It’s been a little over a year since Britain’s shock EU referendum result, and many UK businesses remain in the dark about the future of their overseas operations. Here, Galvin International explores the implications of Brexit for doing business abroad, and outline whether setting up a legal entity overseas could be the answer.
British businesses face an uncertain future
Ever since the UK voted to leave the European Union last summer, UK businesses who operate internationally have faced an uncertain future – and the situation has yet to be clarified. Exit negotiations between the UK and the EU have slowed to a crawl, and there are significant disagreements over everything from citizen’s rights to the Irish border – not to mention the size of the divorce bill. Even the UK government seem completely divided over the possibility of a transitional leaving period. With so much deadlock and confusion in the air, the prospect of a Hard Brexit, which could see the UK sever its European ties without a deal in place, seems more likely than ever before.
Businesses who rely on trade with EU member states are faced with significant uncertainties about many areas of their operations. A Hard Brexit would mean no compromise on key issues, and could see UK and EU trade revert back to World Trade Organization rules. If the UK exits the single market, as seems increasingly likely, it will almost certainly be forced to abandon freedom of movement for citizens of EU member states – potentially creating a significant labour shortage. Businesses could also see restrictions placed on their access to EU markets.
Is an overseas legal entity the answer?
The truth of the matter is that no one knows for sure what agreement, if any, will have been reached by March 2019. Business will need to begin planning well in advance to prepare their contingency plans. However, there is one clear and definitive step they can take to give themselves a significant advantage over the coming years – setting up a legal entity within the EU.
It is much easier than you may think to open a secondary entity in another EU member state. Having this legal entity can provide you with much more certainty and security of knowing that your business with Europe is protected – no matter what happens when March 2019 finally comes around.
In uncertain times, having the right guidance can be crucial to the success of your international expansion. The experts at Galvin International have the experience and in-depth knowledge to help steer your company through the choppy waters of Brexit – including helping you to set up your legal entity overseas. Our entity creation services will help you to determine what type of legal entity your business needs. We can also assist with on-ground implementation – setting your entity up and handling all necessary registrations on your behalf.
Get in touch with us today to discover how your company can thrive overseas.