UK businesses, especially SMEs, are viewing the political responses to the shambolic Brexit negotiations emanating from all sides of the house with increasing horror as what appears to be self-serving strategies arise and blur into the next instalment of the slowly unravelling Brexit saga. Pushing back the Commons vote is a tactic that leaves little or no thinking time, once the vote has been cast, for any considered response.
Mrs. May's current position of moving the Cabinet to a "war footing", now she believes her position is safe, and presenting them with previously unseen "no deal" approaches seems to be a very close run game. A fractured Cabinet and the strong likelihood of her Brexit deal being voted out, narrowing the opportunity for challenge with a postponed parliamentary vote seems more like political game-playing than acting in the best interests of the country and the businesses that keep it afloat.
The lack of both information and direction from the government has resulted in businesses finding that they are having to hastily create no-deal plans which are costly and lacking in well thought-out strategies. Colin Clark, a Scottish Conservative MP, said somewhat pointlessly, that contingency planning by the Government should have started immediately after the vote in 2016. Further commenting that in his experience contingency planning is never a waste of time or money. Hindsight is, as always, little comfort.
Both the Confederation of British Industry (CBI) and the Institute of Directors (IoD) have complained about the lack of clarity regarding Brexit; with the CBI commenting "Uncertainty is throttling firms and threatening jobs – not in the future but right now"; and the IoD claiming that business leaders were "tearing their hair out at the current state of negotiations". The commercial lawyers at Giambrone have recognised that for many SMEs, if UK has to default to the World Trade Organization rules, they will have to abandon trading in the EU, with tariffs of 16.9% for footwear alone it would be impossible to compete.
Our commercial lawyers advise that one sure way of ensuring that business can continue post-Brexit is moving all or part of their company to the EU country that holds most of their market. This may be easier than you think with the assistance of multi-lingual, multi-jurisdictional lawyers with offices both in the UK and your chosen UK country. Restructuring the firm to facilitate continuous business may, initially, require some adjustment but once the new plan is underway it will not seem as complex as it sounds. Re-locating your head office or at least a functioning office, does not mean that anything else has to change to any great degree. EY (Ernst & Young) found that their Financial Services Brexit Tracker revealed that 34% of the companies tracked were planning to move at least part of their operations to Europe. Whilst such an adjustment is not to be regarded lightly, if it can be achieved it will enable the SMEs across the country, often the lifeblood of communities all over Britain, can be held together and continue providing prosperity to their local communities.
Giambrone can advise on a variety to related aspects when relocating a business or opening a branch in another country.
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