How Brexit Is Changing Business – Forbes

Debate over what the consequences of a departure of the U.K. from the European Union would look like has been raging since before then British Prime Minister David Cameron called a referendum on what became known as Brexit in 2015.

Now that the U.K. has formally left the European Union and a trade deal between the two entities was struck in December, the consequences of this historic decision are no longer a matter of intellectual debate, but an everyday reality for millions of businesses and business leaders.

Forbes is tracking news of the tangible impact of Brexit on British and European businesses, and will keep updating this story.

The Netherlands Foreign Investment Agency (NFIA) has long been courting British companies, highlighting what the Low Countries have to offer businessesEnglish-friendly location, low corporate tax environment, and good connections to mainland Europe, among other factorsin sessions held in the U.K. in the run up to the end of the Brexit transition period.

There's been a surge in companies relocating or expanding to the Netherlands because of Brexit. (Photo by Romy Arroyo Fernandez/NurPhoto via Getty Images)

The agencys latest figures on the number of foreign companies that have made a home in the Netherlands attest to the success of those efforts. According to the NFIA, of the 218 companies who have set up office in the Netherlands due to Brexit since the 2016 referendum, 78 have done so in the past year. The agency says its talking to a further 550 companies considering a relocation or an expansion to the Netherlands.

One story that made headlines this week (February 11) was that Amsterdam has surpassed London as the continents top share trading center after seeing a fourfold increase in transactions between December and January, according to data from CBOE Europe first reported in the Financial Times.

British universities are projected to lose an estimated 62.5 million ($85.9 million) per year in tuition fees as a result of Brexit (Photo by Steve Parsons/PA Images via Getty Images)

Financial markets arent the only area where the U.K.s dominance is shrinking. British universities have a reputation for excellence across Europe, but they are projected to attract 35,000 fewer EU students a year, according to research from the London School of Economics, which estimated a loss of 62.5 million ($85.9 million) per year in tuition fees as a result of Brexit.

An exemplary story of how small businesses have been affected by Brexit is that of Sue Campbell, founder of Kind2, a small business selling shampoo and conditioner bars, who dropped off their first post-Brexit package to a courier firm on January 12incidentally, the day this column was first published.

But when Campbell spoke to Forbes contributor Catherine Erdly, nearly a month later, the package had yet to leave the U.K., a delay the tracking system attributed to Brexit, with no indication how or when it will reach its destination.

(Photo by Richard Baker / In Pictures via Getty Images Images)

Campbells story shows the urgency of small businesses demands for financial support, which included transition vouchers worth 3,000 and reviewing the tax and duty threshold so that it only applies to EU transactions over 1000.

The U.K. government announced this week 20 million ($28 million) in support of small businesses, including a grant of up to 2,000 to pay for support in importing and exporting.

getty

The impact of Brexit isnt just felt on business and travelers, but by professionals working in academic and research, too. The worst-case scenario for researchers, argues Forbes contributor Kath MacKay, has been avoidedbut the change of relationship between the U.K. and the EU has inevitably resulted in some losses.

An Eurostar train stands at the platform at Gare du Nord train station during the coronavirus (Covid-19) outbreak on January 22, 2021 in Paris, France. (Photo by Chesnot/Getty Images)

U.K. musicians vocally protested the British governments decision to prioritize limits to freedom of movement in their agreement with the EU, forcing any British act touring in the EU to obtain a visa to do soand this wasnt even the only issue related to travel to dominate the headlines.

The Eurostar train service is unsurprisingly struggling due to the fall in demand for travel as a result of the pandemic. At the time of its 25th birthday in 2019, the Eurostar delivered 11 million passengers to either shore of the channel. But now that financial support is needed, neither London nor Paris are keen to foot the bill.

Despite a three-month "grace period," in which supermarkets needn't comply with all EU certification requirements, shoppers on Northern Ireland are already seeing disruption as supermarkets grapple with the changes. (Photo by Charles McQuillan/Getty Images)

The issue of how to deliver a Brexit compatible with the Good Friday Agreement, which bans the introduction of border checks between Northern Ireland and the Republic of Ireland, was seemingly resolved by allowing Northern Ireland to remain part of the single market. In practice, this means that goods trade between Great Britain and Northern Ireland need to undergo custom checks. The consequences of this decision were on full display across a number of supermarkets in Northern Ireland last week, with many shelves resulting empty as food supplies deliveries were slowed, if not disrupted. U.K. Prime Minister Boris Johnson called it teething problems, but supermarket chains are concerned that, left unaddressed, the situation will only get worse.

U.K.-based websites can no longer use .eu domain (Photo credit should read GERARD CERLES/AFP via Getty Images)

Around 81,000 .eu website domains have been suspended as U.K.-based residents are no longer allowed to use the domain. The Leave.eu website, which campaigned for Brexit, has passed on the ownership of its domain to a non-U.K. resident in order to remain in business.

Made in Englandbut not for sale in the U.K., for now (Photo by Oli Scarff/Getty Images)

Brooks England has been producing bicycle saddles from its factory in Smethwick, West Midlands, since 1882but since January 1, it has suspended sales to the U.K. As its been owned by an Italian company since 2002, all its products go through the Italian logistics center before being dispatched around the world, and the new taxation regime for exporters to the U.K. has added red tape that companies are finding difficultor unprofitableto navigate.

The new customs facilities with "the agile border" put in place by France at the Eurotunnel site (Photo by Sylvain Lefevre/Getty Images)

New rules around trade come at a busy time for small businesses that have already had to adapt to government lockdownsbut while EU-based businesses may simply decide to, at least for now, avoid selling to the U.K., U.K. businesses face a more difficult choice giving up on a market as big as the EU. The government and professional organizations can provide support in getting acquainted with the new regulations.

Energy was one area which saw close cooperation between the U.K. and the EU (Photo by Justin TALLIS / AFP) (Photo by JUSTIN TALLIS/AFP via Getty Images)

The deal reached in December by the U.K. and the EU is not the final piece of the Brexit puzzle when it comes to energy trade. By April 2022, both sides must develop new trading arrangements to govern the trade in power and gas conducted through interconnectors beneath the English Channel. The U.K. is a net importer of electricity, obtaining some 10% of its power through interconnectors linked to France and other EU nations.

See the rest here:

How Brexit Is Changing Business - Forbes