Doing business in the UK

The UK has an illustrious history of international trade and has traditionally welcomed more foreign investors than most other jurisdictions in Europe. Despite economic and constitutional change, a diverse range of overseas companies and entrepreneurs continue to identify the country as an attractive place to conduct their operations.

Key factors influencing their choice to do business in the UK are its strength in innovation, research and development, its close links to many other markets, its time zone and the fact that English remains the most popular language for international trade. The UK consistently ranks highly in the World Bank’s annual ease of doing business survey and in 2018 has been placed seventh among 190 different countries worldwide.

Recent figures from the Department for International Trade confirm that there has been a steady rise in the level of inward investment over the last ten years. By geography, while the US remains the largest foreign investor in the UK, with record levels of M&A activity by some US acquirers in particular, there are also significant levels of investment from Asia and Europe.

While the impact of the decision to leave the EU on foreign investment is still subject to uncertainty, the UK Government has repeatedly emphasised that the UK will remain very much ‘open for business’, with the country still set to score highly in terms of its flexible trading environment, competitive tax rates, breadth of public services and robust legal framework.

London’s ability to uphold its position as a global hub following the EU referendum has been underlined by being named ‘Europe’s best performing city’ by influential US think tank The Milken Institute. In addition to retaining its status as a top financial centre, London continues to be a leading destination for international tech investors. 

At Penningtons Manches, we have specialists in a broad range of areas likely to be of interest to an incoming business. Our lawyers offer practical guidance on matters such as structuring a UK entity or subsidiary, carrying out acquisitions of businesses and commercial property, commercial contracts and intellectual property law. We also deal with immigration, employment law matters, tax planning and wealth management.

Our Doing business in the UK guide – which can be downloaded here or by using the link in the right hand column - provides a general overview of the key legal and commercial issues which need to be considered by companies when entering the UK market: 

• Setting up a corporate structure
  A number of different types of entities can be set up, depending on the overseas company’s goals. The three most common are a limited company/subsidiary, a branch, and a limited liability partnership.

• UK tax regime
  Whatever corporate structure has been selected, the company, branch or LLP must register with Her Majesty’s Revenue & Customs to pay all its tax liabilities.

• Intellectual property rights
  The UK offers a well-developed regime for the protection and monetisation of intellectual property rights. Many aspects will be familiar to businesses operating internationally.

• Data protection
  The collection and use of personal data is governed by the General Data Protection Regulation which came into force in May 2018. The new legislation has introduced a number of procedural changes in relation to the rights of data subjects.

• Visas and immigration
  Immigration options should be assessed early to avoid any surprises or issues later on. These could include a business being fined for employing individuals who do not have the appropriate visa.

• Employment law
  In comparison with other European countries, the UK has less labour regulation and a more flexible labour market, which make it an ideal location for both businesses and talented individuals to thrive.  

• Trading and regulation
  Some industries are heavily regulated including, notably, the financial services sector. When establishing a presence in the UK, it is important to obtain all the requisite licences to trade.

• Property
  There are four main models of office space available, depending on the needs of the business. The property rights that a company acquires will be determined by the model of office space adopted.

For further information on establishing a presence in the UK or for more detailed guidance on any of the points raised in the brochure, please contact Ross McNaughton in San Francisco.