Brexit Business Risk Analysis

Solicitors London

Is your business ready for Brexit?

The Government has triggered Article 50, which has begun a two year process that will eventually see the UK leave the EU, following a period of negotiations with the other member states.

In preparation, the Cabinet has already begun laying out some of their plans for negotiations and have indicated that they are willing to leave the single market if they are unable to secure a suitable deal, which is likely to include changes to immigration.

This means that business now only have a very limited period to prepare themselves for the fundamental changes ahead of them.

Therefore it is extremely important that businesses plan for the challenges they may face in the next few years sooner rather than later.

Failing to plan is planning to fail. Can you afford to wait for things to happen? Or are you happy to get left behind?

Complete our questionnaire to see if your business is at risk from the effects of Brexit.

Step 1

Name:

Company name:

Email:

Telephone:

Company address:

Risk Analysis

The headings below indicate common areas of concern and risk for businesses. If you have a particular issue that you are worried about, please complete the most relevant questions relating to this area.

Income

1. Introduction of tariffs – At the moment the UK pays no tariffs to the EU as part of its single market arrangements, but new tariffs may be levied if we leave the Union.

Could your business take a sudden introduction of tariffs?
YesNo
Would the additional costs affect your cashflow?
YesNo
Have you sought advice on tariffs?
YesNo
Would it affect contracts/arrangements with European customers?
YesNo

2. Loss of passporting arrangements - Passporting into the EU from the UK will not be possible following a Brexit unless a special arrangement can be negotiated.

Is your business prepared to establish overseas subsidiaries if passporting is removed?
YesNo
Have you considered the cost of this?
YesNo
Would you lose clients as a result if you couldn’t passport?
YesNo

3. Relocation of your client base – Following Brexit some businesses may see European clients withdraw from their market, due to tariffs and additional costs.

Are the majority of your clients based in Europe?
YesNo
Could you afford to lose your European clients?
YesNo

4. Changes to VAT and other indirect taxes – The UK is currently bound by the EU VAT Directive, but may be forced to pull out of this arrangement.

Is your business prepared for any potential changes to VAT?
YesNo
Have you sought advice about what these changes would mean?
YesNo

5. Significant currency fluctuation – We have already seen sterling decline since the vote to leave the EU and further fluctuations are expected.

Has your business been affected by currency fluctuations already?
YesNo
Could your business sustain further drops in the price of sterling?
YesNo
Have you thought about how fluctuations could affect established contracts and fees?
YesNo
Is your business prepared/able to trade in different currencies?
YesNo

6. Security of supply chain – Brexit and subsequent tariffs are likely to affect trade between you and your suppliers.

Do you have suppliers in the EU?
YesNo
Do you have suppliers, with their own suppliers in the EU?
YesNo
Have the costs of European supplies already gone up due to currency fluctuation?
YesNo
Have you considered how the supply chain to the EU might be affected?
YesNo
Have you amended your supplier contracts to take into consideration the effects of Brexit?
YesNo
Have you considered how disputes would be handled with European suppliers after Brexit?
YesNo

People

1. Restriction on inward immigration – The EU and the UK has been quite clear about curtailing the Freedom of Movement arrangements.

Would this affect client relationships?
YesNo
Would your firm struggle to recruit for skilled roles?
YesNo
Would this affect your supplier’s ability to import goods?
YesNo

2. Visa requirements on EU workers – Should the rules on immigration change exisiting staff may need to assess their visa status.

Have you discussed future visa arrangements with staff?
YesNo
Are your EU staff looking at permanent resident status?
YesNo

3. Visa requirements imposed by other states – Outward travel from the UK may also be affected by Brexit.

Would it affect your ability to send staff to overseas subsidiaries on secondment?
YesNo
Is your business prepared for the additional administrative burden of regular visa applications to the EU?
YesNo

4. Employment legislation – The UK is currently bound by EU regulations on working hours and other employment issues.

Have you thought about the impacts of rolling back the UK’s existing employment law framework?
YesNo
Would it require you to change employment contracts?
YesNo
Are you prepared to create different rules between employees in different countries?
YesNo

5. Alternative sources of staff resources and skills shortage – Many EU citizens may be required to leave the UK in the future.

Would your company experience a skills shortage if this was the case?
YesNo
Would you be able to find the same talent in the UK?
YesNo
Would this affect your current senior leadership team?
YesNo

Step 2

Preparation of a plan

Now you have answered questions regarding your areas of concern, let’s see how your plans for Brexit are shaping up. During your planning for Brexit have you considered the following:

Relocation of trading

1. Choice of location

Have you already considered moving?
YesNo
Do you already have plans to move?
YesNo
Have you thought about overseas subsidiaries?
YesNo
Would Brexit require you to change where you are headquartered?
YesNo

2. Tax jurisdiction

Do you understand the implications of your move on your tax liabilities?
YesNo
Could a move bring beneficial tax arrangements?
YesNo

3. Suitable trading structure

Would your business require restructuring?
YesNo
Could you gain some benefit from changing your trading structure?
YesNo

4. Language issues

Do your current staff have useful language skills?
YesNo
Could relocation affect your ability to communicate with clients?
YesNo

5. Regulations

Have you explored the regulations in your country of choice?
YesNo
Could a change in regulations affect your current operation or existing contracts and agreements?
YesNo

6. Timescale

Have you consider how long a move would take?
YesNo
Would your business be able to move before Brexit?
YesNo

7. Governmental grants/funding

Could you benefit from new funding overseas?
YesNo
Is Brexit likely to affect your current funding from the EU?
YesNo

8. Effect on existing employees

Are staff prepared to move?
YesNo
Have you consulted them?
YesNo
Would redundancies be required?
YesNo

9. Office costs and accommodation

Have you thoughts about the cost of relocation?
YesNo
Do you have an understanding of overseas property laws/regulations?
YesNo
Would relocation affect current rental/lease agreements?
YesNo

Business Activity

1. Changes to resources from increased/decreased trade

Have you considered the impacts of a decline in trade from EU customers?
YesNo
Would more than 50 per cent of your customer base be affected?
YesNo
Would more than 50 per cent of your supplier base be affected?
YesNo
Do you have sufficient reserves to make up the shortfall?
YesNo

2. Liquidation of surplus trading entities

Could liquidating existing trading structures be beneficial after Brexit?
YesNo
Would you be looking to liquidate any existing trading entities?
YesNo

3. Recruitment/Redundancy Costs

Have you considered the costs of redundancies?
YesNo
Have you considered the potential legal requirements of redundancy?
YesNo
Have you considered the costs of recruiting new staff?
YesNo

If you have any additional questions, queries or concerns, please include them below: