How can companies prepare for the end of the transition period?
During the transition period, the UK will continue to participate in the EU single market and in the Customs Union as if it were a Member State. During the transition period, the EU and the UK will negotiate an agreement on their future relationship, which will determine, for instance, the terms and conditions for trade and investments once the transition period has ended.
Even if the EU and the UK succeed in reaching an ambitious agreement on their future relationship, the end of the transition period and the UK’s withdrawal from the single market and the Customs Union will inevitably mean significant changes for companies and the authorities compared to the current situation.
It is also possible that the EU and the UK will not have time to reach an agreement on trade and investment issues. It is therefore necessary to prepare for a scenario in which trade will take place under the terms of international agreements, including those of the WTO.
The end of the transition period will affect, among others, companies that:
- are engaged in import, export or investment activities with the UK, or
- use content that originates from the UK in their production, such as raw materials or services, including cloud computing.
How these changes will affect an individual company depends on factors such as the company’s field of activity, location and position in the production chain. Below are some examples of changes that may result from the end of the transition period. Further information will be provided later as the negotiations proceed.