Business operations and Brexit
While there is still uncertainty around Brexit, New Zealand companies are encouraged to review all facets of their current business operations to consider the possible implications and plan accordingly. Companies should focus on their employees, contracts and the potential effect of any change in the pound.
People - Brexit may affect your EU or UK employees. Find out some things to consider in this section.
Currency - Brexit may impact your cash flow and budget. Read our advice in this section.
Contracts - Brexit may affect terms and clauses in contracts. In this section you can read some advice on managing and mitigating the risks.
Data - Brexit will change how the UK is classed under data protection rules. Find out more in this section.
The UK Government has made it clear that free movement between the UK and the EU as it currently exists will come to an end but that EU nationals currently living in the UK will be able to remain immediately post Brexit.
However, EU citizens who want to remain in the UK beyond the implementation period will need to apply to for settled status.
Companies are advised to consider:
- Do we have any EU employees working in the UK or UK employees in the EU?
- How many in each operation?
- Do my employees know what next steps to take to register as an EU citizen working in the UK?
- If you are a large organisation with an intricate supply chain, do we need someone to lead Brexit contingency planning?
The UK Government has created an Employer Toolkit which covers the key details of the EU Settlement Scheme and provides material to support affected employees.
Over the negotiation period and following the outcome of Brexit, there may be fluctuations in the pound. New Zealand companies are encouraged to seek advice from their banks on managing cash flows and budget.
A lower pound sterling value will directly impact New Zealand companies that export to the UK. To prepare for any fluctuation in the pound, companies should value what their break-even exchange rate is and consider scenario planning.
Companies should consider:
- What are the cash flow implications to my company of volatility in the exchange rate?
- Does my business need to make any plans to mitigate this?
Some current contract terms and clauses may become redundant when the UK leaves the EU. New Zealand companies can begin to manage their risks by reviewing existing contracts that go beyond March 2019.
UK contracts that refer to EU law may require amendment or renegotiation. Businesses should review whether their contracts make references to the UK as a member state of the EU.
Reviewing contracts is an important step for financial and related professional services firms because of the high number of cross-border contracts they rely on.
When reviewing your contracts, companies are encouraged to consider:
- Do I have contracts with the EU or the UK? How many?
- Do these contracts go beyond March 2019?
- Do my contracts refer to the UK as a member of the EU?
- Is there a reference to an EU law in the contract that could become redundant following Brexit?
- Do I have contracts that rely on the free movement of goods and services between the UK and the EU?
The General Data Protection Regulation (GDPR) is an EU wide regulation on data protection and privacy for all individuals within the EU and the EEA. After Brexit, the UK will become a ‘third country’ under EU data protection rules.
New Zealand companies managing EU citizens personal data in the EU can transfer this to New Zealand without any additional precautions under our Data Adequacy Decision. However, additional protections may be needed to transfer personal data from the EU to the UK.
Companies should consider:
- Does my business require personal data to be transferred between the EU and the UK?
The UK Government has released guidance on how data will be protected if there is no deal.