HOW WILL BREXIT AFFECT YOUR BUSINESS?
HOW WILL BREXIT AFFECT YOUR BUSINESS?
In our earlier blogs we concluded that nobody could really know exactly what would happen if we chose to leave the EU and currently, that position remains the same.
However, now it seems to be a case of “when” and not “if” as we know that at least part of the UK will be leaving the EU, it’s a question of timing unless (and we have a limited amount of time for this) Article 50 is withdrawn before the deadline. As a savvy business owner you owe it to yourself to consider the potential impact on your business. All business owners need to have contingency plans and waiting to take action passively goes against the grain with many of us. So what do we know in Dec 2018?
(1) Your Buyers (clients/customers)
We’ve already heard that some businesses are making redundancies whilst others are relocating out of the UK. This mean changes in business needs as well as changes in the ability to negotiate, renew and continue with existing and new business agreements. You must be clear on:
- exactly who your buyers are and
- where they are located and
- whether payment of your invoices currently relies on European funding, whether that be by clear business interests in Europe such as EU offices or your research shows large scale dependence on EU funding to monetise their UK business. Time to check out those tender notices and start to dig into the core accounts you are working with
- your EU employees – currently most will be worried and concerned and support needs to be offered here as well as auditing impact on any changes in their immigration status may have on your business
So, for example,
- do you contract with the “whole” of a business but deal with the UK head office or
- are you only contracting with the UK “part” of that business?
- do you have a contract that will automatically end or alter if EU funding changes or ceases?
- does your business rely on EU related products or services which are likely to increase in cost post Brexit? Impact audits will help you here.
We’re not suggesting you go into panic mode, but you should identify how trading with Europe will impact on your current contracts with existing buyers and put into place contingency plans to mitigate any impact on your business.
Tip: Having identified potential impacts regarding existing buyers, now is also the ideal time to review your general business planning including marketing activities for retaining/obtaining/increasing your buyer base. Spreading the load and having diversity in your buyer base is important in mitigating the risks of losing some key accounts.
(2) Look at your business contracts/agreements/documents
Most business will have some standard contracts that they reuse. If those contracts are
- with businesses in Europe and/or
- have clauses and terms which rely on UK being part of Europe
then its time to review these now.
If you need to renew or sign new contracts then some changes at this stage are likely to secure much smoother future trading.
Tip: Review your contracts now to see how you could be affected. Get some advice and make any contractual changes now to secure a smoother “Brexit” process for your business. It’s common for cross border contracts to contain enforcement clauses which rely on EU legislation remaining the same as it has done for the last 30 years. Time to review those contracts.
(3) IP and trademarks
Some businesses have protected their intellectual property (such as their logo) by obtaining a Community Trademark which provides protection in both the UK and the other European communities. The problem is that, on “Brexit”, the UK will no longer be part of the EU and so this raises questions as to whether the Community Trademark will still be valid – i.e. will they separate UK so you still have a trademark which protects you in the UK or will be it be watered down protection in only EU countries and leave you unprotected in the UK?
Larger organisations and/those who may have offices and operations which could be moved and/or split between the UK and other European states will need to review what protection they need and where they need it.
Tip: If you don’t yet have a trademark but it’s on your “to-do list”, now is the time to apply for your UK trademark without delay to avoid missing out on vital protection.
(4) Employees/ workers
It’s also vital that you consider both your employees and anyone else who provides you with help, such as sub-contractors.
Until “Brexit”, many EU workers who rely on their right of free movement to work in the UK may find that
- their status (and ability to work) changes
- their right to work will be based on a tier/points system, where referees and sponsors are required, like the one that the UK uses for non-European citizens.
There are also likely to be changes in employees’ rights so your contracts and policies will need to be reviewed in due course – but not right now.
Tip: be clear about whose status/ability to remain and work in the UK could be affected and arrange to meet with them so you can understand their longer term plans and how you may be able to support them if and when things change. Regardless of Brexit right now, many EU workers are feeling unsettled and concerned. Talking at this stage is always a good HR move and opens channels for discussion of plans which may impact your business. You need an audit to look at the scoping of those roles affected and have in place firm plans now to tackles shortfalls in skills. The sooner this is started the easier it will be.
(5) Be prepared
Whilst there is only so much you can know during this period of uncertainty you can at least make plans to
- keep up to date with developments and
- discuss the impact with key employees and buyers
Tip: Appoint someone who will keep up to date with developments and who can liaise with experts so that you will be ready to take action as and when it is necessary. Being prepared means your business is more likely to survive and continue to grow.
As legal consultants who understand business we provide a range of “Brexit” services, from help with your business contracts and documents, general business planning, IP, employees and generally helping you being prepared.
Keep in touch and we’ll keep you updated with steps your business needs to take after we exit the EU. Start today by signing up for our free webinar, once registered you can join us in real time or get the recording sent to you. Either way you will be on our Brexit list for all the updates (we like to keep it brief and to the point). We will be running periodic webinars on vital areas of law affecting all businesses, so sign up now. Questions? Talk to us on 01244 300413 today.
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