Wednesday, January 16, 2019

Brexit: Where Do We Go From Here?

Patrick King, Partner at Baker Tilly International's UK member firm MHA MacIntrye Hudson looks at where next on Brexit

The result in the UK parliament’s vote last night on Theresa May’s Brexit deal went pretty much as expected with the government being roundly defeated. There was no surprise here although the scale of the defeat was perhaps larger than the cabinet anticipated. So the question now is, “where do we go from here?”.

The EU team have made initial noises suggesting there can be no more concessions and Donald Tusk has suggested we should perhaps revoke Brexit. The government remains committed to delivering on the result of the referendum and so, for now at least the direction remains very much, “find a deal that parliament can accept or crash out with no deal”...or does it?

While parliament has so far said resoundingly what it does not want, it has not really given any clues as to what it does want (and this is the government’s problem). Having said that, what can be deduced is that parliament seems overwhelmingly against a no deal Brexit. My view, for what it is worth (and this is certainly now being talked about) is that Article 50 is likely to be revoked (temporarily at least) to allow more time for negotiations and it must then be a possibility that over time the government (whether the existing one or a new one) will move towards a position where they feel able to remain within the EU, perhaps after some concessions to address key UK concerns.

But this is all speculation for now and what remains certain is that the uncertainty will continue meaning that businesses should continue to plan for worst case scenarios and make their plans to deal with these. Whatever happens, as ever, businesses that are best prepared and able to move quickest will benefit the most (or suffer the least).

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