Discussions have been ongoing between European Union countries and the UK for approximately four years. However, it is still unclear how the two will break up after just two months.

This is difficult for companies that trade with England (United Kingdom). In the event of a so-called soft Brexit, that is, with a trade deal, certain agreements will be made regarding the conditions under which companies can import or export products from 2021.

Hard Brexit?

Without a trade deal, a hard Brexit, much less favorable World Trade Organization (WTO) regulations will apply, including higher import duties.

British Prime Minister Boris Johnson threatened recently again with WTO rules. “A difficult Brexit, I don’t think anyone expected that,” said Hans Biesheuvel, founder and director of Ondernemend Nederland, which defends the interests of SMEs in the Netherlands.

Preparing for what?

It makes sense that companies are also thinking about other things in recent months due to the coronavirus crisis, said Kees Bakhuis, a spokesman for the employers’ organization VNO-NCW. However, he believes it would be good if we also focus on Brexit.

“However, it is useful if you know what to prepare for,” he said.

‘Don’t worry about big companies’

Biesheuvel doesn’t care much about big companies. “They can arm themselves better than small companies, they have the power to regulate their systems,” Biesheuvel said.

However, the most important thing is whether the company already has experience with international business, he said. Bieshuvel worries that smaller companies in particular will find it more difficult to trade under less favorable conditions with more regulations.

Worst case scenario

The worst-case scenario is no trade deal. Companies that have done business with other countries that don’t yet have trade deals know how to deal with this, added Birgit Oosterhuis, spokesperson for the Dutch Companies Agency.

“You have to do it all once to find out.”

Postpone

Concretely, if there is no trade deal, companies will experience delays at the border, while they will also face higher import duties, according to Biesheuvel.

But there’s more to it than that, he points out. For example, standards regarding, among other things, product and service quality may differ.

Perhaps companies should produce them separately for the UK, as food, for example, may not contain slightly different ingredients. That would make it more expensive to manufacture such products, Biesheuvel thinks.