Following ratification of the Withdrawal Agreement in the European Parliament, the UK formally withdrew from the EU on 31 January 2020. Now, the next phase of negotiations begins.
The EU and UK negotiators have the unenviable task of agreeing an unprecedented trade deal in months, rather than years. Irish businesses should prepare for varying degrees of a potential hard Brexit in the long-term trade agreement.
The amendment blocking an extension to the transition period means that, should a trade deal not be agreed by 31 December 2020, there is the risk of a "no future economic partnership exit", under which the UK will trade with the EU in the future on WTO terms.
While many organisations have completed their Brexit planning scenarios, it is imperative to consider how the trade agreement may take shape and how any proposed changes will affect your business.
Why do we believe this?
The Transition Period, which may prove too short for businesses to adequately prepare for the impacts of Brexit. There is a possibility that the timeline is too short to conclude a very comprehensive FTA by the end of 2020. Businesses and other stakeholders should take control and do what they can.
What are the implications for business?
We advise businesses to consider the detail of the Withdrawal Agreement Bill and, if relevant, how to address the proposed changes it contains as well as the broader consequences brought by the end of the transitional period. The changes will have potentially far-reaching implications for businesses, which we will be exploring over the coming weeks.
Businesses should also keep a firm eye on exchange rate fluctuations. These may continue to fluctuate pending speculation on the terms of any free trade negotiation that may crystalise.