British companies such as INEOS, DS Smith, JLT Group and Gymshark are already convinced of Flanders’ strategic assets for their post-Brexit business in Europe and have recently invested in the region.
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Business in Europe after Brexit: safeguard or expand your foothold through Flanders
Brexit transforms the way UK-based firms do business in Europe. Unpredictable changes – from trade barriers to new standards and regulations – may impact your company’s competitiveness. Looking for continued easy access to the European Single Market? Seeking to tap into Europe’s R&D programmes and subsidies? Eager to safeguard and expand your foothold in Europe from a central location? Flanders, Belgium’s northern region, can help you achieve these ambitions.
As Belgium’s northern region, Flanders is perfectly located in the middle of Europe’s major commercial and industrial centres, including Paris, Amsterdam, Frankfurt and the Ruhr Valley. Its seaports – including those of Antwerp, Ghent, Ostend and Zeebrugge – connect UK companies to the European mainland in a matter of hours.
Adding to its seaports’ convenience, Flanders is ideally equipped to help you unlock Europe’s market potential through multimodal transport. Flanders’ road and railroad systems, for instance, are among the world’s densest – not to mention the region’s logistics infrastructure, which comes in at 3rd place in the World Bank’s biennial Logistics Performance Index.
There’s also great news for UK citizens travelling to the EU. Even after Brexit, they will still be able to enter the Schengen zone without a visa – and Flanders offers various options for business travel:
- Cities like Antwerp and Brussels are part of Europe’s high-speed train network and offer fast railway connections to 19 different cities in the Netherlands, France, Germany, Luxembourg, Italy, Spain, Switzerland …
- With the Eurostar railway service via the Channel Tunnel, your employees can easily travel between London and Brussels, enabling them to commute to work in Europe while living in the UK.
Airline operators at Brussels Airport and Antwerp Airport offer frequent flights within and beyond Europe. Antwerp Airport is particularly aimed at business travel, providing UK travellers with a smooth, fast connection to London City Airport.
What’s more, Brussels – the capital of Flanders and Belgium – is home to hundreds of international corporations and intergovernmental decision-making organisations, such as the EU and NATO. The city can easily be considered as Europe’s lobbying capital as well: over 3,800 diplomats are active in Brussels. Only New York City has more.
Due to Brexit, firms with a base in Flanders will be facing new business, trade, customs and legal requirements when exporting their goods from Europe across the Channel. To safeguard your business, you’ll need to prepare in terms of export and import formalities, customs authorizations, exchange rate fluctuations, standards, accreditation and conformity, packaging, contracts, HR processes, and more.
In the corporate jungle, survival requires organisations to be innovative. And what do innovative companies have in common? Besides not shying away from risks, they tend to look beyond company walls. That’s exactly what Flanders’ cluster policy is all about.
Flanders actively promotes and supports long-term R&D collaborations between the public, private and academic sectors. The region’s four strategic research centres perfectly illustrate this policy. Supported by the government and working closely with companies and universities, their research covers niches such as:
- nanoelectronics and digital technology (imec);
- life sciences and biotech (VIB);
- product and process technology (Flanders Make);
- clean and sustainable technology (VITO).
It’s no secret that R&D comes with a high price tag. Companies are increasingly seeking cash grants and tax incentives to ease their financial burden – and Flanders has put itself firmly on the map in this regard.
Some of the region’s most used incentives include:
- innovation income deduction – up to 85% of your net innovation earnings are exempt from corporate taxation.
- R&D investment deduction – 13.5 of the investment value or 20.5% of the annual depreciation value can be deducted from corporate taxes.
- R&D payroll tax inventive – recover up to 80% of the withholding tax on professional income for research personnel.
A recent publication by Eurostat indicates just how effective Flanders’ R&D-friendly tax system is at encouraging innovative business projects. According to the most recent figures, 2.7% of the Flanders’ GDP is invested in R&D activities. This is well above the European average of 2% and close to the 2020 target of 3%.
Through Flanders, British companies that are established in the region can access and benefit from European subsidies, funds and other types of financing programmes for corporate, government-backed and academic projects.
To mention just four examples:
- The Horizon 2020 research and innovation programme frees a budget of almost EUR 80 billion between 2014 and 2020 to support companies and academic players.
- The EU Health Programme earmarks EUR 449.4 million to involve private, public and academic players in implementing the EU’s health strategy.
- More than half of EU funding is channelled through five European structural and investment funds (ESIFs). Managed by the European Commission and EU Member States, these funds encourage projects that contribute to creating additional jobs as well as a sustainable, healthy European economy and environment.
- The European Regional Development Fund (ERDF) supports investments in innovation, research and other key domains that help strengthen economic and social cohesion within the EU.
The war for talent has reached its peak. To overcome post-Brexit challenges, your company will have to find highly educated people with the right set of skills to support and boost your business success in Europe. To help you achieve just that, Flanders’ education system endows employees and researchers with the necessary technical, digital, intellectual and language competencies – and the proof is in the rankings!
According to various international rankings, people in Flanders are:
- highly productive – #4 worldwide for labour productivity (US Conference Board).
- highly skilled – #12 in Europe for digital skills (DESI) and #17 within the OECD for collaborative problem-solving skills (OECD PISA).
- highly educated – #1 for mathematics, #3 for science literacy, #5 for reading skills in Europe (OECD PISA).
To top it all off, Flanders’ people are multilingual by default. Most are fluent in the Belgium’s three official languages – Dutch, French and German – as well as English. In fact, according to Education First’s English Proficiency Index, people in Flanders are the world’s 11th best non-native speakers of the language of Shakespeare & Co.
When you set up a base in Flanders, you’ll gain access to a variety of employment subsidies and structural social security reductions. And there’s more…
As an employer, you can also benefit from target group reductions for the first employees you recruit in Flanders:
Four days: that’s all it takes to set up a base in Belgium and Flanders, according to the IMD World Competitiveness Yearbook 2018. This makes the region one of the fastest-to-incorporate places in all of Europe. And, of course, Flanders Investment & Trade offers comprehensive professional support to companies and entities at every stage of setting up operations in Flanders.
Whether you’re looking to buy, rent or build, Flanders offers ample and affordable space for your company. Cities like Antwerp and Ghent offer the least expensive rental prices when compared to those of neighbouring regions and countries. From seaport locations and corporate offices to manufacturing sites and logistical space, Flanders has an ideal and perfectly-priced option for your business.
Welcome team at your service
To help you find your way around Flanders and set up a base as smoothly as possible, Flanders Investment & Trade has established a dedicated Brexit Welcome Team. This group of experts will gladly assist you with practical advice and support.
Get in touch with the Brexit Welcome Team.
Part of the world’s most globalized country (KOF Index of Globalization), Flanders certainly deserves to be called an international trade powerhouse – bringing your business close to Europe and the rest of the world. Not only has foreign direct investment been booming for the past decades, Flanders’ export figures continue to soar as well.
Flanders attracts citizens and professionals from around the globe. The region’s capital, Brussels, is even home to 182 nationalities – making it the world’s 2nd most cosmopolitan city (2015 World Migration Report) and Europe’s #1 expat destination (2017 Skyline Europe report). Antwerp, one of Flanders’ main cities, isn’t far behind with more than 150 nationalities.
What do Flanders’ expat destinations have in common? They offer high quality of life for a relatively small price tag. Brussels, Flanders’ capital, provides a telling example. The multicultural hotspot comes in at #27 worldwide for quality of life according to Mercer HR Consulting, yet only ranks 67th in the list of most expensive cities.
In Flanders, expatriate employees, researchers, managers and executives temporarily posted in the region can benefit from a whole range of tax incentives. The tax-free expat allowance is just one example. It covers the additional costs of living and housing in Flanders.
The unlimited tax reimbursement of expenses, such as installation, moving and education costs, is another perk. In addition, foreign executives temporarily assigned to Flanders – usually managers or highly specialised profiles – may qualify for a special tax regime.
With up to 75% of healthcare costs reimbursed in Flanders, healthcare isn’t simply excellent – it’s affordable too. The same attributes apply to the region’s education system. What’s more, you’ll discover many top-ranking international schools in Flanders, including several British schools.
There are many historical and cultural ties between the UK and Flanders. British expats and travellers who are familiar with the region spontaneously associate Flanders with harbours, historic buildings and cities, and natural scenery.
The region’s historical background – Flanders was one of Europe’s main battlefields during both World Wars – and its artistic scene are also top-of-mind. The same goes for tasty food and drinks, particularly beer and chocolate.
- The popular game of cricket is thought to have originated in Flanders. Recent research has unearthed a reference to the game in a poem from 1533. The poem links the cricket game to weavers from Flanders who settled in southern and eastern England, referring to them as “kings of crekettes”. Even to this day, many cities in Flanders have their own local cricket club.
- Many soccer players from Belgium and Flanders have risen to the top of the English Premier League, including the likes of Vincent Kompany, Kevin De Bruyne, Eden Hazard, Romelu Lukaku, Jan Vertonghen, Toby Alderweireld and Simon Mignolet.
Each year, martyr town Ypres, in West Flanders, attracts thousands of World War I commemorators from the UK. Every night at 8 pm, a moving ceremony takes place under the town’s Menin Gate. The ‘Last Post’ ceremony has remained a daily ritual in Ypres ever since 1928.
- Many UK citizens can trace their ancestry back to Flanders. In Scotland, for example, it is estimated that a third of the population came from Flanders. Between the 11th and 17th century, people from the Low Countries made up the largest immigrant group in England, Wales and Scotland – especially highly skilled weavers and textile workers from Flanders. In 1527, for example, England’s five-million population included tens of thousands of people from Flanders.