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Do you have a European supply chain? A supply chain risk assessment and checklist will help you get ready
- AuthorNigel Adams
Whilst we hesitate to say “take back control”, when it comes to your supply chain it is absolutely vital that you have a proactive management approach that provides oversight and control. The task is difficult in any circumstance because your supply chain is external to your business, but now that the UK and Europe have a new Trade & Cooperation Agreement in place, it is vital to have a robust approach.
You should be considering:
- Employees - freedom of movement to and from the EU has ended
- Goods at EU border crossings – time, costs, and paperwork will all increase
- Insolvency risk of your suppliers
- Exchange rate volatility (both good and bad)
- Key goods for your business – will they still be deemed safe and useable?
- Warehouse storage needs may increase should you need to stockpile
- Reporting on rules of origin will change
- Will your EU suppliers still trade with you or will it become too much hassle?
- VAT complications
- Data protection rules have changed and although transfers from the UK to the EEA will continue as before, there may be future consequences for UK businesses importing data from EEA countries after the new four month temporary agreement ends.
Please contact Nigel Adams if you would like a thorough risk assessment of your supply chain and for advice on the practical steps that you should take to reduce your legal and commercial risk. These include:
- Creating a due diligence questionnaire for suppliers
- Devising a communication strategy for your supply chain that you can share with your supply chain
- Reviewing current sourcing strategies to provide yourself with fall back options
- Conducting regular credit risk reviews of your suppliers
- Filing your signed contracts and standardise contract terms for EU related risks
- Checking contract clause drafting for essential risks e.g. what happens in an insolvency situation?
- Securing access to information and data
- Reviewing current and potential legal disputes
This guide is for general information only and should not be relied upon as providing specific legal advice.