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Some smaller broadband providers may decide to leave Scotland should the country opt for independence from the rest of the UK.

This is the warning from Adrian Kennard, Managing Director of service provider Andrews & Arnold (AAISP), ahead of September's referendum.

In a blog post, he highlighted some of the potential issues for smaller broadband providers operating in an independent Scotland - such as the need to be VAT-registered, to pay corporation tax and do currency exchange on payments.

Businesses may have to pay surcharges on international bank payments, even if they are in the same currency, and deal with a Scottish telecoms regulator, Mr Kennard suggested.

"Broadband is not a high-margin business at the best of times, and all of this extra burden is a cost that may mean it is simply not viable for a small internet service provider to bother," he stated.

"Obviously we can't say for sure what would happen - nobody knows the details, assuming Scotland even votes for a split, but it sounds like hassle to me."

Mr Kennard said there could also be an impact for BT, which currently has a universal service obligation covering Scotland.

This means the telecoms firm is required to provide services to remote Scottish islands at "considerable extra cost" to the business.

He said that without Ofcom regualtion, BT may be able to charge the actual cost of serving these communities.

This could have a knock-on effect for small broadband providers - such as AAISP - that deliver services via BT's wholesale network.

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