With another 70 days to go till the ‘final’ Brexit (29 March 2019), it is more than ever likely that both parties will part following a ‘no deal’ scenario. A sudden exit by the United Kingdom from the European Union however has far-reaching implications.
One implication is that the supply of goods to and from the United Kingdom will from one day to the next be subjected to customs duties and formalities. The extra time and costs involved will have a strong impact on companies and eventually the customers.
Given the fact that 4 out of 5 Belgian companies have still not taken any appropriate measures, the Belgian Minister De Croo already announced that every Belgian company trading with the United Kingdom will be assigned a EORI number. This number identifies the company at customs and ensures that it will be able to continue to trade with the British island after 29 March 2019. Minister De Croo hopes that companies will see this as the starting signal to urgently make the necessary preparations.
For a more extensive explanation of the implications of Brexit, we refer to our previous article, which details a number of possible Brexit implications.
The next few days, it remains to be seen whether the United Kingdom will take the right decisions in order to avoid the dreaded ‘no deal’ scenario. There still are a few options to consider
This week, Theresa May will go to Brussels to ask the European Union for a number of concessions, however it seems that these concessions will be no more than a drop in the ocean. It is most likely that the “modified” agreement will also be firmly rejected.
If the British government would collapse in the next few days and elections follow, the new party in power would possibly try to reach an agreement with the EU on its own terms.
Also, a new referendum on the United Kingdom’s exit may not be inevitable. If the British people would then decide otherwise, the entire Brexit process may well be reversed. However, in order to organize a referendum, Parliament required a majority, which currently seems not to be the case.
The most obvious option is that the United Kingdom reaches a cross-party solution for the political deadlock. It is now attempted to have British parliament unanimously support a possible agreement. To this end, May will personally have to make some concessions, which would make it rather a soft Brexit. Brexit would then most probably trend towards the Nordic model, according to which people’s freedom is respected and a free trade zone is created.
If this option would be agreed upon in British parliament, it will have to be renegotiated with the European Union. The 29 March 2019 deadline would then almost certainly have to be extended.
We are closely keeping track of the developments
What can companies do now?
If companies want to avoid unpleasant surprises, they really need to prepare for the no-deal scenario. Vandelanotte’s experts can help you to prepare your company.
If you have any questions with respect to this matter, please do not hesitate to contact our experts directly or by e-mail: firstname.lastname@example.org.
We base our advice on current legislation, interpretations and legal doctrine. This does not prevent the administration from being able to challenge it or to change existing interpretations.