in the UK, they will be subject to the criteria and procedures the UK applies to immigrants from countries across the globe.
The Confederation of Business and Industry director-general Dame Carolyn Fairbairn, echoes the sentiments of the vast majority of UK businesses when she said at the first CBI International Trade Conference, “trade offers one of the most powerful routes to post-pandemic recovery. Now is the time for the UK to champion free, fair and open trade, particularly in industries of the future, from services and low-carbon innovation to tech and life sciences.” The CBI is strongly in favour of the EU and the UK finding a way to make a trade deal.
For more information about managing the dual challenges of Brexit and the effects of trading with the measures to combat coronavirus please click here