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17 February 2016

  |  CBI Updates Team

Case study

Redwood Technologies Group and the EU

Award-winning communications technology firm Redwood Technologies Group would prefer the UK to remain in the EU, benefiting from the regulatory similarities and free flow of information and data, although the EU could improve by updating the single market for the digital age and reducing red tape.

Image of Redwood Technologies Group and the EU

NB: This was published prior to the referendum result of 23rd June 2016

Based in Bracknell, Redwood Technologies Group comprises three sister companies - Content Guru, Radius Communications and Redwood Technologies – which provide award-winning integrated cloud communications to a range of customers: from Governments and big businesses like Vodafone and UK Power Networks, through to SMEs around the world.

A substantial proportion of our business is carried out within the EU: We own European operating companies with offices in the Netherlands and Germany and we are currently looking to expand into Eastern and Southern Europe. On top of this, around 5% of our turnover is generated from British exports to EU countries, and significant revenues are generated by our communications platforms in the Republic of Ireland, which are directly owned and controlled by our UK cloud operations company, Content Guru. Our Dutch trading company accounts for another 5.8% of our sales through their business with Europe.

Many of our customers are EU multi-national companies and expect us to provide our solutions seamlessly and securely, wherever they are.

As we sell both services and equipment, the regulatory similarities the UK has with other EU nations as a result of EU law have proved advantageous. Our costs are lower because compliance is simple and streamlined, and we face no import tariffs or other levies. Additionally, our customers are reassured that what they’re purchasing from us meets known and agreed standards of safety and conformity, just as we are reassured that the hardware we purchase from other EU countries fits our needs. These common rules level the playing field between ourselves and our EU competitors when we sell in EU countries, and indeed these standards are known about, accepted and respected when we trade elsewhere in the World.

At the same time, EU-wide trademark and copyright arrangements further simplify the protection and development of our valuable Intellectual Property.

Furthermore, whilst we do not employ significant numbers of EU migrants to work in our UK businesses, it is useful to have the option open to us. We already make use of the free movement of labour when we send our British engineers to work around Europe for our customers, with no question of work permits or visas being required. Similarly, European staff from our overseas operations come and go between our UK and other offices every week, without any sense of their being part of anything but a single organisation.

As a business in ICT, we also benefit from the free flow of information and data around the EU. However, this is also an area in need of improvement. The European Union’s single market needs updating for the digital age in a way that considers the complex needs of technology and digital businesses of all sizes. The same could be said for the single market in services.

If the EU improved in this way and others – reducing red tape and freeing up businesses to invest in growth – it would be even more beneficial for businesses like ours.

In the case of a UK exit from the EU, as well as the inevitable business uncertainty and potential macroeconomic and currency turmoil, we would expect to find the benefits of free movement of people and data, and of harmonised regulations, reduced. This would have negative consequences, though not insurmountable ones: We have long operated in the US and whilst it is more complicated, it is manageable. But working, trading and growing in Europe is a lot simpler now than it would be otherwise. As such, staying in the EU is our preferred option. 


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