British businesses fear for exit negotiations
British businesses are most fearful of not having their voices heard when Britain begins to negotiate its exit from the European Union (EU) – over a third (35%) of those surveyed by law firm Berwin Leighton Paisner (BLP) cited this as their highest concern following the leave decision.
International law firm BLP surveyed a sample of leading banking, finance, real estate and other business leaders who attended a major event in the City of London, “Brexit, what happens next?”, last Thursday (7 July 2016). The two other main concerns for businesses were a restriction on the movement of high quality talent (29%) and the amount of time in stasis until Article 50 is invoked (27%). Interestingly, businesses were not so concerned with US competitors having an advantage in acquiring UK businesses, given the devaluation of the sterling, with just 2.5% citing this as a cause for concern.
When it comes to measures being put in place in the immediate aftermath of the vote to leave the EU over half of those surveyed (51%) have been contacting clients to discuss issues and offer reassurance. The next most applied action (over 42% of respondents) that businesses have put in is that of reviewing all active and forthcoming deals and transactions. Interestingly, over a quarter of companies (28%) have set up a Brexit Taskforce to help navigate their business and/or clients through the upcoming issues. When it comes to what businesses think will happen next, over a quarter of companies (26%) predict they will put deals on hold and a further 18% are currently considering moving offices out of the UK.
Chris Bryant, an Antitrust and Competition Partner at BLP, commented: “It goes without saying that the UK’s decision to vote to leave the EU has hit the business community hard and our survey results further corroborate that feeling. There is a general sense of unease and worry across all sectors and a lack of understanding of how best to deal with the current situation.
“However the main message is to the UK Government. Businesses are clearly extremely worried as to what will happen during the exit negotiations and what this will mean for trade into and out of the UK. As the horizon remains unclear in the short term, businesses are clearly demanding a strong and forceful representation at the exit discussions to help secure the best deal for the UK for the short and longer term future.”
Other key findings include:
- Almost a quarter of respondents (24%) are looking at alternative countries to the UK for investments
- A third of companies (33%) are reviewing all investments
- The decision to leave the EU, leading to the UK being perceived as a poorer destination for foreign investment, is a top concern for 24% of businesses