British Divorce Must Not Affect Companies

Although many still don’t believe it to be true, Brexit is happening. Current British Prime Minister Theresa May triggered the famous Article 50 of the Treaty on European Union on 29 March by sending the letter to the European Council President Donald Tusk. This step officially starts the process of the United Kingdom leaving the EU and both parties have to decide what kind of relationship they want to establish.

The negotiations will be twofold; firstly it will be necessary to negotiate the “divorce” conditions of the UK leaving the EU and secondly, the deal setting up future relationship of the two – the so-called free trade agreement (FTA). During the early discussions after triggering the article 50, the United Kingdom expressed its interest to negotiate an FTA that would be larger and more important than any other FTA of the EU so far, covering all the key sectors, including financial sector. The United Kingdom is one of the most important markets of the EU and therefore it is clear that mainly European companies are worried about the future relationship. Therefore Czech, as well as European business organizations call on the EU and UK representatives to negotiate such conditions that will ensure smooth transition from current status to new reality.

Czech business organizations support setting up the closest economic relationship possible, without creating unnecessary and burdensome trade barriers. Free trade between the two is the utmost priority while safeguarding the integrity of the internal market. Also, negative impacts of Brexit on citizens and companies must be limited.

Last but not least, establishing legal certainty is key for both EU companies in the UK and UK companies in the EU to continue with their business as usual as soon as possible. During a special summit of the European Council on 29th of April focused purely on Brexit, EU27 agreed that UK should remain a close partner of the EU and one of the key priorities for negotiations is to maintain the integrity of the single market. The unanimous adoption of European Council guidelines following the United Kingdom’s notification under Article 50 is a positive initial signal and a first step, but let’s see what will the negotiations bring.