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616
FORTUNE.COM// FEB.1.
NO-DEALBREXIT
How to Deal With
No Deal
British companies are already putting their
“no deal” Brexit contingencies in place.
By David Meyermass
adoption
Recreational
cannabis in
Massachusetts
got off to a
blazing start.$15M
CANNABIS
SALES IN FIRST
SIX WEEKS
Cannabis
retailers in
the Bay State
have raked in
$2.5 million
a week.20%
TA X ON
RECREATIONAL
SALES
The legalization
measure
approved by
state voters
suggested a 12%
tax. Lawmakers
significantly
increased it.8
RETAIL
LICENSES
APPROVED
Would-be
retailers have to
clear significant
regulatory
hurdles to obtain
a license. Only
two licensees
had been
approved by the
Nov. 20 sales
launch. [For more
on legal weed,
see page 84.]
—REY MASHAYEKHITHE VERY POSSIBLEscenario that
the U.K. leaves the European
Union without a negotiated exit deal would be a
shock to everyone’s system. With no trade deals in
place, tariffs would jolt into effect, causing short-
ages on shelves and blockages in ports.
So, how are businesses preparing for the pos-
sibility of no deal?
Many financial services firms are moving assets
out of the U.K. and into the EU. As the consultancy
giant EY reported, 20 companies have already
publicly announced such shifts. EY put a “conser-
vative estimate” of 800 billion pounds ($1.02 tril-
lion) on the total.Barclays has shifted
ownership of its
French, German, and
Spanish operations
from its British base
to its Irish subsidiary.
More than a third
of big U.K. financial
services firms are
moving staff abroad.
Many industries
are stockpiling.
Though the British
government has an-
nounced that medi-
cine imports will get
priority at the ports in
the event of no deal,
pharma giants such
as AstraZeneca and
Merck are caching
meds, just to make
sure. (AstraZeneca
has also begun
parallel testing at a
Swedish site, owing to
likely sudden changes
in regulation.)
And in the auto
industry, Aston Mar-
tin and Volkswagen-
owned Bentley are
not only stockpiling
components in order
to avoid manufac-
turing disruptions,
they’re also arranging
to use ports other
than Dover, the U.K.’s
main ferry link with
the European main-
land, which is likely
to become heavily
congested.
“We have to pre-
pare for the worst-
case scenario,” Aston
Martin CEO Andy
Palmer told Reuters.ALBERTO^ PEZZALI—NURPHOTOVIA^ GETTYIMAGES