Business Matters: Preparing for the Impending Brexit
Brexit looks to be a done deal — even if there’s no deal in sight. London and the rest of the UK will no longer be part of the European Union, and your business needs to change with the changing times.
Update Your Contracts and Requirements
Confirm your existing contracts with clients and suppliers. Bring in lawyers if you need to write up new ones. Instead of an EU partner, you’ll now be an international exporter or importer, and you’ll need to include complications like value-added taxes (VAT) into your terms and contracts. You’ll also need to fulfill specific requirements to continue doing business outside the UK. Make sure you have an Economic Operator Registration and Identification (EORI) number that starts with GB or apply for one if you are exporting goods. If you are importing, your supplier (even if it’s a subsidiary of your company) needs a corresponding EU EORI number. You’ll also need to register for the new Computerized Transit System to manage your transit declarations.
Manage Your Logistics
Taxes, customs, border crossings — you’ll now need to deal with problems you’ve never had before. Expect a little bit of delay on your imports due to customs as well as additional VAT that comes along with it. Expand your logistics space and bulk orders to make some leeway for delays in shipping. You’ll need experienced staff to handle customs and export declarations, especially if you have multiple or time-sensitive transactions. Check your transit options and make sure they take advantage of individual countries that use the Common Transit Convention (CTC). This lets your goods pass through certain borders without needing a declaration or payment of customs taxes; customs duties only get charged once your products reach their destination. You’ll also need a comprehensive customs guarantee (CCG) to cover ensuing debts from customs procedures, or you might need an original warranty if your transactions cost more than a CCG can cover.
Adapt to Changing Times
Brexit might not be the only thing shaking the European Union. Italy is currently facing a political crisis, and Germany’s economy is on the brink of a recession. Germany’s economy will further take a blow with a no-deal Brexit, and a weak German economy will have severe repercussions in the whole Eurozone economy. With the EU’s all-encompassing influence on its members, countries that want smaller government or more centric policies have no other option but to leave, and the UK has shown that leaving is possible. Give your business leeway to adapt to any other EU-shaking events and limit expansion for 2-3 years. Changes in the political landscape of Europe are coming, and you want to be able to weather any storm.
Brexit is happening. It took more than three years, but the UK is finally leaving the European Union. Unlike the UK, your company doesn’t have the option to defer or extend your existing business dealings. It needs to adapt to the new situation immediately, take care of the ensuing problems, and grasp every opportunity that presents itself.