Britain's impending exit from the European Union has led to fears over the future success of Britain's tech industry, but Facebook's EMEA VP Nicolas Mendelsohn believes there could be benefits if the country plays its cards right.

Mendelsohn was speaking at a Culture, Media and Sport Committee hearing in the House of Commons on Tuesday discussing the impact of Brexit on the creative industries, tourism and the digital single market.

Image: iStock/georgeclerk
Image: iStock/georgeclerk

"It’s both a threat and an opportunity," she said. "The opportunity perhaps could be around what we do in our own country to skill up."

Facebook chose London as the location for its first overseas office in 2007, and will open a new headquarters in the capital this year where it will add another 500 employees to its current UK headcount of 1,000 staff members.

"The future pipeline is perhaps the most important thing of all," said Mendelsohn. "We came here from a tech company perspective because London is an incredible place for the tech industry and it’s an incredible place to find great, highly skilled talent."

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Key to that investment and London’s status as a tech powerhouse is the continued channel of international talent into the city, and Mendelsohn wants this at the centre of Brexit negotiations.

"We would seek reassurances both for the people that are already here but also for the people who we might want to here in future, that they can come here and so can their wives and families, so that would probably be the main area that would be of importance," she said.

Gaming and visual effects companies, many of which are very small, have especially urgent needs for talented professionals.

"You might make a game that can go all round the world, that’s enjoyed by millions of people [and] it might literally be seven or eight people working out of Dundee being able to collaborate with the skill sets they need around the world," said Mendehlson.

Access to visas

Bureaucracy is a barrier to collaboration, and difficulties accessing visas could prevent business progression. The negotiations also represent a chance to make it easier to access talent, by making British systems more responsive to industry needs.

Tech talent is predominantly young, mobile and highly skilled, but wages and employment periods can vary immensely. The current tier two VISA has a qualifying salary of £30,000, but this figure can increase when demand is high.

Creative Industries Federation chief executive John Kampfner called for a system that looks beyond earnings, which is not always an accurate assessment of a worker’s value.

"I would recommend some sort of caveat determining value that doesn’t only use earning potential as the criteria," he said.

Future requirements for overseas talent would need to cover long-term appointments, medium-term collaborations, and emergency visas to quickly bring in talent when required.

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The recent rhetoric of Theresa May was reassuring, Kampfner added, but it needed to be reflected in official policy.

"This is a real opportunity for central government, in conjunction with local authorities, to really take advantage of that," he said.

Mendelsohn was particularly concerned with the protection of Intellectual Property and the ability of the industry to sell content territorially.

"[IP] for all of us and the entire industry is absolutely crucial, because so much of our industry is built on having that and protecting the IP,” she said.

"I think maintaining the core strength of the current regime is absolutely crucial going forward but also making sure we proactively negotiate and make sure we retain proposals going forward as well. This really is a red line for us."

Key to her concerns was access to the Digital Single Market, an EU initiative established to cultivate the continent’s digital economy and support access to online products and services. Its protection of the free flow of data across the continent is crucial to the future of small British businesses.

"Currently today there are 300 million people on Facebook that are connected to a small business in the UK," said Mendelsohn.

"That freedom of movement between the data is incredibly important in order that those businesses can trade freely, and it hasn’t been an issue to date and hopefully it won’t be going forward either."

Maintaining a relationship with the EU

Discussions on the Digital Single Market are ongoing, but Britain’s future role looks likely to be diminished.

"There is quite a lot of evidence that the UK has stepped back from the negotiations and that on a number of fronts is problematic," said Kampfner.

There are already examples of UK institutions being forced reduce their role in EU collaborations. The Guardian reported in July that some British academics have been asked to leave projects funded by the EU as they are now considered a financial liability. But not all the opportunities offered through EU membership must end when Britain leaves the union.

In addition to skills, the EU offers funding, regulatory framework and trade and investment opportunities that benefit the tech sector. The UK could still benefit from some of these after Brexit.

"We voted to leave the EU," said Arts Council England chair Sir Peter Bazalgette. "We didn’t vote to leave the Council of Europe and we didn’t vote to leave creative Europe [or the single market]. We can continue with some of these things and they are very important."

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Research and development receives 18.3 percent of the UK's funding from the EU, according to a House of Lords committee. It’s possible to remain engaged with some EU funding bodies. Switzerland, for example, retains access to the Horizon 2020 pot by continuing to contribute to the EU budget.

The growing resistance to immigration and multiculturalism could produce a less welcoming culture that would make the country a less attractive destination, as the reaction to the policies of President Trump has demonstrated.

"There is also the question of the atmosphere," said Kampfner. "Where do you want to be? Whatever visa regime we introduce, Britain has a very sort of warm, open, inviting, meritocratic message to send."