A sitrep on Brexit as of 5p.m. GMT on Friday 25 October:
Legally speaking, the UK is still set to leave the EU in 6 days time, on Thursday 31 October, on a ‘no-deal’ basis (cliff edge exit, immediately trading with the EU as a third country on WTO terms).
To avoid such a no-deal Brexit on 31 October, the UK government has (against its will and under a legal obligation imposed by Parliament) asked the EU for an extension to the Brexit deadline.
EU leaders are currently considering this request. They have indicated they are minded to agree to an extension but they have yet to confirm this and there is ongoing debate about the duration of extension they offer.
Until EU leaders formally agree and extension and the UK (Government and Parliament) agree to this, business should remain on alert for no-deal on 31 October.
An extension is the most likely outcome: further delay and potentially creating another deal or no-deal deadline. Business will therefore need to continue to maintain no-deal plans. This will place an increasing strain on cashflow for some businesses and ongoing investment limbo.
In other words: it looks like no Brexit on 31 October , but the uncertainty and no-deal prep of the last year will continue for a while longer….
Boris Johnson, the UK Prime Minister, has put on hold the process of ratifying the Brexit deal agreed with EU leaders last week: he has said he will pause the legislation needed for this unless and until MPs agree to have an election.
MPs will vote on Monday on a proposal to hold a pre-Christmas election on 12 December. It is not clear whether or not this will be agreed – the Labour party is taking an equivocal position at the moment.
We can foresee a continuing period of uncertainty in the UK for the next two months – with Brexit and an election pending. My advice to business is:
- maintain no-deal plans; and
- focus on actions that will strengthen agility and resilience: cash and cost management, attracting skills and talent, and exploring new markets.
For further support and information on how we can help: www.grantthornton.co.uk/brexit
it looks like no Brexit on 31 October , but the uncertainty and no-deal prep of the last year will continue for a while longer….