The British government has published a series of papers advising businesses on how to protect themselves from the potential disruption of a "no-deal" break with the European Union (E.U.) when the United Kingdom leaves the bloc next March.
The papers, which provide advice on everything from stockpiling drugs to new paperwork for trade, say that British firms could face a tangle of red tape, possible border delays and cashflow disruptions if the government is unable to negotiate an exit deal with the E.U. in Brussels before Britain exits the bloc. Britain has yet to reach a divorce agreement with the E.U. ahead of March 29, when it is set to leave the bloc.
Prime Minister Theresa May's plan for a "business-friendly" deal has failed to impress negotiators in Brussels and has been heavily criticized at home. Nevertheless, both sides maintain they are aiming to reach a deal in time.
However, the British government's published guidance makes it clear that companies trading with Europe would face new paperwork to cover customs and safety declarations in the event of no deal, paperwork that is currently not required.
Businesses would also have to apply the same customs and excise rules to goods moving between Britain and the EU as currently apply when goods move between Britain and a country outside he EU. Value Added Tax (VAT) could also be required to be paid up front.
In total, around 80 technical notices are expected over the coming weeks. They will be closely scrutinized by industry to see how well-prepared Britain is for an outcome many employers have warned will be hugely disruptive. The government has maintained throughout the negotiation process that it is preparing for all possible outcomes, including 'no deal'.
Many economists say failure to agree exit terms would seriously damage the world's fifth largest economy as trade with the E.U., Britain's largest market, would become subject to tariffs.
