Brexit and businesses that export services to the EU
At this time, the UK Government appears to be advertising in the national and business press almost on a daily basis with its "no deal" Brexit guidance/ warning notices on different subjects, referring readers to more detailed guidance on the government website - gov.uk/brexit - "Get Ready for Brexit".
On 8th October 2019 , the focus of the UK Government's advert was the services sector - and in particular UK based businesses that intend to sell services into the EU, the EEA and Switzerland post-Brexit.
The detailed guidance on the UK Government's website - which contains useful links to additional sources of information - stresses the importance of UK businesses having to check in advance the local rules applying within the individual states to which exports of services are to be made post-Brexit , so as to ensure compliance. This is because, post-Brexit and in the absence of a "deal", the UK will be generally be treated as a "third country" as far as the EU etc is concerned, with no special trading rights within the countries concerned.
Particular sub-headings within the detailed guidance include "Trade regulations", "VAT on sales of digital services", "Establishing and structuring your business", "Sector-specific information", "Business travel and entry requirements", "Social security payments for employees", "Recognition of professional qualifications" ( with specific sub- sections on "lawyers" and "auditors", both highly-regulated professions) and "Data transfer and GDPR". This long list of sub-headings gives some clue as to how seismic the changes in doing business with the EU etc might be post-Brexit, certainly in the services sector, unless a free trade "deal" between the UK and the EU can be achieved very quickly.
From a company law perspective, there is one stand-out concern above others in the detailed guidance, which should not be overlooked and it is stated as follows, in the context of a possible "no deal" Brexit:-
"UK companies and limited liability partnerships that have their central administration or principal place of business in certain EU member states may no longer have their limited liability recognised."
This may lead UK businesses with substantial dealings within the EU etc to set up local subsidiaries in the countries concerned, where they would not have done so before Brexit. Clearly local advice on the implications of doing this will need to be taken.
The World often seems a complex place in principle within which to engage but practice and common sense will sometimes sort out the answer more quickly than might have been expected. It is a case of "Needs must!".
Most businesses are hoping for a soft landing, Brexit or no Brexit, deal or no deal. Let us hope that they will not be disappointed!
