UK: Scots Legal Firms Remain Stalwarts Through Brexit Uncertainty

Last Updated: 4 January 2019
Article by Murray McCall

As we look ahead to Brexit, the European Commission has announced in its autumn projections that economic growth in the UK will be weak for the next 2 years - and the risk of a 'chaotic Brexit' could mean growth is dampened even further.

Scottish businesses are continuing to go through a period of uncertainty as we approach the exit date of 29th March 2019 with British business groups now saying 'no to a no-deal'. Considering the response from the CBI and 4 other leading UK business groups calling for a focus on the 'practical steps that business needs' to move forward on, it's true to say our Scottish law firms continue to be the stalwarts of the business community when it comes to Brexit advice. 

At Anderson Strathern, we're finding that demand for advice around the key issues relating to Brexit is growing. Despite the uncertainties, there is a real drive on the part of our SMEs and larger Scottish organisations to be mindful of the short-term challenges, while keeping their focus on growth and longer term strategic objectives.

We were one of the first firms to launch a Brexit Group in 2016 – immediately after the result of the referendum.  We brought together a group of experts in specialist areas to advise our clients on all things Brexit related, and as we enter a new phase, we have refocused our team of experts on the key commercial challenges we're finding our clients now face, whether there's a deal or no deal.

Key issues for the Scottish business community

One thing we do know is that Scottish businesses are not sitting back to see what happens next. There are a number of core aspects where our advice is being sought ahead of 29th March:

  • Restructuring business supply chains
  • Revising commercial contracts,
  • Data sharing arrangements
  • Taking proactive immigration and pensions advice
  • Helping to manage cashflow through effective debt collection
  • Preparing for a different trading environment

The uncertainty surrounding Brexit is having a marked impact on the level of advisory services in Scotland. Scenario planning and strategic oversight is now a much larger part of the picture for businesses. Our clients want to know what Brexit will mean in a Scottish business context and, with a volatile political environment and the real potential for 'IndyRef2', we're finding that our full service legal approach gives our clients a proper one-stop-shop for Brexit related advice.

From the uncertainty surrounding immigration, especially for the education sector through to construction sector concerns about labour costs and access to European funding, as well as transport and freight, logistics and supplies, there is a wide range of Brexit issues to consider. The lack of detail surrounding the financial services industry, post-Brexit, will also be a consideration for many companies based in and around Edinburgh. 

We'll be reporting on these key themes in the run up to and beyond Brexit.

Uncertainty causing a focus on debt recovery and risk issues

While we did notice a fall in transactional business in the aftermath of the 2016 European Referendum, we've found that 2018 has been one of our best years ever, boosted in part by Brexit related advice.  We're also seeing strong growth across a number of our legal disciplines, particularly in commercial litigation and regulatory work, including around GDPR which fuelled a keened focus on corporate governance and risk issues amongst clients.

This growth arises for several reasons, including the economic uncertainty Brexit is creating in the market leading to heightened cashflow difficulties for many, fear that customers may collapse owing significant sums - the collapse of Carillion being a case in point, all leading to growth in debt recovery services and the need to get some cases into court more quickly.

European labour

We also have many clients who are heavily reliant on European labour, with issues around immigration and recruitment having grown over the past few months.  It's well known the hospitality, food & drink, tourism and agricultural sectors have all needed European labour over recent years, and increasingly have had to compete for such labour.  As well as the traditional sectors, our higher education institutions in Scotland also all rely heavily not only on overseas students for income, but on highly skilled European lecturers and professors.

Brexit advice

With new issues arising every day and as we continue to offer specialist Brexit related advice to our clients in the run up to 29th March, our team of expert lawyers will be on hand to guide businesses and institutions through the challenging times ahead.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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