With the Conservative government now in majority, the Withdrawal Agreement Bill is expected to pass smoothly through the House of Commons, having passed its second reading on 20 December 2019.
However, the lack of clarity on Brexit has not gone away. Once the Withdrawal Agreement Bill is enacted, EU and UK negotiators have the unenviable task of negotiating an unprecedented trade deal in months, rather than years. 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 with the EU on WTO terms.
While many organisations have completed Brexit planning scenarios, it is now imperative to consider the current deal and how proposed changes will affect your business.
Why do we believe this?
A deal in principle has been agreed and whilst it is subject to ratification by both the UK and European Parliaments, it is expected to pass. There is also the matter of the Transition Period, which may prove too short for businesses to adequately prepare for the impacts of Brexit. Nevertheless, 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.