We are still uncertain about the eventual post-Brexit landscape. It is unclear for how long this is likely to continue. The withdrawal is likely to have a significant impact on commercial contracts between UK and EU businesses. It is therefore wise to look into ways of including some provisions to allow parties to re-negotiate contractual terms post-Brexit.
The following areas are most likely to be affected by Brexit:
- Delays at ports as a result of the potential re-introduction of customs checks for goods travelling between the UK and the EU could make it difficult for a UK supplier to meet delivery terms that it may have committed to under a supply contract with an EU based customer.
- An EU-based supplier to a UK manufacturer which had committed to paying all costs associated with the supply to the manufacturer could be faced with a significant increase in costs as a result of the re-introduction of tariffs on goods travelling between the EU and the UK. This could make it unprofitable for the supplier.
- Currency fluctuations could have a major impact on the performance of contracts between parties in the UK and EU and may render the contracts commercially unviable.
Therefore, please do not rely on existing contracts and consider a Brexit clause which would allow you to renegotiate the terms of the existing contract once the landscape becomes known.