If there is one thing that can be agreed on after the Brexit vote, it is that there is a lot of uncertainty. And this uncertainty not only affects Britain, it affects each and every company doing business in Britain, and in particular those businesses around the world that found Britain to be the best gateway to Europe, the Europe of the European Union (EU).
Once Britain has officially given notice under Article 50 of the EU Treaty, the exit from the EU takes place automatically after two years unless the EU and Britain achieve the exit within a shorter period of time or agree on a longer period.
There are many scenarios being discussed, including a full exit within two years, with Scotland gaining independence in the meantime and becoming a new EU member and Northern Ireland attempting to unite with Ireland and thus staying or getting back into the EU, and the remainder of the United Kingdom either facing a prolonged economic crisis or rising to new and repositioned importance. Or, on the opposite end of the spectrum, the United Kingdom going through a second vote which reverses the first decision and thus staying as a member of the EU.
Some of those scenarios are more likely than others. There is a strong tendency within the EU not to allow Britain any special treatment any longer. This tendency is certainly counter to remaining in the EU on a negotiated basis with added exceptions for Britain (and encouraging other EU members to have a go at getting a better deal). Also, and for the time being, the British people have spoken and voted in their majority for Brexit. To repeat the delegation of power from the elected to the electorate within a short time and on the same topic opens up a dangerous path which again leads to uncertainty.
Based on the assumption that any company’s decision to do business in and out of Britain was triggered by certain business and/or legal reasons, we recommend going through the following three-step analysis:
- Will those reasons likely be affected by the uncertainty which arose because of Brexit?
- What is my risk and opportunity analysis?
- How do I best respond to my risk/opportunity exposure caused by the current uncertainty? Is there anything I need to do now to avoid or minimize risk exposure?
Conducting this analysis will allow your business to have a clear understanding of what risks and opportunities your organization may face at this uncertain time. While we don’t know what the time period will be for Britain to exit the EU, or if it will happen at all, we can be certain that there are difficult conversations and decisions to be made. This alone is a driver for analysis and preparedness for a possible response now.