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Brexit: the final countdown?

Tom Rathborn Tom Rathborn

With one month to go, businesses still don’t know what they will be facing next year (if Brexit finally happens). Tom Rathborn looks at where negotiations are up to, what we're seeing in the market and the key things for you to focus on.

There's a crucial week ahead, though I will admit that I've been saying this for weeks.

Despite recent claims that a deal is 95% done, as the end of transition draws closer, the UK and EU are still struggling to find an agreement across three key areas:

  • Level playing field provisions
  • Fishing
  • Governance mechanisms

Talks are scheduled to continue this week, but it really is now or never if we're to get a deal.

Ratification unclear at best

Assuming a deal can be reached, it's not entirely clear what is needed for it to become law, or how long this process would take, on either side of the channel.

In the UK, the government removed its commitment to having a vote on the final deal – the most obvious stumbling block - but this does not mean a vote won’t happen.

On the European side, we're already way beyond what would normally be required to ratify a deal of such magnitude. By way of comparison, the Free Trade Agreement between the EU and Canada took 63 weeks to formally ratify. There are currently less than five weeks until the transition period ends.

It's clear, however, that the EU is looking to do everything they can to accommodate any last-minute deal. There are even talks of a special vote on 28/29 December for EU ratification – just three days before new rules would come into place.

With no precedent, we just do not know how this will work.

No-Deal must be the working assumption

The potential for last minute details doesn’t impact Brexit planning.

Organisations need to prepare for wholesale change come 2021. Only another delay, either via an extension or the addition of an implementation period, is likely to change that.

Businesses waking up to the reality of Brexit

Following a year dominated by COVID-19, many businesses only recently turned their attention to Brexit.

You could be forgiven for thinking that politicians would have agreed on a deal by now, and there would be certainty over the trading environment for 2021. Sadly, that's not the case, and while frustration has grown, so has a sense of pragmatism. We've seen a marked rise in inquiries about Brexit over the past few months.

Clear focus on communicating preparation and plans

Some organisations have done a lot of detailed work in preparation for 2021.

Their focus now turns to how best to communicate their efforts to key stakeholders - reassuring, educating and providing a point of contact.

There are also specific concerns around making sure that everyone inside the organisation understands any new rules and processes. We've seen a few clients get caught out where staff aren't fully aware of decisions taken by management that might impact their work.

An example of this is sales teams agreeing deals with customers that management have decided are no longer profitable in 2021.

Fine tuning Brexit preparations

With so little time until the end of transition, what should organisations be focusing on?

Triple check your plans

This year, both the UK and the EU have re-issued guidance on the rules that may come into force next year. Make sure that all your planning is based on the most up-to-date guidance.

Keep an eye on announcements

It will be hard to miss if a deal is reached or not, but other, potentially more-important announcements, might not be so obvious.

For example, the EU is expected to release emergency legislation to come into force in the event of No-Deal. These may include critical information for organisations trading with Europe. Don’t miss them.

Ensure everyone knows their role

A Brexit plan is useless if your staff don't understand its implications for their day-to-day jobs.

Are you confident that all your staff know what impact Brexit will have on their roles and who to speak to if they have any questions?

Be ready to respond over the holidays

With potentially crucial government announcements set to come during the holidays, ensure that you have the necessary measures in place to enable you to respond in real time without being bounced around out-of-office notifications.

This may be as simple as agreeing a WhatsApp group, including key internal stakeholders.

Brexit is not over yet, but four-and-a-half years since the referendum, the end is in sight. We'll keep you up to date on any changes and explain how any deal impacts your business.

For further support on Brexit, visit our Brexit hub.

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