It is now over a year since the UK voted to leave the European Union and over three months since the formal trigger was pulled. What is clear is that since Theresa May’s election result, the negotiations are going to be very tough. Significant uncertainly remains over whether the UK will end up with a “soft” or a ”hard” Brexit. Whatever the outcome, and it will be sometime before the picture clarifies, what is clear is that the UK will not be able to act as the gateway to Europe for US firms in the way that it has done in the past.
It currently seems likely that “passporting,” that is the ability for, say, a UK subsidiary of a US firm, to provide services across the EU, will end. A possible alternative is “equivalence”, where the EU regulatory authorities allow non-EU firms (including potentially both the UK and the US) to provide limited services across the EU. If “equivalence” fails then US firms currently accessing the EU through the UK may have to think about establishing a new presence within the EU.
While many uncertainties remain, now is the time to start thing about contingencies. Our Consultants are well placed to help US firms analyze the possible scenarios and help with contingency planning both initially and as the final picture emerges.