Although we have left the EU, businesses and individuals will be unlikely to notice any changes on a day-to-day basis during the transition period (from 1 February until 31 December 2020). The UK will effectively remain part of the EU for trade and customs purposes, so the current rules on trade, travel, and business for the UK and EU will continue to apply during the transition period. However, this period is a good opportunity for businesses to take steps to prepare for trading after the end of the Transition Period.
On 1 February 2020, the UK left the EU and has now entered into a transition period until 31 December 2020. During this period, the Government will negotiate a trade deal and its future relationship with the EU. We are supporting businesses through the transition so please contact us to see how we can help you.
Although the Government has commented that given the current alignment of UK and EU laws in all material areas, this task should be made easier, and the two sides have agreed a framework in the form of the political declaration. Some negotiators and commentators have suggested the time frame for negotiating a deal is very tight. The Prime Minister has however made it clear that there will be no extension of the Transition Period into 2021.
Although it seems more likely than not that there will be a trade deal, this will still mean the UK will be outside the Single Market and Customs Union and the trading situation will change. Until we get further clarity from the Government over the details of a likely future trade deal, businesses need to be aware and if necessary take steps to prepare for a more distant relationship with Europe. No matter what the shape of the future trade deal however, businesses moving goods into and out of Europe will need to make customs declarations and all businesses will need to ensure their workers who are EU citizens have got or applied for settled status if necessary.
During the transition period the UK will be able to hold formal trade talks with other countries including the US and Australia, which if successful could apply as soon as the transition period ends at the beginning of 2021 so businesses should be giving some thought to opportunities these may bring.
In the sections below, we look at what may happen from the legal perspective in key areas, focussing on the effects of an exit without continued access to the Single Market and Customs Union (which will be similar to those of a termed “hard Brexit”), and what businesses can do to minimise any risks.
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