On Brexit, the citizens of the United Kingdom voted and chose to leave the European Union. This decision will have consequences for online stores
Brexit is already a reality, the citizens of the United Kingdom voted and chose to leave the European Union. This decision will have numerous consequences for online stores, for the life of the country but also for the international economy, especially for the eCommerce sector.
Those responsible for eCommerce must take advantage of the time established for the separation of the United Kingdom from the European Union to adapt to the new political and economic situation that will be experienced in the other countries that are part of the Union.
The economic consequences of Brexit
The first logical consequence of Brexit is obviously that UK customers will have to pay customs and value-added taxes as soon as they buy from stores outside their country. In other words, Spanish online products will be much more expensive for English users, from the moment the separation from the European Union becomes effective.
In addition, the fact of having to go through customs can cause many deliveries to be substantially delayed, so the service of Spanish e-commerce to the United Kingdom can no longer be efficient.
Both the price increase represented by the taxes to be paid and the passage through customs and the bureaucratization of sales will become a major challenge to overcome, especially for small and medium-sized online stores that are not prepared to face exports at this level.
Likewise, it is also important to take into account the economic consequences that Brexit may have for UK companies that plan to expand in Europe. the increase in costs that the separation from Europe will imply and the need to have to balance skills can cause online businesses to see how their profits are drastically reduced. Faced with this perspective, many companies are adopting a waiting position before the evolution of the situation.
Another fundamental aspect to take into account as a result of Brexit is the increase in logistics fees that most eCommerce companies will experience. If the price of shipments to the island is already more expensive, the fact of being outside the common European market can make shipments even more expensive.
One of the most obvious consequences of Brexit will be the changes in the value of the pound sterling. This currency is expected to fluctuate until the situation of the United Kingdom with respect to the European Union stabilizes. Therefore, it will be difficult to work transactions in which this currency is used, especially when updating prices according to the currency exchange, since both the euro and the pound can devalue much more quickly than expected.
Brexit at the legal level
When the United Kingdom has legally separated from the European Union, it will no longer have any obligation to continue complying with the standards set to guarantee the protection of data of European users. Therefore, it will not even be included in the list of safe countries anymore. Without a doubt, it is an important fact to take into account when considering the interaction between users and online stores in Spain and the United Kingdom.
In addition to these data protection changes, it should also be noted that the UK will need to create its own e-commerce laws when it secedes from the European Union. This implies a significant possibility of discrepancies between the existing legislation and the one to be created. The direct consequence of this will be the emergence of various operational and bureaucratic obstacles, which will make it difficult to trade online with the United Kingdom.
The United Kingdom is one of the strongest economies in the European Union, so it is clear that Brexit will have negative consequences for eCommerce. In any case, the position adopted by the country’s government when negotiating the relationship with Europe will be key to being able to clearly define the consequences that Brexit will have. Opting for a free trade agreement and joining the European Economic Area would produce the most positive scenario.
Likewise, it is important to take into account the assessment of many specialists in business strategy, who consider that the Netherlands could be the center of the new international e-commerce. Its geographical location and its logistical capacity can make this country the new center of European online business, after the defection of the United Kingdom from the European Union.
