11 Dec 2017

BREXIT - The Digital Tech Sector Priorities and Gap Analysis in a EU-UK cliff-edge scenario

BREXIT - The Digital Tech Sector Priorities and Gap Analysis in a EU-UK cliff-edge scenario

INTRODUCTION

Following the start of the BREXIT negotiations, DIGITALEUROPE welcomes the opportunity to provide input where the key areas of concern lie for the tech sector.

Our members are keen to provide our extensive expertise of navigating global supply chains, customs systems and regulatory frameworks to mitigate the damaging effect of the imposition of a ‘hard border’ to the greatest extent possible.

The tech sector’s key concerns are centred around the risk of non-tariff barriers being introduced. While most IT goods are low or zero rated for tariffs, issue such as increased documentation requirements, customs delays, future regulatory divergence, lack of free flow of data and access to highly skilled talent all risk having significant negative impacts on the sector. To minimise risk and disruption as much as possible, DIGITALEUROPE strongly encourages the EU and the UK to move to the discussions on the future trading relationship between the European Union and the United Kingdom as early as possible in the negotiations around the UK’s secession from the Union.

We also believe that a transitional arrangement of adequate duration will be essential. The transition should provide sufficient lead time for business to implement the system and process changes required under the future UK / EU trade terms. Any cliff edge would risk serious disruption to business, leading to significant operational and financial challenges as well as impacting on the ability to deliver service levels expected by customers.

In limiting disruption, a transitional deal should not require a ‘two step’ approach whereby businesses have to adapt to a transition environment before adapting to the circumstances of any final deal. Therefore, the transitional period should be based on the UK continuing to be part of both the Single Market and the Customs Union for an interim period.

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