Uncertainty

Political, policy, economic and trade uncertainty will continue until the UK reaches future agreements with the EU and other countries and implements such new legal and regulatory regimes as are considered appropriate. This is likely to impact business planning for 2-10 years.

Investment and FDI

Investment (internal and inward) may be deferred due to uncertainty, relating to the UK's withdrawal from the EU single market and concerns that there may be a potential short term economic contraction, restricting liquidity. When the trading arrangements between the EU and UK become clearer a wave of investment may be released.

Market Economic

A short term economic contraction (recession) and falls (and volatility) in UK stock markets following Brexit may affect sales and business confidence and investment.

Currency fluctuation/reliability

The pound is likely to be volatile and (in the short term) may fall substantially. This may make exports more attractive (subject to additional tariffs and administrative and regulatory effects) but cause inflation and increased costs of imports (in addition to tariff, administrative and regulatory effects).

Skills and Staffing

Reduced EU migration (and emigration of EU citizens currently in UK) may reduce the available workforce and impact skills (including knowledge-led roles). Restrictions on UK citizens working in the EU may affect EU business development for UK businesses. Skills pressures are likely to be especially acute in construction, academia, agriculture, healthcare and seasonal employment.

Words of comfort have been given by certain EU member states (such words of comfort are not binding) in relation to the rights of UK citizens who have been living and working in certain member states for a substantial amount of time in advance of exit day. A visa may be required for entry, however it is possible that in the short-term a visa-waiver may be put in place for entry for tourism and short visits.

The UK has stated that any EU nationals settled in the UK as of the exit day will be able to apply for a settled status scheme in which the individual is able to live and work in the UK so long as they do not exit the UK for longer than a two year period.

Supply chains

Existing supply chains may be disrupted. This may include additional cost (from tariffs and administrative, regulatory costs), reduced reliability (due to import/export controls) and extended timings (where border controls are necessary, just in time deliveries may be affected). New supply chains may take time to establish. Some suppliers have begun stock-piling as a mitigation measure for a 'No Deal' scenario.

Contractor/ Supplier Solvency

Insolvencies and business restructurings are likely to spike as exposed businesses are put under greater economic pressure. This may affect supply chains, customer demand and recoveries.

Goodwill and perception

Changes to perception of the UK as a nation and place to do business will likely result in a less warm welcome in the EU. In other countries there may be additional suspicion/sceptism of the UK as an independent trading nation. Conversely, some countries may welcome an independent UK brand due to the UK's release from the EU's regulatory regimes.

Business restructuring/relocation

Businesses may relocate to EU or divert business which is currently done in the UK to EU affiliates. This will reduce contracts available in the UK. It may take time to develop alternative business from other sources. Conversely, some businesses may be attracted to establishing in the UK due to the UK being more flexible outside EU tax regimes and regulations.

Tax structuring

Businesses currently using EU tax structures may realign business to maintain positive corporation and sales taxes (as well as tariffs). Alternative UK bespoke tax structures may take time to develop.

Access to markets

Whilst it is expected that in a 'No Deal' scenario UK businesses will maintain regulatory alignment with the EU in the short term, UK businesses may be unable or restricted in bidding for or delivering EU contracts due to potential divergence from local or regulatory requirements.

Contracts

Existing contracts may go into dispute/renegotiation where material change or cost is involved. Contracts which are linked to specific delivery or completion dates may be affected by potential border delays and fluctuation provisions may need to be incorporated into contracts. Enforcement in the EU may become harder. Future contracts may come under pressure to incorporate change of law provisions, be under EU law or to incorporate protections for in relation to border issues.

Information

Business access to customer data may be restricted once the GDPR (Data Protection) evolves as the UK will no longer be required to align with EU legislation if it leaves the EU. Existing databases may have to be reviewed. Data exchange with non-EU countries may become less restricted.

Security

Security risks (including cyber-security) may increase due to reduced information sharing with EU members.

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