Brexit and Toys: Keep Calm and Carry On For Now
5 July 2016
On June 23rd, the United Kingdom’s citizens voted 52% to 48% to secede from the European Union (EU) in a referendum commonly referred to as “Brexit.” Though Britain’s full withdrawal from the U.K. could take more than two years once fully approved, regulations and tariffs applicable to toys sold in the British market may be impacted.
The Toy Industry Association (TIA) issued a statement acknowledging the many variables at play in the U.K. market. Though the industry will not experience immediate effects, toy association leaders on both sides of the Atlantic expect some long-term changes.
“It’s too soon to speculate on exactly how trade will be impacted by Brexit beyond the current impact on the pound sterling for companies with British operating divisions,” said TIA president and CEO Steve Pasierb. “We’ll certainly be monitoring developments as U.K. and EU negotiations unfold, and keep our usual open dialogue with members as well as our colleagues at the British Toy & Hobby Association (BTHA) and Toy Industries of Europe (TIE).”
Though TIE has not released an official statement, David Allmark, TIE chairman and managing director at Mattel, said it will be “business as usual until further information is available” for companies with operations in the U.K.
The resignation of British Prime Minister David Cameron in September is a first hurdle to overcome, he said, as the country awaits new leadership.
And though the U.K. referendum on EU membership resulted in a “Leave” vote, the withdrawal process has not yet begun due to polarizing debates about whether a parliamentary vote is needed to invoke Article 50 of the Lisbon Treaty, the legal protocol which formally triggers a maximum two-year exit process.
“Until Article 50 is invoked by the U.K. Government – that’s the official kickoff of the exit process of negotiation – nothing changes,” Allmark said. “But this will be a long process for sure.”
TIA members will be kept apprised of any developments on this matter.
More News >