How Brexit will impact businesses will depend on every industry across the board. It is but prudent that if you have an existing business, you should be familiar with some expected realities to happen so that your livelihood can prepare well for a life after Brexit:
1) Legally Alluding to EU as a territory
The UK’s departure from the EU could lead to a non-exclusive treatment of UK in terms of contracts. Any area of exclusivity before will be cut in such a way that it will no longer cover the UK and might be an impediment to the parties’ intentions.
Businesses, in this respect, should clarify and address the territorial scope.
2) Supply Chain
There are 2 types of movement of goods: transfer of goods from EU to UK, and the transport of goods from UK to EU.
For sure, there will be a required completion of new customs procedures. If your business trades within the EU, make a review of your contracts and make emergency plans for export controls on the sales of your goods to EU countries. Your business also requires an Economic Operator Registration and also an identification number for you to move your products between the UK and EU.
Tariffs which were non-existent before might now be applied to your goods and services following Brexit. It should be considered therefore who is going to absorb the additional costs, and how these costs will be computed. It is also imperative to come up with ways to reduce the cost of these tariffs.
4) Exchange Rates
There will be expected changes in the exchange rates as shown when the UK currency, the pound, fell sharply against both the dollar and euro after the Brexit referendum in June 2016. Your business should consider seriously whether you are protected in your contracts from inconsistencies in the exchange rate before moving forward with new negotiations.
5) Delay of Movement of Goods
New customs checks will be required for products entering and leaving the EU when the UK stops being a part of the customs partnership with the EU. You must think about the negative impact of the delay due to new processes and what your solutions are if your product or components source is late because of the new procedures.
6) New Contractual Terminologies
After Brexit, any mention or reference to EU regulations, laws and bodies will have to be revised so that they are realigned to the needed national references.