Mubasher: European Union (EU) and UK companies are likely to incur up to GBP 58 billion ($80.4 billion) in charges if Brexit negotiations between the two sides reached a dead end, a new study showed.

The study, cited by Oliver Wyman management consultants and law firm Clifford Chance, warned that the so-called “no deal” Brexit would cost EU and UK firms GBP 31 billion and GBP 27 billion, respectively, noting that the UK financial sector would be the biggest loser.

“These increased costs and uncertainty threaten to reduce profitability and pose existential threats to some businesses,” the report found.

However, the report indicated that the “best-prepared” firms were aware of the Brexit implications and have started safeguarding against possible threats.

“Unfortunately, we see that small firms are least able to take these steps at present," Kumar Iyer, partner at Oliver Wyman said in the report.

Earlier this month, UK prime minister Theresa May acknowledged that her plans would lead to a restricted access to the EU single market and trigger problems over the Northern Ireland borders. Meanwhile, the EU warned from potential negative economic consequences on the UK because of these plans.