What is the impact on businesses after Britain exits from the EU and how will they recover their debts from EU customers?
At this pre-Brexit moment in time, suppliers of services to the EU will in the majority of cases, include a clause in their business trade contracts that covers law and jurisdiction.
If you have supplied goods or services to a company based in the EU and there is this clause in your contract, then you will be able to take the EU based company to a local court to ensure your business is remunerated, including getting a judgement enforced that must be upheld.
Where a contract does not contain this clause however, UK companies currently benefit from the European Payment Order process, which simplifies the method of obtaining a judgement against a company based in an EU member state.
However, in a post-Brexit environment, it is not known what system or mechanism will be in place to help recover debts from EU based customers. There is even more uncertainty and lack of understanding how a deal or no deal will also affect these much needed recovery schemes.
We just have to hope for the best and plan for the worst!
Resource #1: Shoosmiths LLP have written an interesting article with logical theories on this important debt recovery topic which can be read at https://www.shoosmiths.co.uk/client-resources/legal-updates/recovering-debts-in-a-post-brexit-britain.aspx
Resource #2: The UK Government have set out an online "Get Ready for Brexit" checklist for both consumers and businesses to help prepare for 31st October 2019. Please visit https://www.gov.uk/brexit?fbclid=IwAR3V1LujHYYFE4p5SLN-EGfOfF1iZP2eDp2NkUS07IDCi2die4FHmCEc7A0
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