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The United Kingdom (UK) is an attractive destination for foreign direct investment (FDI) and imposes few impediments to foreign ownership.  The country offers a robust, business-friendly environment to reliably expand trade and invest. It has a mature, high-spending consumer market and an open, liberal economy with world-class talent. Investors have access to a market of 67 million people, diverse suppliers and partners, and benefit from a range of programs to help businesses of all shapes and sizes grow, including a £100 billion infrastructure spending commitment.

Market entry for U.S. firms is facilitated by a common language, legal heritage, and similar business institutions and practices.  The UK is well supported by sophisticated financial and professional services industries and has a transparent tax system in which local and foreign-owned companies are taxed alike.  The pound sterling is a free-floating currency with no restrictions on its transfer or conversion.  There are no exchange controls restricting the transfer of funds associated with an investment into or out of the UK. UK legal, regulatory, and accounting systems are transparent and consistent with international standards.  The UK legal system provides a high level of protection.  Private ownership is protected by law and monitored for competition-restricting behavior.

Prime Minister Rishi Sunak aspires for the UK to be an “innovation nation” and has publicly committed to using science and technology to drive growth and achieve a net-zero carbon emissions economy. Although the UK has been relatively forward leaning on renewable energy in recent years, Russia’s war against Ukraine further accelerated government aims to have more homegrown energy and a more diversified supply of natural gas. On March 30, 2023, the UK government announced a “Powering Up Britain” package that includes an Energy Security Plan, which details efforts to decarbonize the UK’s energy system, and a Net Zero Growth Plan, which includes ambitions in areas such as offshore wind, low-carbon hydrogen, carbon capture and storage, new nuclear, and green finance, among others, with an eye toward a carbon-neutral economy by 2050.

With the onset of the war in Ukraine in February 2022, and the introduction of sanctions against Russia, the UK government accelerated its plans to tackle money laundering by foreign entities. Less than a month after the invasion, Parliament approved the Economic Crime (Transparency and Enforcement) Act 2022, which obliges overseas entities to register beneficial owners of UK properties. Further legislative measures to combat illicit finance may follow.

To facilitate inward foreign investment, the UK government’s Invest in the UK website ( is a comprehensive source of information on the advantages of investing in the UK, current investment opportunities, sector specific background, and government contacts. Over the past decade, the UK has been one of Europe’s top recipients of FDI and it remains the top destination for U.S. outbound investment, totaling more than $1 trillion in 2021. According to the UK’s Office of National Statistics, both the inward and the outward FDI positions (stocks) increased in 2021 compared with 2020; the UK’s inward position increased to £2 trillion ($2.8 trillion), while the outward position increased to £1.8 trillion ($2.5 trillion). However, total net FDI flows into the UK fell to -£51.7 billion ($71.1 billion) in 2021, while net flows abroad totaled £61.7 billion ($84.9 billion) over the same time. The OECD reports inward FDI to the UK totaled $63.3 billion in the first nine months of 2022. The UK government provides comprehensive statistics on FDI in its routine investment updates. 

Currency conversions in this report were calculated using the yearly average exchange rates published by the IRS:  

Table 1: Key Metrics and Rankings
Measure Year Index/Rank/Amount Website Adress
TI Corruption Perceptions Index 2022 18 of 180
Global Innovation Index 2022 4 of 132
U.S. FDI in partner country ($M USD, historical stock positions) 2021 $1,005,470
World Bank GNI per capita 2021 $44,480

Policies Towards Foreign Direct Investment

The UK actively encourages inward FDI.  With a few exceptions, the government does not discriminate between nationals and foreign individuals in the formation and operation of private companies.  The Department for Business and Trade, including through its Office for Investment, actively promotes inward investment and prepares market information for a variety of industries.  U.S. companies establishing British subsidiaries generally encounter no special nationality requirements on directors or shareholders.  Once established in the UK, foreign-owned companies are treated no differently from UK firms.  The UK government is a strong defender of the rights of any UK-registered company, irrespective of its nationality of ownership.

To facilitate inward foreign investment, the UK government’s Invest in the UK website ( ) is a comprehensive source of information on the advantages of investing in the UK, current investment opportunities, sector specific background, and government contacts.

Limits on Foreign Control and Right to Private Ownership and Establishment

In the context of the UK’s departure from the European Union (EU) and the economic challenges posed by COVID-19, His Majesty’s Government has again recognized the importance of attracting inward investment to support the UK’s economic growth. This is evident, for example, through the establishment of the Office for Investment and the centrality of FDI throughout the UK government’s Integrated Review of Security, Defense, Development, and Foreign Policy – of which an updated version was published in March 2023.

The acquisition of UK businesses by foreign-owned companies is recognized as making a valuable contribution to the UK’s economy. However, in some cases such acquisitions are the first step towards taking UK assets out of the country, meaning that strategically important companies, assets, intellectual property and skills are lost overseas. The National Security and Investment Act 2021 came into force in January 2022.  The Act created a national security-based screening regime for investment. The rules apply to acquisitions that are in progress, contemplation, or have been contemplated. If an investor plans an acquisition of a qualifying entity in one of 17 defined sensitive areas of the UK economy, they may need to get approval from the government before completion. This is called a notifiable acquisition. Completing a notifiable acquisition without approval will mean the acquisition is void and may mean that the acquirer is subject to civil or criminal penalties.

The Economic Crime (Transparency and Enforcement) Act 2022 entered into force in March 2022 as part of the Government’s urgent response to the Russian invasion of Ukraine. The Act established a public register, operated by the UK Companies House, of beneficial owners of non-UK entities that own or buy property in the UK. Beneficial owners are those who ultimately own or control an asset. Any overseas entity wishing to own UK land needs to identify their beneficial owners and register them. Not all beneficial owners must register. A beneficial owner generally only needs to be registered if: they hold more than 25 percent of the shares or voting rights in an entity; can appoint the majority of its directors; or have some other significant influence or control over it (including through a trust or partnership structure). This is in line with the threshold for becoming a registrable beneficial owner under the existing people with significant control (PSC) regime for companies. Failure to register (or submitting false information) is a criminal offense and prevents the entity from being able to buy, sell, or mortgage UK property in future. A transfer of land by the overseas entity in breach of the registration requirement is a criminal offense committed by the entity and every responsible officer of it, punishable by a fine or up to five years’ imprisonment.

Other Investment Policy Reviews

There are ample reports on the UK’s investment climate, including reports from multilateral and civil society organizations.

Business Facilitation

The UK government has promoted administrative efficiency to facilitate business creation and operation.  The online business registration process is clearly defined, though some types of companies cannot register as an overseas firm in the UK, including partnerships and unincorporated bodies.  Registration as an overseas company is only required when the company has some degree of physical presence in the UK.  After registering their business with the UK governmental body Companies House, overseas firms must separately register to pay corporation tax within three months.  Since 2016, companies have had to declare all “persons of significant control.”  This policy recognizes that individuals other than named directors can have significant influence on a company’s activity and that this information should be transparent.  More information is available at this link: .

Companies House maintains a free, publicly searchable directory, available at 

Special Section on the British Overseas Territories and Crown Dependencies   

The 14 British Overseas Territories (BOTs) are: Ascension, St Helena, and Tristan da Cunha; Akrotiri and Dhekelia; Anguilla; Bermuda; British Antarctic Territory; British Indian Ocean Territory; British Virgin Islands; Cayman Islands; Falkland Islands (Islas Malvinas); Gibraltar; Montserrat; Pitcairn Islands; Turks and Caicos Islands; and South Georgia and South Sandwich Islands. Ten of the BOTs are permanently inhabited by British nationals.

As a matter of constitutional law, the UK Parliament has unlimited power to legislate for the Territories. Through the UK Privy Council, the UK Government can also issue Orders in Council, which are a form of law allowing changes to be made to Territory laws and constitutions. The UK Privy Council also acts as the final court of appeal for Territory courts.

The UK can also issue instructions to OT Governors to implement certain policies, where the Territory constitution gives the Governor such a power. The UK has responsibility for the defense of the Territories, managing most of their foreign relations, and, usually following consultation, extending international treaties to them that the UK has ratified. In most cases, fiscal policy and liability for Territory debts is not an issue for the UK, but three Territories (Pitcairn, Montserrat, and St Helena and Tristan de Cunha) are eligible for funding from the UK’s budget for official development assistance. Many issues are devolved to Territory Governments and their Governors. This includes immigration policy, internal security like the police, financial services, the environment, and social policy including health and education (though the UK can provide support, such as through the Conflict, Stability, and Security Fund, and has the ultimate power to intervene).

Seven of the BOTs have financial centers:  Anguilla, Bermuda, British Virgin Islands, Cayman Islands, Gibraltar, Montserrat, and the Turks and Caicos Islands.  These territories have committed to the OECD’s Common Reporting Standard (CRS) for the automatic exchange of taxpayer financial account information.  They are already exchanging information with the UK and began exchanging information with other jurisdictions under the CRS from September 2017.

Of the BOTs, Anguilla is the only one to receive a “non-compliant” rating by the OECD Global Forum for Exchange of Information on Request. The British Virgin Islands was rated as “partially compliant” in 2022, and the other five territories were rated as “largely compliant.”  Anguilla, Bermuda, British Virgin Islands, Cayman Islands, Gibraltar, and the Turks and Caicos Islands have committed in reciprocal bilateral arrangements with the UK to hold beneficial ownership information in central registers or similarly effective systems, and to provide UK law enforcement authorities with near real-time access to this information.  These arrangements came into effect in June 2017.

Outward Investment

The UK is one of the largest outward investors in the world. According to the UK Office for National Statistics (ONS), the country’s international investment position abroad (outward investment) in 2021 was nearly £1.8 trillion ($2.5 trillion). The top destination for UK outward FDI was the European Union, though the United States was the largest single-country recipient, accounting for approximately 26 percent of UK outward FDI flows in 2021.  Other key destinations include the Netherlands, Luxembourg, France, and Spain, which, combined with the United States, account for a little over half of the UK’s outward FDI stock.  The European Union and the Americas remain the dominant areas for UK international investment positions. The Department of Business and Trade (formerly Department of International Trade) maintains offices and personnel in the United States and other countries around the world to assist UK businesses with export and expansion activities.

The UK has 85 bilateral investment treaties currently in force, which are known in the UK as Investment Promotion and Protection Agreements.  The UK does not have a bilateral investment treaty with the United States. The two countries signed a bilateral taxation treaty in 2001, however. For a complete current list of related UK treaties, including actual treaties, see: 

The United Kingdom is a member of the OECD Inclusive Framework on Base Erosion and Profit Shifting (BEPS) and the Inclusive Framework’s October 2021 agreement on the global minimum corporate tax.

Transparency of the Regulatory System

U.S. exporters and investors generally will find little difference between the United States and UK in the conduct of business.  The UK’s regulatory system provides clear and transparent guidelines for commercial engagement.  Common law prevails in the UK as the basis for commercial transactions, and the International Commercial Terms (INCOTERMS) of the International Chambers of Commerce are accepted definitions of trading terms.  In terms of accounting standards and audit provisions, firms in the UK must use the UK-adopted international accounting standards (IAS) instead of the EU-adopted IAS for financial years beginning on or after January 1, 2021.  The UK’s Accounting Standards Board provides guidance to firms on accounting standards and works with the IASB on international standards.

Statutory authority over prices and competition in various industries is given to independent regulators, for example the Office of Communications (Ofcom), the Water Services Regulation Authority (Ofwat), Water Industry Commission for Scotland (WICS), the Office of Gas and Electricity Markets (Ofgem), the Office of Fair Trading (OFT), the Office of Rail and Road (ORR), the Prudential Regulatory Authority (PRA), and the Financial Conduct Authority (FCA).  The PRA was created out of the dissolution of the Financial Services Authority (FSA) in 2013.  The PRA reports to the Financial Policy Committee (FPC) in the Bank of England.  The PRA is responsible for supervising the safety and soundness of individual financial firms, while the FPC takes a systemic view of the financial system and provides macro-prudential regulation and policy actions.  The FCA is a regulatory enforcement mechanism designed to address financial and market misconduct through legally reviewable processes.  These regulators work to protect the interests of consumers while ensuring that the markets they regulate are functioning efficiently.  Most laws and regulations are published in draft for public comment prior to implementation.  The FCA maintains a free, publicly searchable register of their filings on regulated corporations and individuals here: .

The UK government publishes regulatory actions, including draft text and executive summaries, at: 

International Regulatory Considerations

The UK’s withdrawal from the EU has not caused dramatic shifts in the UK’s regulatory regimes but has opened the door to regulatory divergence.  The future regulatory direction of the UK remains uncertain as the UK determines whether to maintain the current regulatory regime inherited from the EU or to move towards new regulations.  The UK is an independent member of the WTO and actively seeks to comply with all WTO obligations.

His Majesty’s Government introduced in September 2022 a proposed Retained EU Law (Revocation and Reform) Bill, colloquially referred to as the “Brexit Freedoms Bill.” If the bill passes in its original form, some 4,000 EU-derived laws and regulations still applied in the UK will “sunset,” or cease to have effect, at the end of 2023 (or 2026 in some circumstances), absent ministers’ action to keep them on the statute book as “assimilated” law.  At the time of writing, the bill is still completing its parliamentary passage. The tight deadline to review such a wide-ranging body of EU-derived legislation has raised concerns among business groups and legal experts.

Legal System and Judicial Independence

The UK is a common-law country.  UK business contracts are legally enforceable in the UK, but not in the United States or other foreign jurisdictions.  International disputes are resolved through litigation in the UK Courts or by arbitration, mediation, or some other alternative dispute resolution (ADR) method.  The UK has a long history of applying the rule of law to business disputes.  The current judicial process remains procedurally competent, fair, and reliable, which helps position London as an international hub for dispute resolution with over 10,000 cases filed per annum.

Laws and Regulations on Foreign Direct Investment

The procedure for establishing a company in the UK is identical for British and foreign investors.  No approval mechanisms exist for foreign investment, apart from the process outlined in Section 1.  Foreigners may freely establish or purchase enterprises in the UK, with a few limited exceptions, and acquire land or buildings.

The National Security and Investment Act 2021 – which applies equally to foreign or domestic investment – requires mandatory reporting of significant investments (generally over 25 percent control) in 17 sensitive sectors; the reporting requirement extends to investments in intellectual property and in higher education and research.  The UK government aims to review cases expeditiously, with most reviews of notifications completed within 30 days.

The Register of Overseas Entities came into force in the UK on August 1, 2022, through the Economic Crime (Transparency and Enforcement) Act 2022. Overseas entities that want to buy, sell or transfer property or land in the UK must register with Companies House and provide information on registrable beneficial owners or managing officers. The Act requires registry of ultimate beneficial owners, including those controlling at least 25 percent of overseas entities that own such property.  Entities or their officers who refuse to register or keep their information up to date face restrictions on selling the property, and those who violate the rules could face a fine of up to £2,500 ($3,082) per day and up to five years in prison.

Register an overseas entity: 

Foreign are subject to the same tax laws as UK firms. Foreign investors, however, may have access to certain UK regional grants and incentives designed to attract industry to areas of high unemployment, but these do not include tax concessions.

Competition and Antitrust Laws

The UK competition regime is established by the Competition Act 1998 and the Enterprise Act 2002, as amended by the Enterprise and Regulator Reform Act 2013.  This legislative framework created the UK’s independent competition authority, the Competition and Markets Authority (CMA), which is responsible for enforcing UK competition law.  The government has limited powers to intervene in either the assessment of mergers or the investigation of markets.

Before Brexit, the prohibitions in UK law on abusing dominant market positions and anti-competitive agreements were based on and underpinned by equivalent provisions in EU law.  Since Brexit, under the terms of the UK-EU trade agreements, EU competition law is no longer enforced in the UK, and the UK and EU now operate separate competition regimes.

The CMA is responsible for:

  • investigating phase 1 and phase 2 mergers,
  • conducting market studies and market investigations,
  • investigating possible breaches of prohibitions against anti-competitive agreements under the Competition Act 1998,
  • bringing criminal proceedings against individuals who commit cartel offenses,
  • enforcing consumer protection legislation,
  • encouraging sectoral regulators to use their powers to protect competition,
  • considering regulatory references and appeals, and,
  • regulation of public sector subsidies to business.

While merger notification in the UK is voluntary, the CMA may impose substantial fines or suspense orders on potentially non-compliant transactions.  The CMA has no prosecutorial authority, but it may refer entities for prosecution in extreme cases, such as those involving cartel activity, which carries a penalty of up to five years imprisonment.

In 2021, the UK established the Digital Markets Unit- (DMU) on a non-statutory basis within the CMA to oversee and operationalize a forthcoming pro-competition regime for digital markets.  Powers for the DMU and the new regulatory regime will require new legislation.  The UK government committed to bringing forward a new Digital Markets, Competition, and Consumer Bill during the 2022-23 parliamentary session, which is expected to end in the fall of 2023. At the time of writing, the bill has not yet been tabled. In the interim, the DMU is supporting and advising the government on establishing the statutory regime, including by gathering evidence on digital markets.

In addition to the CMA, the Takeover Panel, the Financial Conduct Authority, and the Pensions Regulator have principal regulatory authority:

  • The Takeover Panel is an independent body, operating per the City Code on Takeover and Mergers  (the “Code”), which regulates takeovers of public companies, and some private companies, centrally managed or controlled in the UK, the Isle of Man, Jersey, and Guernsey.  The Code provides a binding set of rules for takeovers aimed at ensuring fair treatment for all shareholders in takeover bids, including requiring bidders to provide information about their intentions after a takeover.
  • The Financial Conduct Authority administers Listing Rules, Prospectus Regulation Rules, and Disclosure Guidance and Transparency Rules, which can apply to takeovers of publicly listed companies.
  • The Pensions Regulator has powers to intervene in investments in pension schemes.

Expropriation and Compensation

The UK is a member of the OECD and adheres to the OECD principle that when a government expropriates property, compensation should be timely, adequate, and effective.  In the UK, the right to fair compensation and due process is uncontested and is reflected in all international investment agreements.  Expropriation of corporate assets or the nationalization of industry requires a special act of Parliament.

Dispute Settlement

ICSID Convention and New York Convention

In addition to its membership in the International Center for Settlement of Investment Disputes (ICSID) Convention, the UK is a signatory to the New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards.

The United Kingdom has elected not to follow the United National Commission on International Trade Law (UNCITRAL) Model Law on International Commercial Arbitration.  Enforcement of an arbitral award in the UK is dependent upon where the award was granted.  The process for enforcement in any particular case is dependent upon the seat of arbitration and the arbitration rules that apply.  Arbitral awards in the UK can be enforced under a number of different regimes, namely:  The Arbitration Act 1996, The New York Convention, The Geneva Convention 1927, The Administration of Justice Act 1920 and the Foreign Judgments (Reciprocal Enforcement) Act 1933, and Common Law.

The Arbitration Act 1996 governs all arbitrations seated in England, Wales, and Northern Ireland, both domestic and international.  The full text of the Arbitration Act can be found here: .

The Arbitration Act is heavily influenced by the UNCITRAL Model Law, but it has some important differences.  For example, the Arbitration Act covers both domestic and international arbitration; the document containing the parties’ arbitration agreement need not be signed; an English court is only able to stay its own proceedings and cannot refer a matter to arbitration; the default provisions in the Arbitration Act require the appointment of a sole arbitrator as opposed to three arbitrators; a party retains the power to treat its party-nominated arbitrator as the sole arbitrator in the event that the other party fails to make an appointment (where the parties’ agreement provides that each party is required to appoint an arbitrator); there is no time limit on a party’s opposition to the appointment of an arbitrator; parties must expressly opt out of most of the provisions of the Arbitration Act which confer default procedural powers on the arbitrators; and there are no strict rules governing the exchange of pleadings.  Section 66 of the Arbitration Act applies to all domestic and foreign arbitral awards.  Sections 100 to 103 of the Arbitration Act provide for enforcement of arbitral awards under the New York Convention 1958.  Section 99 of the Arbitration Act provides for the enforcement of arbitral awards made in certain countries under the Geneva Convention 1927.

Under Section 66 of the Arbitration Act, the court’s permission is required for an international arbitral award to be enforced in the UK.  Once the court has given permission, judgment may be entered in terms of the arbitral award and enforced in the same manner as a court judgment or order.  Permission will not be granted by the court if the party against whom enforcement is sought can show that (a) the tribunal lacked substantive jurisdiction and (b) the right to raise such an objection has not been lost.

The length of arbitral proceedings can vary greatly.  If the parties have a relatively straightforward dispute, cooperate, and adopt a fast-track procedure, arbitration can be concluded within months or even weeks.  In a substantial international arbitration involving complex facts, many witnesses and experts and post-hearing briefs, the arbitration could take many years.  A reasonably substantial international arbitration will likely take between one and two years.

Two alternative procedures can be followed in order to enforce an award.  The first is to seek leave of the court for permission to enforce.  The second is to begin an action on the award, seeking the same relief from the court as set out in the tribunal’s award.  Enforcement of an award made in the jurisdiction may be opposed by challenging the award.  The court may also, however, refuse to enforce an award that is unclear, does not specify an amount, or offends public policy.  Enforcement of a foreign award may be opposed on any of the limited grounds set out in the New York Convention.  A stay may be granted for a limited time pending a challenge to the order for enforcement.  The court will consider the likelihood of success and whether enforcement of the award will be made more or less difficult as a result of the stay.  Conditions that might be imposed on granting the stay include such matters as paying a sum into court.  Where multiple awards are to be rendered, the court may give permission for the tribunal to continue hearing other matters, especially where there may be a long delay between awards.  UK courts have a good record of enforcing arbitral awards.  The courts will enforce an arbitral award in the same way that they will enforce an order or judgment of a court.  At the time of writing, there are no examples of the English courts enforcing awards which were set aside by the courts at the place of arbitration.

Most awards are complied with voluntarily.  If the party against whom the award was made fails to comply, the party seeking enforcement can apply to the court.  The length of time it takes to enforce an award which complies with the requirements of the New York Convention will depend on whether there are complex objections to enforcement which require the court to investigate the facts of the case.  If a case raises complex issues of public importance the case could be appealed to the Court of Appeal and then to the Supreme Court.  This process could take around two years.  If no complex objections are raised, the party seeking enforcement can apply to the court using a summary procedure that is fast and efficient.  There are time limits relating to the enforcement of the award.  Failure to comply with an award is treated as a breach of the arbitration agreement.  An action on the award must be brought within six years of the failure to comply with the award or 12 years if the arbitration agreement was made under seal.  If the award does not specify a time for compliance, a court will imply a term of reasonableness.

Investor-State Dispute Settlement

As a member of ICSID, the UK accepts binding international arbitration between foreign investors and the State.  As a signatory to the New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards, the UK provides local enforcement on arbitration judgments decided in other signatory countries.

London is a thriving center for the resolution of international disputes through arbitration under a variety of procedural rules such as those of the London Court of International Arbitration, the International Chamber of Commerce, the Stockholm Chamber of Commerce, the American Arbitration Association International Centre for Dispute Resolution, and others.  Many of these arbitrations involve parties with no connection to the jurisdiction, but who are drawn to the jurisdiction because they perceive it to be a fair, neutral venue with an arbitration law and courts that support efficient resolution of disputes.  They also choose London-based arbitration because of the general prevalence of the English language and law in international commerce.  A wide range of contractual and non-contractual claims can be referred to arbitration in this jurisdiction including disputes involving intellectual property rights, competition, and statutory claims.  There are no restrictions on foreign nationals acting as arbitration counsel or arbitrators in this jurisdiction.  There are few restrictions on foreign lawyers practicing in the jurisdiction, as evidenced by the fact that over 200 foreign law firms have offices in London.

International Commercial Arbitration and Foreign Courts

Bankruptcy Regulations

The UK has strong bankruptcy protections going back to the Bankruptcy Act of 1542.  Today, both individual bankruptcy and corporate insolvency are regulated in the UK primarily by the Insolvency Act 1986, the Insolvency Rules 1986, and the Corporate Insolvency and Governance Act 2020, regulated through determinations in UK courts.

Regarding individual bankruptcy law, the court will oblige a bankrupt individual to sell assets to pay dividends to creditors.  A bankrupt person must inform future creditors about the bankrupt status and may not act as the director of a company during the period of bankruptcy.  Bankruptcy is not criminalized in the UK, and the Enterprise Act of 2002 dictates that for England and Wales bankruptcy will not normally last longer than 12 months.  At the end of the bankrupt period, the individual is normally no longer held liable for bankruptcy debts unless the individual is determined to be culpable for his or her own insolvency, in which case the bankruptcy period can last up to 15 years.

For corporations declaring insolvency, UK insolvency law seeks to distribute losses equitably between creditors, employees, the community, and other stakeholders in an effort to rescue the company.  Liability is limited to the amount of the investment.  If a company cannot be rescued, it is liquidated and assets are sold to pay debts to creditors, including foreign investors.

Liquidation and Insolvency: 

Investment Incentives

The UK’s Department for Business and Trade (DBT) works with its partner organizations in the devolved administrations – Scottish Development International, the Welsh Government, and Invest Northern Ireland – and with London and Partners and Local Enterprise Partnerships (LEPs) throughout England – to promote inward investment into each country’s priority and emerging sectors. Throughout the UK, there are a range of incentive programs aimed at attracting investment into employment-generating enterprises in rural and economically fragile areas.

Local authorities in England and Wales also have power under the Local Government and Housing Act of 1989 to promote the economic development of their areas through a variety of assistance schemes, including the provision of grants, loan capital, property, or other financial benefit.  Separate legislation, granting similar powers to local authorities, applies to Scotland and Northern Ireland.

Scottish Enterprise is Scotland’s national economic development agency. It aims to drive business innovation, build international competitiveness, and encourage inward investment. Its partners Highlands and Islands Enterprise and South of Scotland Enterprise focus on economic support and development in the rural north and south of the nation, respectively.

Invest NI is the economic development agency for Northern Ireland.  Invest NI provides guidance and support to businesses seeking to invest in Northern Ireland throughout the lifespan of their investment.  This support includes grants for employment, R&D, training, and assistance with recruitment and real estate.

HMG offers tax incentives for businesses that purchase new:

  • Electric cars and cars with zero CO2 emissions
  • Plant and machinery for gas refueling stations, for example storage tanks, pumps
  • Gas, biogas and hydrogen refueling equipment
  • Zero-emission goods vehicles
  • Equipment for electric vehicle charging points
  • Plant and machinery for use in a freeport tax site

If businesses buy an eligible asset, they can deduct the full cost from their profits before tax.  They cannot normally claim on items bought to lease to other people or for use within a home they let out.  Most analysts suggest these incentives have helped uptake of green vehicles.

HMG’s Feed-In Tariff Scheme (FITS) ran from 2010 and was closed to new entrants in 2019.  FITS helps to promote the uptake of renewable and low-carbon electricity generation technologies through payments made for the electricity a business generates and exports.  The scheme has been replaced by the contracts for difference scheme, paying low-carbon electricity generators (mainly wind farms) a minimum agreed price, should market prices fall below that level. The generators pay back the difference should market prices exceed an agreed maximum price.

Beginning April 1, 2023, the UK government introduced a 100 percent first-year deduction for the purchase of certain plants and equipment – commonly known as “full expensing.” The measure will remain in place until March 31, 2026, and covers items ranging from warehousing and construction equipment (e.g., forklift trucks, bulldozers, and excavators) to vehicles, desks, and computers. The UK government also extended until March 31, 2026, the 50 percent first-year deduction for the purchase of so-called “special rate assets” – e.g., solar panels and thermal insulation on buildings.

In March 2023, His Majesty’s Government (HMG) released a series of announcements in what was previously billed as a “Green Day” and has now been rebranded as a two-part plan called “ Powering Up Britain.” The package includes an Energy Security Plan, which details efforts to decarbonize the UK’s energy system by investing further in carbon capture, usage, and storage (CCUS), hydrogen, offshore wind, and increasing household energy efficiency. The second part is a Net Zero Growth Plan, which responds to the January 2023 independent Net Zero Review and the July 2022 UK High Court decision mandating HMG update its current Net Zero Strategy to meet its legally-binding net zero targets. These plans were augmented by the publication of HMG’s Green Finance Strategy and International Climate Finance Strategy, both aimed at mobilizing public and private sector finance to accelerate the global economy-wide transition to net zero.

Foreign Trade Zones/Free Ports/Trade Facilitation

In March 2021, the UK government identified eight sites as post-Brexit freeports to spur trade, investment, innovation, and economic recovery.  The eight sites are: East Midlands Airport, Felixstowe and Harwich, Humber, Liverpool City Region, Plymouth and South Devon, Solent, Thames, and Teesside.  Three of those freeports (Teesside, Plymouth and South Devon, and Solent) received final government approval in December 2022, and a further two (Felixstowe and Harwich and Liverpool City Region) did so in January 2023. Separately, the UK government announced in early 2023 that Inverness and Cromarty Firth and the Firth of Forth would host two green freeports in Scotland, while Anglesey and Port Talbot and Milford Haven would be home to two freeports in Wales. No freeports have been announced for Northern Ireland as of this writing.

The new Freeports benefit from not only customs measures, but a range of tax reliefs, enhanced support for trade promotion and innovation, seed capital to help pay for infrastructure and other enabling activities, and full local retention of business rates revenue from new and expanded developments located in the Freeports. This makes them more substantive special economic zones (SEZs) than previous UK Freeports.

In addition, councils covering Freeports are being encouraged to make use of existing powers to relax the usual planning regime, such as via local development orders, which involves pre-approving certain types of developments, although they not be mandated to do so. Alongside other partners in their Freeports, they also have to put in place a skills and employment strategy to help local residents, particularly from deprived or otherwise traditionally disadvantaged backgrounds, to obtain the new jobs created, and strategies for innovation and decarbonization. Seed capital and any additional retained business rates revenues generated can be used to fund these strategies.

Each Freeport is a maximum of 45 km in diameter. Within its outer boundary, it will include a number of ‘customs sites’ where the customs measures are in place, and between one and three ‘tax sites’ where the tax reliefs and increased local retention of growth in business rates revenues will apply. The tax sites are required to be ‘under-developed’ land and limited to 6 km2 per Freeport.

With the exception of some simplified declaration and authorization processes, the customs measures can already be applied for by businesses elsewhere in the UK. The tax measures are more significant, albeit temporary, and include enhanced allowances for investment and generous reliefs from employer National Insurance contributions (NICs), business rates and stamp duty land tax.

The benefits available to Freeports in Scotland and Wales will be almost identical to those in England: although some elements of the scheme are devolved, the Scottish and Welsh Governments have agreed to largely mirror the situation in England. The situation for Northern Ireland is more complex as the Northern Ireland Protocol to the Brexit agreement and the recent Windsor Framework may mean it is not possible to offer the full set of tax reliefs and other measures available elsewhere in the UK, although it may be possible to offer alternative benefits instead.

Performance and Data Localization Requirements

The EU’s General Data Protection Regulation (GDPR) is retained in domestic UK law as the UK GDPR, though the UK has the independence to keep the framework under review.  Entities based in the UK must also continue to comply with the amended version of the Data Protection Act (DPA) 2018, which sits alongside UK GDPR.  The Information Commissioner’s Office (ICO) is the UK’s independent data protection authority.

The UK permits transfers of data from the UK to the European Economic Area (EEA).  In 2021, the EU Commission published data adequacy decisions for the UK.  As a result, data transfers from the EEA to the UK are permitted in most cases.  Transfers of personal data for the purposes of UK immigration control, or which would otherwise fall within the scope of the immigration exemption in the DPA 2018, are excluded from the scope of the adequacy decision.

While the UK GDPR does not impose data localization requirements, it requires controllers and processors of personal data to put in place appropriate technical and organizational measures to implement data protection effectively and safeguard individual rights.  This may include an organization’s appointment of a data protection officer (DPO).  A DPO is anyone an organization appoints to monitor internal compliance, inform and advise on data protection obligations, provide advice regarding Data Protection Impact Assessments (DPIAs), and act as a contact point for data subjects and the ICO.  A DPO can be an existing employee or externally appointed, but must be independent, an expert in data protection, adequately resources, and report to the highest management level.

The UK government tabled on March 8, 2023, the Data Protection and Digital Information (No. 2) Bill, which includes proposed changes to both the DPA and UK GDPR. The timeline for the bill’s passage through both Houses of Parliament is unclear at the time of writing.

Real Property

The UK has robust real property laws stemming from legislation including the Law of Property Act 1925, the Settled Land Act 1925, the Land Charges Act 1972, the Trusts of Land and Appointment of Trustees Act 1996, and the Land Registration Act 2002.

Interests in property are well enforced, and mortgages and liens have been recorded reliably since the Land Registry Act of 1862.  The Land Registry is the government database where all land ownership and transaction data are held for England and Wales, and it is reliably accessible online: . Scotland has its own Registers of Scotland, while Northern Ireland operates land registration through the Land and Property Services.

Long-term physical presence on non-residential property without permission is not typically considered a crime in the UK.  Police act if squatters commit other crimes when entering or staying in a property.

Intellectual Property Rights

The UK legal system provides a high level of intellectual property rights (IPR) protection.  Enforcement mechanisms are comparable to those available in the United States.  The UK is a member of the World Intellectual Property Organization (WIPO).  The UK is also a member of the following major intellectual property protection agreements: the Bern Convention for the Protection of Literary and Artistic Works, the Paris Convention for the Protection of Industrial Property, the Universal Copyright Convention, the Geneva Phonograms Convention, and the Patent Cooperation Treaty.  The UK has signed and, through implementing various EU Directives, enshrined into UK law the WIPO Copyright Treaty (WCT) and WIPO Performance and Phonograms Treaty (WPPT), known as the internet treaties.

The Intellectual Property Office (IPO) is the official UK government body responsible for intellectual property rights, including patents, designs, trademarks, and copyright.  The IPO web site contains comprehensive information on UK law and practice in these areas: .

According to the Intellectual Property Crime Report (IPCR) for 2019/20, imports of counterfeit and pirated goods to the UK accounted for as much as £13.6 billion ($18.8 billion) in 2016 – the equivalent of three percent of UK imports in genuine goods.  The most recent IPCR for 2020/2021 does not quantify the UK’s counterfeit imports.

The UK is not on the Special 301 Report nor on the Notorious Markets List.

For additional information about national laws and points of contact at local IP offices, please see WIPO’s country profiles at .

Capital Markets and Portfolio Investment

London houses one of the oldest and most developed financial markets in the world.  London offers the full range of financial services underpinned by high quality regulation and strong standards of disclosure and transparency, a supportive market infrastructure, and a dynamic, highly skilled workforce.

The UK government is generally hospitable to foreign portfolio investment.  Government policies are intended to facilitate the free flow of capital and to support the flow of resources in product and services markets.  Foreign investors are able to obtain credit in local markets at normal market terms, and a wide range of credit instruments are available.  The principles underlying legal, regulatory, and accounting systems are transparent, and they are consistent with international standards.  In all cases, regulations have been published and are applied on a non-discriminatory basis by the Bank of England’s Prudential Regulation Authority (PRA).

London’s markets have historically been the main financial hub serving the EU and have the advantage of bridging the gap between the day’s trading in the Asian markets and the opening of the U.S. market.  Despite the pandemic and Brexit, the UK retains its global place and has the lead in trading in areas such as foreign exchange, cross border bank lending, and international insurance premium income.  Starting in early 2021, the UK government, based on the review of the London listing regime led by Lord Hill, the UK’s former European Commissioner for Financial Services, has introduced a series of reforms to the UK’s listing regime to improve its competitiveness and enhance London’s attractiveness as a listing location for innovative and high growth businesses.  In May 2017, the LSE launched a new market for non-equity securities, known as the International Securities Market (ISM).  This market is aimed at professional investors and is outside the scope of the UK Prospectus Regulation regime.  The Alternative Investment Market (AIM), established in 1995 as a sub-market of the London Stock Exchange, is specifically designed for smaller, rapidly expanding companies.  The AIM has a more flexible regulatory system than the main market and has no minimum market capitalization requirements.  During its first 25 years, the AIM has raised £118 billion ($145 billion) for more than 3,800 companies.

Money and Banking System

The UK banking sector assets totaled £9.8 trillion ($12.4 trillion) at the end of the third quarter of 2022, the fifth largest in the world and the second largest in Europe, just behind France ($12.6 trillion). In 2021, the financial services sector contributed £173.6 billion ($238.8.7 billion) to the UK economy, accounting for 8.3 percent of total economic output.  There were nearly 1.1 million financial services jobs in the UK in Q1 2022, accounting for three percent of all jobs.  The long-term impact of Brexit and the pandemic on the financial services industry has been minor so far.  Some firms continue to move limited numbers of jobs outside the UK to service EU-based clients, but the UK is anticipated to remain a top financial hub.

The Bank of England (BoE) is the central bank of the UK.  According to its guidelines, foreign banking institutions are legally permitted to establish operations in the UK as subsidiaries or branches.  More than 200 foreign banks have branches in London, and London serves as an important center for global private and investment banking firms.  Responsibilities for the prudential supervision of a foreign branch are split between the parent’s home state supervisors and the Prudential Regulation Authority (PRA).  The PRA, however, expects the whole firm to meet the PRA’s threshold conditions.  The PRA expects new foreign branches to focus on wholesale and corporate banking and to do so at a level that is not critical to the UK economy.  The Financial Conduct Authority (FCA) is the regulator for all financial services firms and financial markets operating in the United Kingdom.  For foreign bank branches operating in the UK, the FCA’s Threshold Conditions and conduct of business rules apply, including rules in areas such as anti-money laundering.  Eligible deposits placed in foreign branches may be covered by the UK deposit guarantee program and therefore foreign branches may be subject to regulations concerning UK depositor protection.

There are no legal restrictions that prohibit foreign residents from opening a business bank account; setting up a business bank account as a non-resident is in principle straightforward.   In practice, however, most banks will not accept applications from overseas due to fraud concerns and the additional administration costs.  To open a personal bank account, an individual must, at minimum, present an internationally recognized proof of identification and prove residency in the UK.  This is a problem for incoming FDI and American expatriates.  Unless the business or the individual can prove UK residency, they will have limited banking options.

The UK government tabled in July 2022 the Financial Services and Markets Bill (FSMB), whose aim is to create the conditions for wide-ranging reform of the UK’s financial services regulatory model, including by revoking and replacing hundreds of pieces of EU-derived legislation – a process the UK government expects will take “a number of years.” The bill has not yet completed its parliamentary passage at the time of writing.

Foreign Exchange and Remittances

Foreign Exchange

The pound sterling is a free-floating currency with no restrictions on its transfer or conversion.  Exchange controls restricting the transfer of funds associated with an investment into or out of the UK are not exercised.

Remittance Policies

The remittance basis is an alternative tax treatment that’s available to individuals who are resident but not domiciled in the UK and have foreign income and gains. Remittance basis is not available if you are deemed domicile in the UK. You will be deemed domicile if you were born in the UK with UK domicile of origin and UK resident in 2020 to 2021 tax year, or you have been UK resident for at least 15 of the previous 20 tax years and UK resident in 2020 to 2021 tax year.

If you are taxable on the remittance basis, you are liable to UK tax in the normal way on your UK source income and gains. But you’re only liable to UK tax on any remittances (amounts) of foreign income and gains that you remit to the UK (see below for what we mean by ‘remitted to the UK’). If you choose to be taxed on the remittance basis you must include these remittances on your tax return.

Remittance basis 2021 (updated April 2023): 

Residence, domicile, and the remittance basis: 

Sovereign Wealth Funds

The United Kingdom does not maintain a national wealth fund.  Although there have at times been calls to turn The Crown Estate – created in 1760 by Parliament as a means of funding the British monarchy – into a wealth fund, there are no current plans to do so.  Moreover, with net assets of just over $20 billion in 2021/22, The Crown Estate would be small in relation to other national funds.

UK Government Investments (UKGI) Limited, a company owned by His Majesty’s Treasury (HMT), acts as the shareholder for a portfolio of 23 partially or fully state-owned enterprises on behalf of seven government departments. These enterprises employ over 215,000 people and range from large, well-known companies to non-ministerial departments.  The full list features in UKGI’s annual report:  (see page 15). UKGI also represents the UK at the OECD Working Party on State Ownership and Privatization Practices. Since privatizing the oil and gas industry, the UK has not established any new energy-related state-owned enterprises or resource funds.

Privatization Program

The privatization of state-owned utilities in the UK is now essentially complete.  As regards future investment opportunities, the remaining government-owned enterprises or government shares in other utilities are likely to be sold off to the private sector when market conditions improve.

Businesses in the UK are accountable for a due-diligence approach to responsible business conduct (RBC), or corporate social responsibility (CSR), in areas such as human resources, environment, sustainable development, and health and safety practices – through a wide variety of existing guidelines at national and global levels.  There is a strong awareness of CSR principles among UK businesses, promoted by UK business associations such as the Confederation of British Industry and the UK government.

The British government fairly and uniformly enforces laws related to human rights, labor rights, consumer protection, environmental protection, and other statutes intended to protect individuals from adverse business impacts.  The UK government adheres to the OECD Guidelines for Multinational Enterprises.  It is committed to the promotion and implementation of these Guidelines and encourages UK multinational enterprises to adopt high corporate standards involving all aspects of the Guidelines.  The UK established in 2000 a National Contact Point (NCP) to promote the Guidelines and facilitate the resolution of disputes that may arise within that context.  The NCP is part of the Department for Business and Trade.  A Steering Board monitors the work of the UK NCP and provides strategic guidance.  It is composed of representatives of relevant government departments, external members from stakeholder groups such as business organizations, trade unions, and NGOs, and one independent unaffiliated member.

Information on UK regulations and policies relating to the procurement of supplies, services and works for the public sector, and the relevance of promoting RBC, are found here:

The UK government tabled in May 2022 the Procurement Bill, which aims to streamline the public procurement process by consolidating the existing four sets of regulations – which still mirror EU legislation the UK government kept on the statute book upon departure from the bloc – into a single regime. As part of these reforms, the UK government also aims to establish a single platform for accessing procurement data. The Procurement Bill is still completing its parliamentary passage as of this writing.

The 2015 Modern Slavery Act requires commercial organizations with a total turnover of £36 million ($44.4 million) or more, known as covered organizations, to publish an annual modern slavery statement. A commercial organization means a body corporate, wherever incorporated, or a partnership, wherever formed, which supplies goods or services, and carries on a business or part of a business in any part of the U.K. A modern slavery statement is a statement of the steps the organization has taken during the financial year to ensure that slavery and human trafficking does not take place in its supply chains or in any parts of its business, or a statement that the organization has taken no such steps. The act does not dictate the format or content of modern slavery statements. It provides that covered organizations “may” include in their statement information on six areas:

  1. The organization’s structure, its business and its supply chains;
  2. Its relevant policies;
  3. Its relevant due diligence processes;
  4. Those parts of its business and supply chains where there is a risk of modern slavery and the steps it has taken to assess and manage that risk;
  5. Its effectiveness in ensuring that modern slavery is not taking place in its business or supply chains; and
  6. The training about modern slavery available to its staff.

The current regime relies on public scrutiny, including scrutiny by nongovernmental organizations and journalists, to motivate companies to be transparent about the steps they have taken to tackle modern slavery. Covered organizations must publish their modern slavery statement on their website and include a link to the statement in a prominent place on the website’s homepage. Organizations failing to comply with the requirements of the act currently face no sanctions, beyond the risk of damage to their reputation.

Additional Resources

Department of State

Department of the Treasury

Department of Labor

Climate Issues

In October 2021, the UK government introduced its Net Zero Strategy (NZS), setting out plans to cut emissions, seize green economic opportunities, and use private investment to achieve a net zero economy by 2050.

The UK government committed to achieving several goals in its NZS, including:

1.     Quadruple offshore wind capacity by 2030
2.      5GW of low carbon hydrogen production capacity by 2030
3.     End the sale of new gasoline and diesel cars and vans by 2030
4.    Install 600,000 heat pumps in homes by 2028
5.      Capture and store 10Mt of CO2 per year by 2030
6.      Restoring approximately 280,000 hectares of peat in England by 2050 and trebling woodland creation rates in England, contributing to the UK’s overall target of increasing planting rates to 30,000 hectares per year by the end of the Parliament
7.     Eco-labelling regulation introduction by the late 2020s
8.     Introduce Local Nature Recovery Strategies (LNRS), a spatial planning tool for nature, which allows local government and communities to identify priorities and opportunities for nature recovery and nature-based solutions across England.

To achieve these goals, the UK government implemented several incentive and seed funding programs. For example, through the Boiler Upgrade Scheme, homeowners can receive up to £6,000 towards the purchase of a heat pump, which is meant to move households away from a reliance on gas-fueled boilers. To support the transition away from fossil-fuel reliant vehicles, the UK government established the Automotive Transformation Fund, which provides up to £850 million to develop a high-value, end-to-end electrified automotive supply chain. By and large, these incentive and investment programs are being implemented and enforced, although critics say the allocation of funding from the government can sometimes get caught up in bureaucracy.

However, following a High Court ruling in July 2022, which found that the NZS did not provide sufficient details as to how those targets would be met, and the publication in January 2023 of an independent review of the NZS, which included 129 recommendations, the UK government unveiled in March 2023 a revamped “Powering Up Britain” strategy. The new documents offer additional details but, according to critics, largely repackage previously announced policies and incentive programs.

As part of the “Powering Up Britain” strategy, the UK government launched a consultation, due to close in June 2023, on a potential Carbon Border Adjustment Mechanism (CBAM) and is also expected to consult on a previously delayed Green Taxonomy in the fall of 2023. The 2023 Green Finance Strategy sets out how the UK government seeks to be at the forefront of the growing global market and meet UK climate and nature objectives.

The UK government’s public procurement policy states that contracting authorities should consider 1) creating new businesses, new jobs and new skills; 2) tackling climate change and reducing waste; 3) improving supplier diversity, innovation and resilience, alongside any additional local priorities in their procurement activities.

The 2021 Environment Act sets out the framework to improve air and water quality, tackle waste, increase recycling, halt the decline of species, and improve the natural environment. Under the Act, new legally binding targets were introduced in 2023 including on air quality, water, waste reduction, increasing woodland cover, improving marine protected areas, and halting the decline in species by 2030. The Environmental Improvement Plan 2023 also updated UK government plans to deliver on goals set out in the overarching 25 Year Environment Plan published in 2018. A Plant Biosecurity Strategy for Great Britain published in 2023 is aimed at creating a new biosecurity regime and bio-secure plant supply chain. A Nature Markets Framework strategy was published in March 2023 to help achieve the government’s goal to grow annual private investment flows to nature in England by over £1 billion by 2030.

Although isolated instances of bribery and corruption have occurred in the UK, U.S. investors have not identified corruption of public officials as a factor in doing business in the UK.

The Bribery Act 2010 amended and reformed UK criminal law and provided a modern legal framework to combat bribery in the UK and internationally.  The scope of the law is extra-territorial.  Under the Act, a relevant person or company can be prosecuted for bribery if the crime is committed abroad.  The Act applies to UK citizens, residents, and companies established under UK law.  In addition, non-UK companies can be held liable for a failure to prevent bribery if they do business in the UK.

Section 9 of the Act requires the UK government to publish guidance on procedures that commercial organizations can put in place to prevent bribery on their behalf.  It creates the following offenses: active bribery, described as promising or giving a financial or other advantage; passive bribery, described as agreeing to receive or accepting a financial or other advantage; bribery of foreign public officials; and the failure of commercial organizations to prevent bribery by an associated person (corporate offense).  This corporate criminal offense places a burden of proof on companies to show they have adequate procedures in place to prevent bribery ( ).  To avoid corporate liability for bribery, companies must make sure that they have strong, up-to-date and effective anti-bribery policies and systems.  It is a corporate criminal offense to fail to prevent bribery by an associated person.  The briber must be “associated” with the commercial organization, a term which will apply to, amongst others, the organization’s agents, employees, and subsidiaries.  A foreign corporation which “carries on a business, or part of a business” in the UK may therefore be guilty of the UK offense even if, for example, the relevant acts were performed by the corporation’s agent outside the UK.  The Act does not extend to political parties and it is unclear whether it extends to family members of public officials.

The UK formally ratified the OECD Convention on Combating Bribery in 1998 and ratified the UN Convention Against Corruption in 2006.

The UK’s terrorism threat level was at the third highest rating (“substantial”) for most of 2022. On February 9, 2022, the UK lowered the threat level from “severe” to “substantial,” indicating that a terrorist attack remains “likely” rather than “highly likely.” The UK government had raised the threat level to “severe” on November 15, 2021, following two terrorist attacks in quick succession – the stabbing of David Amess MP on October 15, 2021, and the Liverpool Women’s Hospital bombing on November 14, 2021.  UK officials categorize Islamist terrorism as the greatest threat to national security, though they recognize the growing threat of racially and ethnically motivated terrorism (REMT), also referred to as “extreme right-wing” terrorism.  On January 26, 2023, the Home Office reported that in the year ending March 2022, the UK’s Prevent counterterrorism program received 6,406 referrals, a 30 percent increase compared to the year ending March 2021 (4,915). For the second consecutive year, there were more referrals related to “extreme right-wing” radicalization (1,309) than for “Islamist” radicalization (1,027).  MI5 Director General Ken McCallum said on November 16, 2022, that, since the start of 2017, police and security services had disrupted 37 late-stage attack plots.

On February 9, 2022, the UK Government passed legislation designed to strengthen the political stability of Northern Ireland’s devolved Government.  This legislation allows the Northern Ireland Executive cabinet and the Northern Ireland Assembly to continue to function for an extended period should either the First Minister or deputy First Minister resign from their positions in the Executive.  Northern Ireland’s terrorist threat level rating was raised from substantial to severe on March 28, 2023, following a recent increase in levels of activity, including the attempted murder of a senior Police Service of Northern Ireland (PSNI) officer.
Environmental advocacy groups in the UK have been involved with numerous protests against a variety of business activities, including: airport expansion, bypass roads, offshore structures, wind farms, civilian nuclear power plants, and petrochemical facilities.  These protests tend not to be violent but can be disruptive, with the aim of obtaining maximum media exposure.

Brexit has waned as a source of political instability.  Nonetheless, the June 2016 EU referendum campaign was characterized by significant polarization and widely varying perspectives across the UK. Differing views about the future UK-EU relationship continue to polarize political opinion across the UK.  In Scotland, which overwhelmingly voted for the UK to remain in the EU, the Scottish government led by the Scottish National Party (SNP) has cited Brexit as a key justification for pursuing a second referendum on Scottish independence.
Implementation of the Withdrawal Agreement has contributed to heightened political tension in Northern Ireland, in large part due to concerns over implementation of the Northern Ireland Protocol, which de facto creates a customs and regulatory border in the Irish Sea.  Under the terms of the Protocol, Northern Ireland remains a part of the UK customs territory but continues to apply EU standards and customs regulations as far as trade in goods is concerned. However, following two years of sometimes fraught negotiations, the UK and the EU formally adopted in March 2023 the Windsor Framework, a revised version of the Northern Ireland Protocol that reduces the administrative requirements for goods moving from Great Britain to Northern Ireland that are destined for consumption in the province. Goods entering Northern Ireland that are expected to move on to the Republic of Ireland (and therefore the EU’s single market) remain subject to the full set of EU customs checks and the EU’s Common Customs Tariff (CCT). Checks on goods entering Northern Ireland, both physical and documentary, are conducted at the region’s ports and airports, not at the land border with the Republic of Ireland, where goods flow freely between the two jurisdictions. Northern Ireland is included in the territorial scope of any free trade agreement the UK concludes with other countries, provided that such an agreement does not prejudice the application of the Windsor Framework.

The UK formally departed the EU on January 31, 2020, following the ratification of the Withdrawal Agreement, and completed its transition out of the bloc on December 31, 2020.

The UK’s labor force comprises more than 34 million workers.  Between November 2022 and January 2023, the employment rate was 75.7 percent, with over 32.8 million people in employment (of which 24.5 million working full-time). There were 1.25 million workers unemployed, or 3.7 percent.  The female employment rate was 72.3 percent.

The most serious issue facing British employers is a skills gap derived from a high-skill, services-based economy outpacing the educational system’s ability to deliver work-ready graduates.  The government has placed a strong emphasis on improving the British educational system in terms of greater emphasis on science, research and development, and entrepreneurial skills, but any positive reforms will necessarily lag in delivering benefits. The UK government has also put substantial resources into a number of apprenticeship programs.  The UK’s skills base stands around the OECD average and continues to improve.

As of 2020, approximately 23.7 percent of UK workers belonged to a union.  Public-sector workers represented a much higher share of union members at 52 percent, while the private sector was 13 percent.  Manufacturing, transport, and distribution trades are highly unionized.  Unionization of the workforce in the UK is prohibited only in the armed forces, public-sector security services, and police forces.  Union membership has risen slightly in recent years, despite a previous downward trend.

The UK government has faced a wave of strikes across the public sector since the summer of 2022. In January 2023 alone, a total of 220,000 working days were lost from labor disputes, and a further 822,000 were lost in December 2022.  As a result, the UK government tabled new legislation in January 2023 – the Strikes (Minimum Service Levels) Bill – that would enable employers to require enough employees to work during strikes so that the delivery of minimum service levels is ensured in some key sectors, such as health, transport, and education. At the time of writing, the bill has yet to complete its parliamentary passage and is widely opposed by trade unions as a step backward on workers’ right to strike.

The Trades Union Congress (TUC), the British nation-wide labor federation, encourages union-management cooperation.

On April 1, 2023, the UK raised the minimum wage to £10.42 ($12.89) an hour for workers ages 23 and over. The 2006 Employment Equality (Age) Regulations make it unlawful to discriminate against workers, employees, job seekers, and trainees because of age, whether young or old.  The regulations cover recruitment, terms and conditions, promotions, transfers, dismissals, and training.  They do not cover the provision of goods and services.  The regulations also removed the upper age limits on unfair dismissal and redundancy.  It sets a national default retirement age of 65, making compulsory retirement below that age unlawful unless objectively justified.  Employees have the right to request to work beyond retirement age and the employer has a duty to consider such requests.

The UK government brought forward new immigration rules on January 1, 2021.  The new rules have wide-ranging implications for foreign employees, students, and EU citizens.  The new rules are points-based, meaning immigrants need to attain a certain number of points in order to be awarded a visa.  The previous cap on visas has been abolished.  Applicants will need to be able to speak English and be paid the relevant salary threshold by their sponsor.  This will either be the general salary threshold of £25,600 ($33,600) or the going rate for their job, whichever is higher.  If applicants earn less – but no less than £20,480 ($26,880) – they may still be able to apply by “trading” points on specific characteristics against their salary.  For example, if they have a job offer in a shortage occupation or have a PhD relevant to the job.  More details are available here: 

The DFC does not prioritize investments in the UK.  Export-Import Bank of the United States (Ex-Im Bank) financing is available to support major investment projects in the UK.  A Memorandum of Understanding (MOU) signed by Ex-Im Bank and its UK equivalent, the Export Credits Guarantee Department (ECGD), enables bilateral U.S.-UK consortia intending to invest in third countries to seek investment funding support from the country of the larger partner.  This removes the need for each of the two parties to seek financing from their respective credit guarantee organizations.

Table 2: Key Macroeconomic Data, U.S. FDI in Host Country/Economy
Host Country Statistical source* USG or international statistical source USG or International Source of Data:
BEA; IMF; Eurostat; UNCTAD, Other
Economic Data Year Amount Year Amount
Host Country Gross Domestic Product (GDP) ($M USD) 2021 $3,122,759 2021 $3,131,378
Foreign Direct Investment Host Country Statistical source* USG or international statistical source USG or international Source of data:
BEA; IMF; Eurostat; UNCTAD, Other
U.S. FDI in partner country ($M USD, stock positions) 2021 $929,425 2021 $1,005,470 BEA data available at
Host country’s FDI in the United States ($M USD, stock positions) 2021 $634,708 2021 $512.431 BEA data available at
Total inbound stock of FDI as % host GDP 2021 88.2% 2021 81.9% Calculated using GDP and FDI data
from the ONS (host country source)
and the IMF (international source) respectively.

* Source for Host Country Data: Data for UK GDP and FDI stock positions is from the Office for National Statistics (ONS).  For the conversion from GBP into USD, we used the yearly average exchange rate for 2021 from the IRS website:

Table 3: Sources and Destination of FDI
Direct Investment from/in Counterpart Economy Data
From Top Five Sources/To Top Five Destinations (2021, US Dollars, Millions)
Inward Direct Investment Outward Direct Investment
Total Inward 2,612,886 100% Total Outward 2,159,391 100%
United States 827,063 32% United States 626,513 29%
Jersey 204.801 8% The Netherlands 204,327 9%
The Netherlands 170,148 7% Luxembourg 134,911 6%
Belgium 166,539 6% Spain 122,166 6%
Luxembourg 154,342 6% France 115,823 5%
“0” reflects amounts rounded to +/- USD 500,000.

U.S. Embassy London
Economic Section
33 Nine Elms Lan
London, SW11 7US
United Kingdom

On This Page

  2. 1. Openness To, and Restrictions Upon, Foreign Investment
    1. Policies Towards Foreign Direct Investment
    2. Limits on Foreign Control and Right to Private Ownership and Establishment
    3. Other Investment Policy Reviews
    4. Business Facilitation
    5. Special Section on the British Overseas Territories and Crown Dependencies   
    6. Outward Investment
  3. 2. Bilateral Investment and Taxation Treaties
  4. 3. Legal Regime
    1. Transparency of the Regulatory System
    2. International Regulatory Considerations
    3. Legal System and Judicial Independence
    4. Laws and Regulations on Foreign Direct Investment
    5. Competition and Antitrust Laws
    6. Expropriation and Compensation
    7. Dispute Settlement
      1. ICSID Convention and New York Convention
      2. Investor-State Dispute Settlement
    8. International Commercial Arbitration and Foreign Courts
      1. Bankruptcy Regulations
  5. 4. Industrial Policies
    1. Investment Incentives
    2. Foreign Trade Zones/Free Ports/Trade Facilitation
    3. Performance and Data Localization Requirements
  6. 5. Protection of Property Rights
    1. Real Property
    2. Intellectual Property Rights
  7. 6. Financial Sector
    1. Capital Markets and Portfolio Investment
    2. Money and Banking System
    3. Foreign Exchange and Remittances
      1. Foreign Exchange
      2. Remittance Policies
      3. Sovereign Wealth Funds
  8. 7. State-Owned Enterprises
    1. Privatization Program
  9. 8. Responsible Business Conduct
    1. Additional Resources
    2. Climate Issues
  10. 9. Corruption
  11. 10. Political and Security Environment
  12. 11. Labor Policies and Practices
  13. 12. U.S. International Development Finance Corporation (DFC), and Other Investment Insurance or Development Finance Programs
  14. 13. Foreign Direct Investment Statistics
  15. 14. Contact for More Information
2023 Investment Climate Statements: United Kingdom
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