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Preparing for Brexit 

It is less than 5 months until Brexit and the Article 50 deadline on 29 March 2019, and whilst rumours abound of deals, unfortunately – from a business perspective – the spectre of a non-orderly withdrawal outcome remains fully in view. With a few exceptions, it is a wide and deep business consensus that such a no-deal outcome would be an extremely disruptive negative outcome for economic operators on both sides of the Channel. It’s worth repeating – from a business perspective – no deal is the worst deal for everyone.

If there is no withdrawal deal, one might hope there will be side deals covering key issues such as aviation or data, but this cannot be guaranteed, particularly if negotiations break down badly. Consequences will be unpredictable, both politically and economically.

Irrespective of that, we can expect significant disruption at all UK/EU borders – notably with France, Belgium, the Netherlands and in main airports. This is a simple function of the UK leaving the Customs Union and the Single Market without a ready replacement legal framework and with the systems developed to take over.

The situation of the Irish Border in the case of no deal is also unclear – both sides have committed to no ‘hard border’, though both sides may have legal obligations under both EU law in the case of Ireland, and under the WTO in the case of the UK to undertake customs and regulatory checks. Once the UK has left the EU Customs Union and Single Market, there will have to be checks and formalities for goods, the only question is where these checks will take place and exactly what formalities will be applicable.

Preparedness notices from both the EU and the UK Government have flagged the respective legal provisions at the moment of the UK leaving the EU, but do not give a clear roadmap for affected businesses in the case of a collapse of the withdrawal negotiations or a non-ratification by the respective parliaments.

At a minimum, companies should be looking at the potential impact on their supply chains of a potential raising of regulatory and customs barriers, possible queues on both sides of the border as new systems and formalities are introduced, as well as the possible restriction of freedom of movement for staff. On a sector by sector basis, the cessation of regulatory arrangement and licensing may also create new barriers to market.

The British Chamber of Commerce | EU & Belgium will stay close to the UK Government, the EU institutions and the Belgian Authorities during this challenging period. We are the go to organisation that authorities are asking for feedback from on business concerns. Get in touch, use our platform and share your concerns, specific or otherwise so that we can get them to the right people.

Matt Hinde, Fleishman Hillard, and Morten Petersen, EPPA, Co-Chairs of the Future Relations Committee

If you have more questions about the prospect of a no deal Brexit, you can find more information on our website page – What to do if there is no deal?

Our next Brexit event – Brexit and Future Relations – An Update on the Irish Perspective – will take place on the 20th November. You can find more information on our website.

 

 

Like every autumn in Brussels, this one didn’t disappoint with regard to its packed schedule, and we would like to believe that we didn’t either!

We kicked off with the discussion on Cartel Enforcement: Current Practice and Updates where we learned that since February 2018, companies breaching antitrust regulations by taking part in cartels has resulted in hundreds of million in fines, while ¾ of cartel cases originate from leniency applications.

On a different note, Kate Kalutkiewicz updated our members on the state of play with regard to EU-US Trade Deals. A special emphasis was put on China and the current state of trade relations with the US, as an increasing threat of a trade war looms between both countries, plus we discussed the reform of the Dispute Settlement System in the WTO and the view of the US on the Mutual Recognition Agreements (MRA). More specific trade sectors were also examined, such as chemicals, aluminium and car company regulations.

We also hosted a panel debate on eHealth – Engendering Health Systems’ Sustainability. The positive impact that eHealth can have on EU member States’ Health Systems was stressed throughout the discussion between the panellists and the participants. A wider implementation of digital health across the EU would allow, amongst others, tremendous savings resulting from the use of mobile health applications. A better pooling of data at the EU level would also have huge benefits, reducing for instance the time to diagnose rare disease. The main issue in this field arises from data privacy, record linkage and a lack of incentives from both doctors and governments to use digital technologies.

Under the Future Relations Committee, the chamber organised three events, starting with the roundtable debate with legal industry and the UK Justice Minister on EU-UK Civil Judicial Cooperation, Lucy Frazer. At this event we had the opportunity to discuss how the UK’s withdrawal from the EU has created many legal complications due to the intertwining of UK and EU law. It can be seen as one of the largest areas to negotiate in the agreement as companies wish for the legal protection to remain consistent, or at least to have a large enough transition period so that the adjustment is smooth. The second event saw Philip Rycroft, DExEU Permanent Secretary, give an Update of the UK EU Exit planning process, and finally we hosted the UK Ambassador to Belgium, Alison Rose, who updated us on the current situation in the negotiation process.

Our last event in September was organised with our members Digital Together, who took part in the workshop Digital Movers and Consumers. The objective was to initiate the creation of a dialogue between digital businesses, non-digital businesses, consumer associations, policy makers and other stakeholders to ensure that all viewpoints are shared to help formulate appropriate future regulation and legislation in the digital space in Europe.

Just two days before a crucial Parliamentary vote, we hosted a debate on Single Use Plastics , where many concerns and issues for industry were raised, in particular the issue on the Extended Producer Responsibility (EPR) and its lack of clarity.

Our FDI Screening Mechanisms event kept our members informed, helping us to understand that the EU has no single Foreign Direct Investment (FDI) screening mechanism, but several states in the EU have their own screening mechanism, which are strongly related to national security.

Finally, to finish the month of October, we organised a discussion on eCommerce after Coty and beyond, during which we heard about the Coty decision, which saw the European Court of Justice (ECJ) ruling that luxury good suppliers may prohibit the online sale of their goods by authorised retailers on third-party platform (such as Amazon) – a fascinating example of the intricacy of the enforcement of e-commerce rules.

If you want to learn more about our events, please visit our website, read our detailed event reports or join us at one in the future.

Bernada Cunj

Head of EU Events and Policy

The British Chamber of Commerce | EU & Belgium

On Thursday 25th October, the British Chamber’s CEO Glenn Vaughan met with Brexit Secretary Dominic Raab for a landmark meeting alongside representatives from chambers across Europe. Glenn shares his thoughts following the meeting:

glenn raab

There’s no certainty – but more clarity and confidence can be built

Last Thursday I was part of a delegation of national chambers of commerce that met Secretary of State, Dominic Raab, Brexit Minister Robin Walker and the top officials from his department. Countries represented were Germany, France, Ireland, the Netherlands, Belgium and Denmark – as well as Britain.

The message from our own members was supported by detail from our expert Future Relations Committee, and echoed loudly by national chambers representing 70% of all EU-UK trade:

  • No-deal is not an option – for either side. It would create very severe disruption for everyone.
  • When a withdrawal agreement is finalised, the next phase of negotiations must proceed quickly. There’s no room for a leisurely go-slow while the EU manages its institutional changeover or London lines up its ducks.
  • Regulatory alignment is extremely important if we are to get close to ‘frictionless trade’ in a future agreement.

The need for certainty underlies everything we have to say, but right now it is a long way off. Each new piece of progress only reveals the next cause of uncertainty. An agreement at a hoped for November European summit will need to be approved, especially in the UK parliament.  Once a withdrawal agreement is sealed, that’s the point from which we can start to work towards clarity – step by step.

We expect both the UK and the EU to take that opportunity to specify a clear destination and make clear and practical steps towards it, building confidence as they go. Another period of putting off decisions, until the next cliff edge is reached, is no good for anyone.

This blog piece on the importance of honouring Black Europe was written by guest writers from ENAR

21 May is World Day for Cultural Diversity. Yet the European institutions are still struggling to include the estimated 60 million ethnic and religious minorities living in the European Union, even though they are based in Brussels, a cosmopolitan city where 182 nationalities coexist.

It is therefore fitting that this day comes just a few days after the EU hosted its first ever People of African Descent Week in the European Parliament, co-organised by the European Parliament Anti-Racism and Diversity Intergroup, the Transatlantic Minority Political Leadership Conference, the European Network Against Racism (ENAR) and Each One Teach One (EOTO). This landmark event titled Honouring Black Europe, was dedicated to the Black European experience; the contributions Black people have made in Europe now and throughout history, but also the ongoing realities of racism, discrimination and violence they face.

There are an estimated 15-20 million people of African descent in Europe and a significant number of Black people have lived in Europe for centuries. This population is heterogeneous and diverse and so are their life realities and experiences, which remain very often invisible.

This week therefore aimed to raise awareness of the history and contributions of Europe’s Black population, in particular in light of the current United Nations International Decade for people of African descent (2015-2024).

Yet these contributions are very seldom recognised and valued – whether it is in media and political discourses or in education curriculum and cultural life. For instance, following World War II, citizens of the British Empire from the Caribbean travelled to the United Kingdom as part of the ‘Windrush Generation’. They became nurses, doctors, teachers, manual workers, cleaners, and drivers and helped to rebuild post-war Britain, contributions which remain unacknowledged today. There have been Black people living and making history in Germany for over 300 years, such as famous Afro-German poet, activist and educator May Ayim. When Black activists – especially women – are visible and vocal, they are exposed to critical levels of orchestrated hatred, such as journalist Rokhaya Diallo in France.

In a context where Black people experience some of the highest rates of discrimination in Europe, valuing these contributions but also recognising Afrophobia – or anti-Black racism – as a specific and structural form of racism is crucial.

In particular, European countries must acknowledge the legacy of the slave trade and colonialism, which led to deeply rooted stereotypes about Black people. These prejudices continue to this day and feed into the collective imagination and traditions such as blackfacing celebrations in several European countries.

Raising awareness of this history starts at school, by better including the teaching of the history of people of African descent in curricula, with a focus on their important contribution to European societies, and removing racist and inaccurate depictions in textbooks. States should also organise events, days of actions (e.g. Black History Month), documentaries, exhibitions at museums and cultural institutions, to promote and increase knowldege on Black history in Europe, and the cultures and heritages of people of African descent. European States should also take steps towards official recognition of histories of enslavement and colonialism and their profound and continuing effect on people of African descent. Such recognition could come in the form of e.g. memorial sites, museums, official apologies to actively contribute to restoring the dignity of victims and their descendants.

In order to truly ‘Honour Black Europe’, the European Union and national governments must recognise racism against Black people as a specific form of racism and address disparities in access to education and employment, increasing levels of hate crime, and violence and discrimination in the criminal justice system.

It’s high time Black people and other people of colour in Europe can be fully part of our society – politically, economically, socially and culturally – and of a shared future where diversity and equal rights are celebrated.

Ron Aston, Chairman of Interview

Ron Aston is the chairman of the Wednesday Club. The Wednesday Club is an English speaking social club open to elderly people of all nationalities. The club meets on the first and third Wednesday of the month. It was created with the aim of combatting the prevalence of loneliness amongst the elderly. The Wednesday Club is one of the Corporate Social Responsibility charities affiliated with the British Chamber.

When and how did you first hear about the Wednesday Club?

I heard about it through a friend. It began with Dr Lydia Jones, an English doctor in Belgium who realised all of her older patients were only seeing her from month to month. The doctor approached a friend, Deborah, a warden of the then Scandinavian church. She enquired about whether her and the doctor could hire a room twice a month. This is how it started.

I was on the board of British Charitable Fund at the time and now I am chairman.

We have about 20 ladies and gentlemen who attend. One of our members is 98 and we have a few who are in their late 80s and early 90s. We have around the same number of volunteers. We do ferry people to the club if the need arises but this is not always necessary.

What got you interested in getting involved with the Wednesday Club?

I took pre-retirement seven years ago and decided I was going to do charity work. I worked with the British Charitable Fund and the Royal British Legion. It was through my connections there that I heard about the Wednesday Club.

How has the Wednesday Club changed since it was founded?

When I first started at the Wednesday Club it had been around for 8 – 9 months. They used to play games like Bridge, Bingo and Scrabble. When you play games you don’t talk to the people around you but rather, concentrate on the game.

Dr Jones wanted people to interact so we don’t play as many games anymore. Instead, we sit down over tea, coffee and sandwiches and simply spend time to talk to each other.

The people who come treat each other as friends rather than people coming along to the club and this is what is important in fighting off loneliness. It’s about building meaningful friendships and building up a supportive community.

What are some reasons that people should get involved and how can they get involved?

If you are a person who is interested in charity work or simply like to meet people, then the Wednesday Club is a good place to get involved in. You can get involved as a member or volunteer by going to our website http://www.the-wednesday-club.org/.

How has the Wednesday Club changed the lives of those who attend in Brussels and what impact has it made?

The people who come get a lot out of it. A person reached out to one of our staff saying that he received a phone call 6 – 8 months ago. It was about their Dad who was in Brussels and he retired and became lonely. When we asked if he was in need of financial support, the son confirmed that his Dad was just lonely and needed support. Now the father comes to the Wednesday Club every time, he has gained companionship and is no longer stuck at home by himself. Loneliness breeds loneliness. This is why the Wednesday Club is important to elderly people as it provides a place to meet people and form connections.

Why is it important for people who are outside of the Wednesday Club to know about it?

There might be people out there who are lonely and this would give them an outlet. You don’t have to be British to join. We have Belgians, Germans and Brits and we are open to people of all nationalities. If they find out about it, it would help defeat loneliness. It’s also important because depression has risen but the topic of depression is less stigmatised than before. Loneliness can contribute to feelings of depression and this is something that we work towards preventing.

 

The day starts with the ringing of my alarm clock. With the knowledge of my 9:15 AM arrival, I have trimmed down my morning routine to a fine art, maximising my recuperation from the previous day’s work. Shirt, chinos, boots and I’m out the door, man on a mission – no time for style points. The same 15-minute walk to the chamber every day leads to an existential crisis running through my head. Do I deserve that pain au chocolat? No I don’t and I don’t have the money for it.
Heading into work I discover my counterpart, Nikki, who readily tells me of her 6 AM arrival at the chamber and her never ending university essay. Then the first cup of tea of the day. Joe and I, the only full time English tea drinkers in the office reach our usual compromise – making half a cup each, keeping us both happy. With tea in hand like many in Brussels I scroll Politicos Playbook for the first part of the morning as I ease into the work day. If there is something relevant to either the Single Market or Food, Health & Consumer task force’s, the two areas that I work in, I will do some follow up research of articles related to the task forces through Political, Euractiv or Financial Times as well as the European Commission’s and Parliament’s news sites. From my research I produce a monthly press review consisting of any major or relevant events in their individual areas and breakdown: what happened, who’s involved, the next steps, relevance to our members etc. Some items from this review can be taken forward and become topics for event at the chamber.
Before I know it its 11 AM and the caffeine crave kicks in, pulling me across the office to artificially stimulate my capacity for replying to emails which, by this point have stacked up. I take the opportunity with my productivity now peaking to work on securing speakers for a few upcoming EU Committee and task force. Occasionally, this requires me to get on the phone and talk over logistics of the event and answer and questions that people may have about speaking at a chamber event. Next, lunch. There are many options which are thrown around the office: Thai, Lebanese, chicken shop? All of which are tossed aside for the option we all new was going to come out on top – sandwich. After lunch follows the second cup of tea, with the labour of the task yet again split in two I jump back into action. Nursing my tea, I update our Monday Mail adding the new events we have confirmed whilst removing old events which are now outdated. Talking with the EU Committee team we decide which event we should promote and check with both the Business and Trade team as well as the Communications team if they have anything which we need to add to our Monday Mail.
At some point in the afternoon we (the interns) will dedicate 20 minutes or so to a room set-up for an upcoming event, this is usually one or two days in advance as we like to be somewhat organised as well as getting a little workout in. Once I’m back at my desk for the afternoon session, I crack on with preparation for upcoming events, which at the moment includes two dinners with European Commissioners and a panel debate on the Good Package. As part of the event preparation, we liaise with the chairs of the relevant task forces and the speakers deciding on titles, discussion points and to clarify any information. Beyond this, when productivity and brain power levels run low I move on to my marketing material, this includes booklets, flyers and updating the website with the relevant information and images.
By the time 6 PM comes around I start tidying my desk and look to head home unless, I’m needed to help out with one of the later events. During the shift from working to actually leaving the office we (the interns) contemplate if the shred of sunlight we saw two hours ago justifies us blowing off the gym and heading to the pub instead. It does, frequently.

 

 

This blog post was written by Marc Verbeek.

Marc Verbeek

Marc Verbeek is a Tax Partner currently working for Crowe Horwath Vanhuynegem Associates in Belgium, prior to this he worked at the Belgian Ministry of Finance, before moving on to spend 26 years with BDO. Marc is a certified tax consultant. His expertise includes (international) corporate tax advice, international employment tax, corporate tax compliance, rulings and litigation.

One of the biggest changes to the way UK companies interact with HMRC, the UK tax authority, is coming into effect from 1 April 2019. Making Tax Digital (MTD) is HMRC’s initiative to bring technology and tax together, allowing HMRC to become a “world leading, digital tax authority.”

What does it mean?
The changes will mean that all UK VAT registered organisations with a turnover above the UK VAT registration threshold (£85.000) will have to:
• keep, and be able to provide, their UK VAT records digitally.
• submit their UK VAT data to HMRC through compatible software, not through the HMRC online portal.
HMRC will no longer allow UK VAT return figures to be manually entered in the HMRC online portal when submitting the UK VAT return. Instead, you will need to have software capable of doing this for you.

Will I be affected?
Any business registered for UK VAT as their turnover has exceeded the UK VAT registration threshold will be affected. Of those, some already have a digital mechanism to transpose the figures from the UK VAT return workings to a submission, however the majority do not. According to figures from the Chartered Institute of Taxation, the leading professional body in the UK for tax advisers, 87% of UK VAT taxable persons will have to take action as a result of the new rules. The only exemptions will be for religious reasons or in the event of insolvency procedures.

What about international businesses?
Of particular interest to Belgian businesses will be that almost everyone who is UK VAT registered will have to comply with the MTD rules; being established overseas or submitting UK VAT returns outside of the UK will not result in an exemption from MTD requirements.
In addition, it may be a greater challenge to overseas organisations to comply with MTD for UK VAT as their UK activities are likely to be a single part of a larger international activity. This could also be the case for UK organisations who are part of international groups required by their overseas head offices to operate specific accounting or reporting processes and software.
As a result, if your organisation is currently manually entering the UK VAT return figures on HMRC’s portal, MTD will present a significant change to your current UK VAT processes.

What are the main requirements?
HMRC’s intention is that software will be used to maintain the relevant digital records, calculate the UK VAT return figures and to submit the return electronically. This is to be done using functional compatible software.
This software should also act as a digital ‘bridge’ between the UK taxpayer and HMRC’s systems. It will no longer be acceptable for an organisation to manually transpose figures when submitting their UK VAT returns.

When does this take effect?
HMRC has indicated there will be a “soft landing” period between April 2019 and April 2020 without application of financial penalties for record-keeping failures. This is to assist organisations by allowing extra time to update their systems to be fully compliant. There will however, have to be a digital link from the outset between the spreadsheet and the linking software that submits the UK VAT return digitally.
MTD as it currently stands is likely to just be the start of the road; it is intended to be introduced for UK Income Taxes in April 2020 and it is not unreasonable to expect that the scope of what information and data is available electronically for HMRC to access remotely will only get broader. As a result, even with a soft landing period, companies need to proactively take steps to ensure they remain compliant.

What software should I use?
HMRC has stated that it will not be providing software for organisations to use, and currently they have not yet informed taxpayers as to commercial software suppliers who will be providing the “functional compatible software”. Commercial software providers are developing solutions and some organisations will have sufficient in-house IT capability to build their own.
“Functional compatible software” is a software program or set of compatible software programs that must be able to:
• record and preserve electronic records in an electronic form for up to six years
• create a UK VAT return from the digital records
• provide to HMRC information and returns from the electronic records in an electronic form and by using an Application Programme Interface (API) to link to HMRC’s systems
• receive information from HMRC.
There “must be a digital link” between all software used by the organisation for its UK VAT compliance. Examples are given in HMRC’s guidance and a very common one, likely to be familiar to a large number of organisations, is the situation where to prepare the UK VAT return the taxpayer:
– maintains its sales and purchases data in an accounting system
– downloads this data into a spreadsheet for manual manipulation
– manually enters the figures into HMRC’s website for submission.
Under the new rules, the links between the two software programs (accounting system and spreadsheet software) must be digital.

What now?
Although the implementation date is in 2019, like all technology projects, there is a lead time in making the necessary changes to be able to successfully implement the measures needed to comply with the new rules.

Organisations affected by MTD need to consider a strategy for the immediate requirements to be ready for the April 2019 launch date and also give thought as to whether these preparations should include a readiness for a likely future expansion of the MTD requirements, be it for additional UK VAT data or for other UK taxes such as Income Tax.

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