A leading figure in East Midlands business has written two blogs about Brexit.
In this, the second, he advises businesses about what they should be doing today to ensure a seamless transition to a post-Brexit economy.
The author is Dr Nik Kotecha, OBE, chairman of the East Midlands Chamber’s Brexit Advisory Group and chief executive of the Loughborough-based Morningside Pharmaceuticals. Here is his view:
“In my previous blog, I advised that one of the key questions businesses should be asking themselves is: What are the direct and indirect consequences of Brexit?
There are four key areas we will look into here, which are workforce and future skills needed, cross border trade, taxation and currency, intellectual property and contract changes.
Freedom of movement is one of the main reasons why the UK voted to leave the European Union (EU), but for East Midlands businesses, this does present a number of potential challenges.
At present, any EU citizen is allowed to move to, live in and work in any other member state, which is likely to end at some point after March 29, 2019.
The government has come to some agreement with the EU that all EU citizens currently here, until the leave date, may be allowed to stay and work after we leave. However, any EU national arriving after March 29 and during the proposed two-year implementation period may need to register if they want to stay longer than three months. It will thus fall upon your business to check that EU citizens on your payroll have a right to work in the UK and that they have registered.
Also, consider what your future staffing needs will be over the next few years. If you have to employ people from outside of the UK, then understand what steps you may need to take.
There are three key areas which will affect any business which buys or sells with the EU. These are customs checks, trade tariffs and rules of origin on UK-EU trade.
Customs checks may mean that all UK exporters to the EU have to make a customs declaration, which may mirror the current arrangements of trading with countries outside of the EU.
The issue here is also the resilience of your supply chain because there may be border delays.
So ask yourself: Will I need to change my arrangements with my logistics provider? And will I need to buy additional storage space or increase my inventory?
Tariffs may also be an extra cost, although all UK Chambers are advocating for zero trade tariffs between the UK and EU.
If there are tariffs, you will need to know the International Classification codes for your products and the EU MFN (Most Favoured Nation) tariff that is applicable to your products.
Also ask yourself what the impact of tariffs would be on your costs.