Well, it looks like Brexit might actually happen by the end of 2020, with or without a free trade deal - although any form of Brexit means No Deal for services.
If you're a director of a company, you will need to be able to demonstrate that you satisfied your duties in the context of Brexit, which is a well-publicised event with some clear consequences. Those duties will vary depending on where your company is incorporated, but steps you'd likely need to show you have taken include: holding board discussions, appointing a sub-committee (with minutes, briefing papers and presentations), creating and updating risk registers, scenario planning sessions and related documentation, supply chain analysis to identify suppliers at risk who may need to be replaced/helped (some may be using the wrong type of pallet for export to the EU, say, or hauliers may be allowed into the UK by UK authorities, but will struggle to back into EU); and making resolutions taking action to address threats and opportunities.
The impact on goods, in terms of tariffs and so on, is more widely understood, but barriers to trade in services are more complicated and less consistent between markets. They also depend on visa and immigration controls, since services usually involve more human interaction with customers in the target market.
We have previously outlined an approach to 'Brexit-proofing', but examples of steps you can take include:
- contractual preparations, including the relatively simple option of novating English law/language contracts with EEA-based entities to be subject to Irish law and courts;
- working out when to terminate contracts with suppliers who can no longer supply their goods or services, either at the right price or at all;
- agreeing a new basis for transferring personal data from the EEA to the UK;
- seeking new licences or authorisations in the EEA (or pursuing an alternative if you are late in getting financial authorisations, for instance); and
- factoring in the incentives offered for setting up a new subsidiary in an EU27 member state, such as those for setting up in Ireland;
- considering the impact of visa and immigration requirements on your plans to support your EEA activity (bearing in mind that the Common Travel Area between Ireland and the UK pre-dates the EU and will continue after Brexit);
- exploring the tax impact of moving business activity to an EU27 country (for instance, whether there might be a capital gain, tax on profits moving offshore, or an impact on any current withholding tax exemptions you might have).
Good luck with your preparations - and let us know if we can help!
If you're a director of a company, you will need to be able to demonstrate that you satisfied your duties in the context of Brexit, which is a well-publicised event with some clear consequences.