How UK Prime Minister Boris Johnson Is Shutting Down the Government

Stephanie Hirschmiller

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Over the last few days, there have been escalating demonstrations across Great Britain protesting against UK Prime Minister Boris Johnson’s decision to prorogue Parliament to facilitate a potential no-deal Brexit.

To “prorogue” is to terminate, or suspend, a session of British parliament by royal prerogative. The current suspension is set to commence Sept. 10 and run until the Queen’s Speech on Oct. 14.

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Officially, the Prime Minister asks the Queen for the suspension; in this case, it was granted on Aug. 28. It is generally viewed as a formality and never subject to a vote.

So why do the people of Britain care so much?

It’s all in the timing. Suspensions generally run from a few days to a couple of weeks, but this one would be 23 days long.

This means MPs are unlikely to have the time to vote through a law that would prevent the UK from leaving the European Union without a deal on Oct. 31.

It would also prevent MPs from holding a vote of no confidence in the government.

While legal, many are dubbing the maneuver “undemocratic” under the current circumstances. A petition to block the suspension has already been signed by more than 1.3 million people, while various legal challenges are currently being organized.

Many British-based companies have already commenced damage limitation exercises in preparation for the no-deal outcome that is looming and increasingly likely.

In July, Manolo Blahnik announced its acquisition of Italian women’s shoe manufacturer Calzaturificio Re Marcello. CEO Kristina Blahnik cited the move as “providing greater creative and operational flexibility for the future of our business.”

According to Church’s CEO Anthony Romano, stockpiling raw materials could benefit companies with U.K. production. While leathers are sourced from continental European tanneries, the Prada-owned British heritage brand owns its factory in Northampton, and Europe accounts for 40% of its business. He also said that currency hedging and moving finished product to Europe are other potential solutions. But he admitted that there are still many unknowns, and, as such, it is difficult to be fully prepared.

Most U.K.-based luxury firms, however, have Italian production. Rupert Sanderson, for example, ships directly from its Italian factory and pays European Union export duties. Commercial director Andrew Stewart said such duties were his main concern.

“Being a registered British company, it’s still not clear how the duties will play out. Should receiving countries, such as the U.S., EMEA and APAC regions apply significantly higher duties, this would be catastrophic to the business [because] it would deplete our margins and could make our products less competitive,” he said.

He added that issues might also arise regarding the freedom to move around Europe with samples. “I come to Paris six times a year for showrooms and ship via DHL,” he said. “We don’t currently need any documentation or incur any added costs, but if we have to go back to using carnets (merchandising passports), it won’t be so easy.”

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