Some US businesses have made their views about a Brexit known to their UK workforce. So, for example, Microsoft which employs 5,000 people in Britain has said in a letter to UK staff that Britain should stay in the European Union if it wanted to receive more investment12. Companies thinking of taking a position in the debate, one way or the other, are free to do so but need to ensure that they comply with UK referendum rules governing campaigning activities and expenditure.
It is difficult for US businesses to decide how much to do in the way of planning until the result of the referendum is actually known on June 24, 2016.
There are some immediate risks that might be anticipated, including, for example, hedging currency risk to the extent a business has exposure to a possible short-term drop in sterling13. US businesses might also start to think ahead to how a Brexit might impact on any UK operations, as well as the wider potential impact for the industry sector in which they operate. Our Q&A brochures on the Financial Institutions and Energy industry sectors look at some of the questions businesses operating in those specific sectors may want to consider including, for example, the potential impact on access to the single market, potential legislative and regulatory changes specific to those sectors and potential loss of funding or membership of EU industry bodies and institutions.
If there is a vote to leave, we also know that there will be at least a 2 year period from the referendum before a formal exit by the UK from the EU14. During this period, US businesses with exposure will be able to commence a comprehensive review of perceived areas of risk, including legislative risk, contract and counter-party risk, trade, funding and operational risk (to the extent relevant)15. It may then take a further period of 10 years16 or more before the post Brexit legislative, regulatory and new trading landscape becomes clearer and businesses are in a position to start planning ahead with more certainty.