UK firms fear­ing ‘hard Brexit’ em­brac­ing Baltic state’s dig­i­tal ID pro­gramme to re­tain EU ac­cess

New Straits Times - - Business / World -

AS Bri­tons brace for the up­heaval that Brexit could bring, some are turn­ing to Es­to­nia’s e-res­i­dency dig­i­tal ID pro­gramme to keep do­ing busi­ness across the Euro­pean Union.

Us­ing its knack for dig­i­tal in­no­va­tion to cap­i­talise on the global ex­plo­sion in e-com­merce, the cy­ber-savvy Baltic eu­ro­zone state be­came the first coun­try to of­fer e-res­i­dency iden­ti­fi­ca­tion cards to peo­ple world­wide in 2014.

Touted as a “trans-na­tional govern­ment-is­sued dig­i­tal iden­tity”, e-res­i­dency al­lows users to open a busi­ness in the EU and then run it re­motely with the abil­ity to de­clare taxes and sign doc­u­ments dig­i­tally.

It does not pro­vide cit­i­zen­ship, tax res­i­dency, phys­i­cal res­i­dency or the right to travel to Es­to­nia. Ap­pli­ca­tions can be made on­line via the­ web­site and cost €100 (RM481.38).

Just over 22,000 peo­ple from 138 coun­tries across the globe have be­come e-res­i­dents so far, in­clud­ing around 1,200 Brits, and last year’s Brexit vote trig­gered a boom in ap­pli­ca­tions from the United King­dom.

Be­fore it, only three Bri­tish cit­i­zens ap­plied per week, but that shot up to over 50 in its af­ter­math. There was also a 75 per cent spike in UK traf­fic on the web­site af­ter Prime Min­is­ter Theresa May trig­gered the Ar­ti­cle 50 EU exit clause in March.

A “soft Brexit” would mean that Bri­tain could re­tain ac­cess to the Euro­pean sin­gle mar­ket, like non-EU mem­ber Nor­way. But the “hard Brexit” op­tion that has pre­vailed so far would see UK leave the Euro­pean sin­gle mar­ket and the Cus­toms union, cre­at­ing a night­mare sce­nario for UK busi­nesses as there would no longer be free move­ment of goods and ser­vices.

“The UK may have cho­sen to leave the EU, but its en­trepreneurs can still choose to re­main in­side the EU’s busi­ness en­vi­ron­ment” through e-res­i­dency, said pro­gramme di­rec­tor Kas­par Kor­jus.

E-res­i­dency spokesman Ar­naud Cas­taignet said if a Bri­tish en­tre­pre­neur be­came an Es­to­nian e-res­i­dent and es­tab­lished a com­pany pro­duc­ing goods in Es­to­nia, then they “will have the same ac­cess to the EU mar­ket as any EU com­pany”.

So far, the ma­jor­ity of com­pa­nies es­tab­lished by e-res­i­dents are in con­sul­tancy ser­vices, IT and pro­gram­ming, web de­vel­op­ment and sup­port ser­vices.

An up­grade to the e-res­i­dency pro­gramme in May saw Fin­nish fintech com­pany Holvi team up with Es­to­nia to launch bor­der­less dig­i­tal bank­ing, elim­i­nat­ing the need for e-res­i­dents to travel to take care of busi­ness bank­ing. AFP

Newspapers in English

Newspapers from Malaysia

© PressReader. All rights reserved.