Brexit planning – if you do just one thing now, check your territories!
Whilst we are in the Transition Period, due to last only until 31 December January 2020, getting your business as ready as possible for changes to EU-UK trading relationships is crucial. Please check out our portal pages for practical tips on what you can do now, as there are a number of steps you can take, even though of course so much still depends on the terms eventually agreed for the future trade deal. However, one thing you should do now is check your contracts for references to the EU as a territory. The UK left the EU on 31 January 2020 so it no longer forms part of the EU, even though for trade purposes it is being treated for the most part as if it was still in the EU. So, where your commercial contracts contain references to the EU you may need to amend these to specify whether this includes or excludes the UK. If the contract refers to the EU being “its member states from time to time” but you actually want it to include the UK, then you will need to agree an amendment to re-include the UK. You might also consider whether you want there to be a differences between pre and post 31 December 2020/the end of the Transition Period, to give you flexibility if the eventual agreement on trade doesn’t fall helpfully for your contractual arrangements.
Distribution agreement and licences often refer to territories, so this would be a sensible first place to start in your audit. However, restrictive covenants can also include references to territories such as the EU so employment contracts as well as shareholders agreements and share purchase agreements should also form part of your review.