The start of the 2020 year is the crucial moment for most British traders and their partners as well. The 31st of January became the beginning of a new era – the Brexit-based trading. The leading business-oriented company in the United Kingdom, Deloitte, has run the comprehensive research concerning Brexit implications for the technology sector. All risks, changes and other key factors were taken into account. According to the results of due-depth analysis and investigations made by the team of experts, business representatives should plan their trading activities correctly to avoid different risks and blowbacks.
What is the technology sector for Great Britain?
The UK economy depends on the technology sector much. It means that the budget replenishment done by the technology range of industries is enormous in comparison with other spheres of actions. Additionally, highly-developed technologies and cutting-edge solutions are the principal way to become an advanced country in the world.
Such a decision as to leave the eurozone has a direct impact on the activity arrangements in the conduct of the technology sector. The constant development of new technology-based solutions requires well-built data and workflow management to stimulate innovations in the UK. By the way, the British government explains its Brexit decision as follows – to become opinion shaper, having put Great Britain at the forefront of AI-based technology, digital products and data revolution (refer to the UK White Paper).
But all extensive plans should be paired with the same big deals. Most business representatives whose trading activities are related to the technology sector do not know how to optimize their activities for the rapid Brexit adaptation. Besides the UK policy paper and announced Digital Services Tax, there is still a lack of information. Deloitte experts have prepared a detailed review to simplify Brexit-based planning for market players.
#1 Data flows
The UK technology sector can face with the range of EU issues because of the permanent data flow required for their digital services delivery. European Union controls personal data flows and regulates the level of protection of the information.
It is worth noting that the European Union has not matched the statement concerning personal data protection indicated by the Information Commissioner’s Office. It means that business representatives should make arrangements for specified legal safeguards in order to ensure the high-quality data flows required for the optimal planning of trading activities.
# 2 Human resources
Great Britain realizes that all EU workers who were formed technology staff of any UK-based corporation should pass the qualification procedure. It means that Brexit allows the UK to specify the range of tech skills for EU newcomers. That is why it is rational to run an improved recruitment strategy preliminary not to face the lack of human resources (new immigration system forbids the free movement of EU workers on the whole territory of the United Kingdom). The main purpose of technology-oriented companies is to form their workforce and follow work permit requirements third-party countries provide for non-EU residents (the British government provides for non-UK nationals).
#3 Intellectual property
There is one notable aspect relating to intellectual property to take into consideration. Those companies that aspire to become UK-specific ones should run reincorporation according to registered and unregistered Community design rights. All tech-based corporations need to perform their activities according to the UK IP regulations and monitor information about intellectual property legal orders affected by Brexit. It is recommended to check the regulatory environment for legal representatives of the companies of the UK tech segment. Additionally, the UPC jurisdiction should be taken into account – the UK traders have to change euro-zone patent applications timely.
#4 Euro-zone Investments
The representatives of the UK technology sector should note that the EIB (European Investment Bank) does not deal with UK-based clients. It means that all euro-zone bids will be considered as third-country ones. UK-based market players should monitor new regulation introduction relating to investment activities during the 11-month transition period.
#5 Supply chain & Commercial contracts
The technology sector is notable with digital services domination. Nevertheless, tech goods are also bought and sold on the territory of Great Britain. That is why supply chain risks are not the exception of tech markets. As the regulatory regime with Brexit may change, business representatives need to complete import/export issues and submit updated trade terms timely.
Changeovers will touch commercial contracts – both pricing structure and payment terms will modify paired with other necessary aspects. It is recommended to plan the Brexit-oriented restructuring process as soon as possible.
To sum up
As can be seen, most all components of business relationships and operating processes the UK tech-related companies have had before are going to be changed. Brexit has a direct impact on IP protection, staff forming exports & imports, and other market capabilities. It is necessary to keep informed about new regulations to stand at the top of the tech players’ list. Drawing on the huge experience and the UK technology insights, Deloitte specialists are ready to help with Brexit-based business planning!