Is your business prepared for Brexit?

We know that the uncertainty about Brexit has made it difficult to know how to prepare, and that as the deadline approaches and things remain unclear, it's easy to bury your head in the sand. But the countdown to Brexit is on and it's time to get ready and put practical steps in place to make sure your business is ready for 31st October 2019.

Our team of expert advisors can provide bespoke assessments of your business and the areas where your business might be affected by Brexit. providing personalised practical plans to ensure your business is ready for when Britain leaves the EU.

You can start by taking our Brexit checklist quiz to see how your business could be affected by the changes. You can also request a call back from one of our Brexit Advisors to help you work through exactly what your business should be doing to prepare for Brexit right now.

Below you are able to download our FBCMB regional tube maps, where you can find your sector line and see the issues that will affect you on each stop. You will travel through zones covering international standards, EU rules, opportunities, people and trade. On each step of this journey you will need advice and our team are on hand to provide it.

 

The big questions are; how will you do business in the short term in the event of no deal? In the medium term during any transitional period between Brexit and the entry into force of a new UK-EU trade agreement? And in the long term under the new trade agreement?

It is already clear, however, that you or those you supply are not going to enjoy the same access to the EU's Single Market under a trade agreement as you do while the UK is a member of the EU.

The main threat you face is uncertainty about the outcome. Nonetheless, you need to assess the impact of a worst-case-scenario Brexit now, in other words without any withdrawal agreement in place, and have in place contingency plans which are flexible enough to respond to developments in the negotiations.

Download our briefings if you are in:

Agriculture

Sheep Farming

Manufacturing

Automotive

Leisure and Hospitality

Our team can help you with all that you need in four steps:

  1. Information - You need to have procedures in place to ensure you are well-informed about the Brexit process. Relying on press reports won’t be enough. Understanding and forecasting the likely impacts are fundamental to your Brexit strategy to gaining early competitive advantage. FBC Manby Bowdler will give you with a tailored service which monitors progress, analyses published documents, and identifies the impacts for your business the moment they become clear.

  2. Preparation - Prepare for Brexit with and without a deal. To do so, businesses should carry out a Brexit legal impact assessment followed by a Brexit commercial impact assessment. These will form the baseline of any contingency measures. To be Brexitproof, FBC Manby Bowdler’s online survey can help you legally and commercially.

  3. Action - Based on this survey, you should decide what contingency plans you need and when they should be activated. You might be marginally or massively impacted. Contingency measures could include setting up alternative supply chains, identifying new customer markets, or re-skilling employees. FBC Manby Bowdler has been at the forefront of advising clients on the commercial implications of Brexit. We have the experience to help you devise and implement contingency measures for your business, and stress-test them against a range of Brexit scenarios, whatever industry you operate in.

  4. Influencing - The best way to avoid a Brexit that damages your business is to influence the outcome yourself. Brexit provides an opportunity to do that, which businesses should exploit more. FBC Manby Bowdler has the benefit of advisers in Brussels and London. We can devise and implement policy advocacy strategies to influence the course of further Brexit negotiations, the negotiations on a new trade agreement and build long-term regulatory compliance strategies, including relationship-building with key influencers and government authorities.

Our team of experienced sector specialists has examined the potential impact of Brexit in your sector. Peter Wilding, our Brexit Director, is able to provide in-depth analysis on the political, policy and legal implications of Brexit, and translate what they mean for manufacturing, agricultural and hospitality clients. He has an expert understanding of how each piece of the jigsaw of EU policy and legislation fits together, an insider’s knowledge of the political and administrative processes of the negotiations, and considerable experience of how UK legislation is enacted. Few other lawyers have a background so suited to giving Brexit advice.

Brexit: Sheep Farming Briefing

21/02/2019

Brexit Director Peter Wilding looks at the major issues facing sheep farming as the EU withdrawal deadline looms and says a no deal Brexit would be the biggest upheaval to the industry in almost 200 years.

Sheep have always been at the centre of Shropshire’s farming. Today a third of Britain’s sheep graze within 100 miles of the centre of the county. Shropshire has the second highest amount of sheep in the country after Northumberland. Recently, The Economist published an article reporting how sheep farmers on AE Houseman’s blue remembered hills might, with Brexit, end up living in a land of lost content.

Because Shropshire is also Brexit country. Some 57% voted to leave. Four of the county’s five MPs are pro-Brexit. Yet Brexit represents the biggest potential upset to Shropshire’s rural life. No other industry is going to feel the impact quite as keenly as British sheep farmers. Unless there is a deal which maintains subsidies, continues compliance regimes and enables untroubled exports and imports, it will represent the biggest upheaval for farming since the repeal of the Corn Laws in 1846.

Not that you would notice. To politicians, farmers are pretty much an irrelevance — after all, 80 per cent of voters live in towns and cities.

Farming is less than 1% of the British economy. But, with food processing included, it makes up 13% of GDP, making it an industry bigger than cars and aerospace put together.

Nor are sheep farmers a small part of the market. The UK is the largest producer of sheep and goat meat in the European Union, contributing 40% of all meat production. Typically, 64% of UK production is consumed domestically and 36% is exported. We are also big sheep importers, bringing in more sheep meat and offal than we export due to the seasonality of lamb. 89% of it is fresh and frozen sheep meat originating from Australia and New Zealand, whose seasons are opposite to ours.
In a no deal scenario, sheep producers would effectively face a triple whammy of zero-tariff lamb imports, tariffs of up to 60% on some exports and a major change in subsidies.

Subsidies

An average of 55% of farm income comes from the EU’s common agriculture policy and its subsidies. In the long run, farmers will receive money to make improvements to the environment under a new system post-Brexit. Until then, the current £1bn sum paid to sheep farmers and landowners will continue until 2022 - longer than the Government had previously pledged.

If there is no deal, sheep farmers have been assured of financial support from the government. This support is likely to be similar to the old variable premium scheme. This paid farmers the difference between an average price of lamb set over a number of reference years and the current market value.

Details are expected to be finalised between now and 29 March, and it is hoped the scheme will be ready to operate in the event of the UK crashing out of the EU without a withdrawal agreement in place. However, support would be on a temporary basis until a trading relationship with the EU had been re-established

Exports

Subsidies will be needed because, as one sheep farmer says “without an EU trade deal, all sheep farmers will go bankrupt.” Without a deal, there will be very little access for lamb without a tariff. The UK will need to apply to the EU for “third country status”, which is the designation all non-EU countries need to have to send goods into any EU country.

It is unclear how long this could take, with the process normally taking several months.
The current effective tariff rate of chilled lamb entering the EU is 46%, which is based on a charge of 12.8% of the value of the shipment plus an additional €171.30 per 100kg.

The Agriculture and Horticulture Development Board says that lack of access to the UK’s largest trading destination for sheep meat will cause flock owners to cull sheep numbers as they become increasingly unprofitable. The AHDB has warned that sheep farmers will suffer a devastating 30% cut to the value of lamb if the UK leaves the EU without a withdrawal agreement. At current prices, that would slash the value of a 40kg lamb by about £23, as tens of thousands of tonnes of unwanted lamb, previously destined for the EU, drags down the value of the UK market. Last week, Liberal Democrat leader Vince Cable suggested in Westminster that he has seen internal Defra documents that explore the need to cull one-third of sheep in the UK to stabilise prices in the event of a no-deal Brexit.

However, whilst government support would ensure the industry would not significantly contract in size – causing damage to the UK’s long-term objective of tapping into lucrative export markets in the USA, India and China – there are currently no facilities to enable sheep to be stored and frozen – a necessity for long distance export markets. This means the industry would still be reliant on consumers responding to falling prices at the shops by increasing consumption and avoiding lamb going to waste.

Imports

The sheep sector would be among those most affected if the government unilaterally opened the UK market to tariff-free imports. Even if that did not occur, all animal products entering the EU would have to pass through a veterinary inspection post. Importing pesticides, medicines, seeds and fertilisers would also face new regimes. For example, mutual recognition of veterinary medicines would cease immediately. Import controls on animal feeds would start within a new notification regime because the UK will no longer have access to the EU import system.

Even sheep farmers stockpiling feed now will have to ensure stores meet assurance scheme requirements. So, a no-deal Brexit could affect availability of animal health products in both in the short-term and long term. This could present supply problems and real risks to livestock health and welfare.

Conclusion

The Economist suggested that some may say Brexit is positive as it would break Shropshire employers’ habit of relying on cheap imported labour rather than mechanisation, end their fixation on the EU rather the world, and stop slaughtering sheep instead of exploiting the county’s natural beauty.

But automating sheep slaughter will not be cost-effective. The global market will force sheep farmers to battle cheaper frozen Australian, American and New Zealand lamb. And new subsidies for stewardship of the countryside rather than sheep grazing would mean that the Shropshire hills could end up as farm-free scrubland.

For sheep farmers, it is time to get informed, prepare yourselves, protect your business and influence the legal environment you will soon have to work in.

Here at FBC Manby Bowdler we have a stellar team of experts who can help you take control of your business whatever the politicians decide.

If you would like to contact Peter Wilding to discuss any of the above please contact him on 01694 724440, 07901 008220 or email peter.wilding@fbcmb.co.uk.


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