Britain Urges Businesses to Prepare for End of Brexit Transition Period

Illustration picture with EU flag, British flag, and broken glass is shown in file photo taken on Jan. 31, 2020. (Reuters/Dado Ruvic)

The British government, in an urgent message to UK businesses on Oct. 12, told them to prepare for the end of the Brexit transition period whether a trade deal with the European Union (EU) is reached or not.

British businesses will play “an essential role” in ending the Brexit transition period smoothly and will have to tackle "guaranteed" changes to how they import and export goods, hire people from the EU, and provide services in the EU marketplace, Business Secretary Alok Sharma said, even if a trade deal with the EU is not reached.

"It is vital that your business prepares now for our new relationship with the EU," Sharma said in a media release.

"There are 80 days until the end of the transition period and there will be no extension, so you need to act now."

The flag of the European Union and the British national flags are flown during a demonstration by Remain, outside the Palace of Westminster in London on Feb. 27, 2019. (AP Photo/Alastair Grant)

Business Interruption Risk

Businesses must prepare for the changes or “there is a risk business operations will be interrupted,” Sharma warned.

The government is providing a package of support to help businesses prepare for Britain’s “new start” ahead of Dec. 31, including an online tool to assess which actions a business needs to take and a series of free live webinars.

According to government guidance, to get ready for new arrangements from Jan. 1, businesses need to do things such as ensure any staff from EU countries register for residency rights, and prepare for customs procedures when trading with the EU.

After Dec. 31, British citizens will also need to observe new rules for travel to the EU, Switzerland, Norway, Iceland, and Liechtenstein, with additional rules for business travel.

Still Haggling

Britain left the EU on Jan. 31, but more than four years since Britons voted 52 percent for Brexit in a 2016 referendum, the two sides are still haggling over a trade deal to take effect when informal membership ends on Dec. 31.

The two chief negotiators, the EU's Michel Barnier and Britain's David Frost, say they're inching toward a deal ahead of an Oct. 15 deadline, but that important gaps remain on fishing, level playing field issues, and governance. Both sides have planned for a no-deal scenario.

In the transition period since leaving the EU, European rules have continued to be applicable for Britain and will continue to be so until Dec. 31. If no trade deal with the EU is reached by then, Britain would by default need to trade under the World Trade Organization rules.

Reuters contributed to this report.