Venable partner Friedemann Thomma was interviewed in the August 1, 2016 issue of Tax Notes International on how Britain's vote to leave the European Union could influence cross border merger and acquisition deals. While the vote is expected to shake up the M&A market, so far companies with cross border deals have opted to proceed despite the uncertainty.
"Obviously none of these companies like the uncertainty," said Thomma. "Clients with substantial operations in the U.K. are eager to start the dialogue about how to mitigate the impact of the vote." Noting that the Brexit vote will slow the migration of companies to the UK, he added, "Some companies are already considering a Plan B in order to stay within Europe…There's no greater threat to companies than the instability of frameworks." However, he pointed out that "The U.K. is too important of a market for companies to leave behind…Whether that means moving headquarters from the U.K. to Ireland, the Netherlands, Luxembourg, [or] Switzerland or setting up parallel structures outside the U.K. remains to be seen, but those are the critical considerations happening now."
Despite the vote, there is still a possibility that Britain will not actually leave the EU, meaning the challenges facing businesses now might be less pronounced down the road. "The U.K. will take lots of measurements to try to get into a similar situation as they already have with the EU," Friedemann concluded.