Doing legal business in England and Wales
England and Wales is a world leader in the provision of legal services. Its legal profession has both a multiplying and enabling effect for business growth and stability, offering bespoke expertise to support other sectors of the economy.
According to analysis by KPMG, in 2018 legal services contributed £60bn to the economy and supported around 552,000 full-time employees in the UK.
There were approximately 9,500 law firms contributing to the UK’s legal services sector. This is in addition to services provided through in-house teams in corporates, third sector and government.
In 2017, legal services provided a positive net contribution of £4.29bn to UK balance of trade, the greatest contribution among professional services sectors in the UK.
The UK is the largest legal services market in Europe and second only to the US globally. It accounts for a third of Western European legal services fee revenue.
Over half of the revenue of the largest 100 firms in the UK is generated by international law firms based in London.
For foreign law firms, the English and Welsh legal system is one of the world’s most supportive for business; it is a very open jurisdiction that allows virtually unrestricted access.
English law often regulates the contractual relations between parties of various nationalities, even when the matter has no connection to the region, giving England and Wales a competitive global reach.
Another advantage is the robust nature of English law: it gives priority to upholding the deal; has few formalities; allows flexibility in transaction structures; and recognises choice of governing law and forum.
England and Wales provides law firms with easy access to other professional services and the availability of numerous high-quality providers in centres outside London including Manchester, Birmingham, Bristol, Cardiff, Leeds and Liverpool.
The UK is home to 200 foreign law firms from around 40 jurisdictions – employing over 10,000 people – many of which have developed capabilities in both English law and the law of other jurisdictions.
They practise English law, EU law, public and private international law, and the law of their state/jurisdiction of origin to provide a local and global service for their clients.
In 2021, more than 6,200 solicitors are practising around the world outside of the UK – many are foreign nationals who find that a qualification as a solicitor of England and Wales opens career opportunities.
For more on the benefits of England and Wales as a global centre for legal services, see our England and Wales: a world jurisdiction of choice report (available in a number of languages).
Introduction to the UK legal system
The UK legal system is split into three jurisdictions:
- England and Wales
- Northern Ireland
Each has its own court system and legal profession; and in the case of Scotland, a mixed legal system that is based on both Roman or civil law and common law.
There are separate court systems dealing with criminal and civil cases.
The hierarchy of English courts is as follows:
- the Supreme Court – the final court of appeal for all UK civil cases and for criminal cases from England, Wales and Northern Ireland. It hears appeals on arguable points of law of general public importance
- the Court of Appeal:
- Civil Division – hears appeals from the High Court
- Criminal Division – hears appeals from the Crown Court
- the High Court:
- Chancery Division – deals with estates, mortgages, trusts, partnership and bankruptcy
- Companies Court – deals with certain matters relating to companies
- Queen's Bench Division – deals with contract and tort issues, admiralty and commercial court matters
- Admiralty Court (also known as maritime courts) – exercises jurisdiction over all maritime contracts, torts, injuries and offences
- the Commercial Court – deals with civil law cases regarding international trade, banking, insurance, commodities and arbitration disputes. Sits in London but judges with commercial expertise also sit in Birmingham, Bristol, Leeds and Manchester
- the Technology and Construction Court – deals principally with technology and construction disputes
- Family Division – deals with family law matters
- Chancery Division – deals with estates, mortgages, trusts, partnership and bankruptcy
- the Administrative Court (formerly known as the Crown Office) – deals with a range of cases including judicial reviews and statutory appeals and applications
- the Crown Court – local criminal courts and appeals from magistrates' courts
- the county courts – local civil courts
- the magistrates' courts – deal with criminal and some family cases
The UK has ratified the European Convention on Human Rights (ECHR).
This has largely been incorporated into UK law by the Human Rights Act 1998, which requires judges in domestic courts to apply the provisions of the ECHR directly.
The European Court of Human Rights (ECtHR) is based in Strasbourg. It is charged with rendering binding judgment on the application of the ECHR by the member states of the Council of Europe.
A case will only be deemed admissible by the ECtHR if domestic remedies have been exhausted, with some exceptions, so that proceedings need to be brought in the first instance before the relevant UK court.
The ECtHR is not an EU institution and the UK remains a member after Brexit.
The Political Declaration accompanying the 2018 Withdrawal Agreement committed the UK to respecting the framework of the ECHR as a basis of future cooperation, and the UK-EU Trade and Cooperation Agreement notes the importance of parties giving effect to the rights and freedoms in that convention domestically.
English law, like the English language, is commonly used in international commerce and the law under which to resolve disputes arising from international contracts.
The Commercial Court, the Technology and Construction Court, the Insolvency and Companies List and the Chancery Division play an important role in maintaining London's position as the venue and jurisdiction of choice for the resolution of international commercial disputes.
These specialist courts have a high reputation for the calibre of their judges and the quality of legal advice and representation on offer.
They have practical experience in a wide range of areas, as well as awareness of the needs of business and knowledge of the differences in business practices around the world.
The popularity of London as an international centre for disputes resolution is such that around 80% of cases in the Commercial Court have at least one party from abroad and around 50% of cases have no connection to England and Wales except that the parties have chosen to resolve their disputes here.
International businesses are increasingly choosing to settle disputes by private methods of dispute resolution, such as arbitration or mediation.
These are often less adversarial than going to court and so can help to preserve business relationships.
Other advantages include the fact that proceedings are confidential, and these methods of dispute resolution are usually both quicker and cheaper.
London is one of the leading centres for ADR. Its arbitrators are obliged by law to manage the arbitration without unnecessary delay or expense.
There is a mechanism for the enforcement of arbitral awards in the UK, and the New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards offers a simplified procedure for enforcement in 149 other countries.
London is often chosen as the seat of arbitration for disputes between parties of different nationalities because it is perceived as being a neutral forum within which to resolve international disputes.
London is also renowned for its choice of specialist and experienced arbitrators.
Many will be members of, or trained by, the Chartered Institute of Arbitrators, an internationally recognised body that provides high-quality training for arbitrators.
Many arbitrators will be highly skilled members of the legal profession. Others will be technical experts in industry.
London has a range of highly respected organisations providing multi-industry international dispute resolution services including:
The legal profession in England and Wales
The UK legal profession is known as a split profession because it is divided into two categories:
- barristers (known as 'advocates' in Scotland)
While the distinction between solicitors and barristers has been eroding over time, the main difference is that solicitors provide continuous services to clients, while barristers act as sources of specialist legal advice on particular points of law or as advocates in courts, arbitrations and mediations.
Solicitors are granted rights of audience in all courts when they are admitted or registered.
However, solicitors cannot exercise those rights in the higher courts until they have complied with additional assessment requirements. These are different for rights of audience for criminal and civil advocacy.
In 2021, more than 150,000 solicitors and 17,000 barristers were practising in England and Wales.
The work of solicitors is highly varied. They provide the great bulk of first-line legal advice, undertaking detailed advisory work on behalf of clients of all shapes and sizes – whether governments and public bodies, companies or individuals.
The majority of solicitors work in private practice for solicitors' firms, which range in size from global firms with thousands of employees to sole practices.
Nearly 40% of solicitors work for the top 100 firms.
While solicitors are increasingly becoming more specialised and focusing on specific areas of law and legal pratice, around 10% to 15% are generalists working in smaller practices and as sole practitioners.
Solicitors have particular expertise in the following internationally focused sectors:
- financial services – English law firms' expertise has developed in parallel with the growth of the City of London as a leading international financial centre. Financial services are a global business and our global law firms have the capability to deliver legal advice in multiple jurisdictions and on multiple disciplines
- communications – telecommunications transactions are frequently governed by English law and disputes are often subject to resolution before the English courts or through arbitration in London
- project finance – much of the lending for significant projects (including in energy and infrastructure) is led by international lenders operating from the City of London. English law firms have good links with these lenders and regularly advise on risk analysis and the development of loan and security documentation for projects
- transport (aviation and shipping) – England and Wales has particular experience in aviation and shipping, drawing on its international status as an insurance and dispute resolution centre. Worldwide, English law governs 75% of all shipping contracts and 90% of all shipbuilding contracts
- competition law – English competition lawyers have a reputation for being practical and commercial in their approach. The training regime for English and Welsh solicitors, which allows individuals who have not studied law at undergraduate level at university to convert to the law, helps to bring in expertise from other sectors (for example, in economic analysis) that is frequently a critical element of competition advice
The independent body representing the solicitor profession is the Law Society of England and Wales.
Barristers in England and Wales form a corps of specialist consultants with particular expertise in advocacy, drafting and advisory work.
Many will also have knowledge of other systems of law and be able to advise on complex international legal questions in every area of the law.
There are around 17,000 barristers, most of whom work in private practice, though some work in-house for law firms and companies.
Barristers in private practice are generally used for providing specialist advice on complex questions of law or litigation and for advocacy in domestic and international courts or in alternative dispute resolution.
Most barristers are self-employed and – in more complex cases – work collectively with other barristers in sets of chambers.
The sole practice model exists in order to ensure access to barristers is not limited by conflicts of interest.
As individual practitioners, barristers in the same chambers can also work on different sides in the same case.
The independent body representing the barrister profession is the Bar Council of England and Wales.
A limited number of senior lawyers are made Queen's Counsel as a mark of professional excellence in advocacy.
Appointments are made from within the legal profession on the basis of merit rather than a particular level of experience.
The QC brand, conferred by the Crown, is recognised all over the world.
Following the Legal Services Act 2007, barristers and solicitors are subject to regulation by independent regulators that sit within their professional bodies under the oversight of the Legal Services Board.
The Law Society of England and Wales and the Bar Council of England and Wales are both designated frontline regulators with overall responsibility for the regulation of solicitors and barristers respectively.
The Solicitors Regulation Authority (SRA) is the regulator of solicitors and law firms in England and Wales. It sets standards and oversees the rules and disciplinary arrangements governing the practice of solicitors.
The Bar Standards Board (BSB) performs the same functions for barristers. However, qualification rules and discipline for the Bar are governed jointly by the Bar Council and the Council of the Four Inns of Court.
The Legal Ombudsman (LeO) handles complaints from the public regarding all those authorised to practise reserved areas of law in England and Wales including solicitors, barristers and registered European lawyers.
Practising law in England and Wales
It is not necessary to be a solicitor, barrister or other recognised professional in order to practise law in England and Wales.
Anyone is free to offer legal advice and services in England and Wales, in any law, including English law, with only the following restrictions:
- only those qualified and certificated as solicitors or barristers in England and Wales can call themselves by those titles. It is a criminal offence to act as a solicitor, or to pretend or imply that you are one
- certain limited areas of law are reserved to solicitors and barristers or other recognised professionals who are qualified to practise in England and Wales. See below for more information on reserved areas
The purpose of these limitations is to protect and promote the public interest and the interests of consumers, and improve access to justice.
Legal practitioners do not have to be British nationals.
In common with most jurisdictions, certain types of legal work in England and Wales are reserved to qualified solicitors, barristers or other recognised professionals.
These include the following:
The exercise of a right of audience
Foreign lawyers do not have the right to appear before and address a court, including the right to call and examine witnesses.
Foreign lawyers may, however, be temporarily admitted as barristers of England and Wales.
The Bar Council of England and Wales operates a regime of temporary call to the bar, whereby a visiting foreign lawyer can be temporarily admitted to perform advocacy in a case or series of cases.
Foreign lawyers can appear in court as expert witnesses.
Courts and judges in England and Wales can give rights of audience on an ad-hoc basis to individuals they consider important in a case.
In most tribunals (such as employment tribunals), there are no restrictions on rights of audience.
However, this does not apply to the Employment Appeals Tribunal or the Solicitors' Disciplinary Tribunal, which are equivalent to courts.
Nor does it apply to Immigration Adjudicators or the Immigration Appeals, where rights of audience are restricted.
There is no restriction on rights to represent parties at arbitrations conducted in England and Wales.
The conduct of litigation
Foreign lawyers do not have the right to conduct litigation. They may not:
- issue proceedings before any court in England and Wales
- commence, prosecute or defend in proceedings
- perform any ancillary functions in relation to these proceedings
Reserved instrument activities
Preparing any instrument of transfer or charge for the purposes of the Land Registration Act 2002 and making an application or lodging a document for registration under that act is a reserved activity.
Also reserved is preparation of any other instrument relating to real or personal estate for the purposes of the law of England and Wales or instrument relating to court proceedings in England and Wales except:
- a contract to grant a short lease
- a will or other testamentary instrument
- an agreement not intended to be executed as a deed, other than a contract that is included above
- a letter or power of attorney
- a transfer of stock containing no trust or limitation of the transfer
Preparation of probate papers for purposes of the law of England and Wales or in relation to any proceedings in England and Wales is reserved.
Other reserved activities
Notarial activities and the administration of oaths are both reserved.
- financial services – under the Financial Services Act 2012, the Financial Conduct Authority (FCA) is the regulator for investment business and claims management activities
- Solicitors, registered foreign lawyers and Swiss-registered European lawyers, and their partners, are permitted to carry out certain categories of investment business and claims management activities through firms authorised by the SRA without separate authorisation from the FCA. For more information, see the SRA's guidance on financial services activities
- immigration advice and immigration services – under the Immigration and Asylum Act 1999, the Office for the Immigration and Services Commissioner (OISC) is the regulator for immigration advice and services
- Members of certain professional bodies, including the Law Society of England and Wales, may provide immigration advice without registering with the OISC: registered foreign lawyers, Swiss-registered European lawyers registered in the UK practising through a body authorised by the SRA. For more information, see the UK government's guidance on OISC regulation and solicitors
For more information, see our guide to England and Wales as an open jurisdiction for foreign lawyers.
Subject to the above restrictions, any foreign lawyer can practise any type of law in the UK:
- as an unauthorised sole practitioner
- as an assistant or consultant with a firm of foreign lawyers
- in a partnership of foreign lawyers
- employed by English solicitors
- in partnership with English solicitors (but in some types of bodies, only if registered with the Solicitors Regulation Authority (SRA) as a registered foreign lawyer)
- in employment as an in-house lawyer (for example, in the legal department of a commercial company)
Registered European lawyers (RELs)
As of 1 January 2021, the EU Directives ceased to apply in the UK, including the Lawyers' Establishment Directive 98/5/EC and the Mutual Recognition of Professional Qualifications Directive 2005/36/EC.
The status of registered European lawyer is thus no longer available to lawyers from the EU, Iceland, Liechtenstein or Norway (although it is for Swiss lawyers).
All EU lawyers previously registered as European lawyers with the SRA have the option of registering as foreign lawyers.
The UK reached a separate agreement with Switzerland, which provides additional rights for Swiss nationals resident in the UK and UK nationals living in Switzerland.
This agreement broadly mirrors the EU Withdrawal Agreement but extends for four additional years.
Swiss lawyers continue to be eligible to apply for registered European lawyer status with the same practising rights as before Brexit.
This arrangement continues for four years after the end of the Brexit transition period.
This agreement may be renewed in the future.
Registered foreign lawyers (RFLs)
As noted, registration is not required for foreign lawyers if they are:
- only an employee of an SRA-authorised body and do not carry out any reserved legal activities or only do so under supervision where permitted
- in-house lawyers
- working in a foreign law firm
Foreign lawyers also do not need to register to be a manager or owner of a licensed body (also known as an alternative business structure (ABS)) or a business not authorised by a legal services regulator.
However, any foreign lawyer who wants to become a manager or owner of a law firm (which is not an ABS) in England and Wales must register with the SRA as an RFL.
To become an RFL, foreign lawyers must apply to the SRA under section 89 of Schedule 14 to the Courts and Legal Services Act 1990 and regulation 6 of the SRA Authorisation of Individals Regulations.
For an application to succeed, four basic requirements must be fulfilled:
- they must come within the definition of a foreign lawyer, which is a person who is not a solicitor or barrister but who is a member, and entitled to practise as such, of a legal profession regulated within a jurisdiction outside England and Wales
- the profession of which they are a member must be approved by the SRA as appropriately regulated (see the SRA's list of approved professions)
- their own professional rules must allow practice with solicitors in England and Wales
- they must have a satisfactory disciplinary record and satisfy the character and suitability assessment
For more information, see the SRA's guidance on registered foreign lawyers.
To apply to become an RFL for the first time, a foreign lawyer will need to provide the SRA with the following:
- the completed application form
- the fee for initial registration
- the appropriate contribution to the Solicitors' Compensation Fund
- a certificate of good standing from each bar, law society or chamber of which they are a member
- unless the SRA already has it, confirmation from the regulatory body or bodies for the profession(s) to which they belong that their rules allow practice with solicitors in England and Wales
Employment of foreign lawyers by solicitors
Subject to the rules of their home jurisdiction, foreign lawyers may practise in the employment of solicitors or authorised bodies.
However, they may be restricted in the work they can undertake in England and Wales (see above).
Employment of an English solicitor by a foreign lawyer
Solicitors can work with foreign lawyers and foreign law firms in a variety of ways.
For example, they can:
- be instructed by a foreign lawyer to provide legal advice
- be employed by a foreign law firm
- work for a foreign company in-house providing legal services
The SRA Standards and Regulations 2019 allow solicitors to deliver non-reserved legal services to the public on behalf of a business that is not authorised by a legal services regulator, such as a foreign lawyer or law firm.
Solicitors cannot provide other regulated services through such bodies unless they or the body are separately authorised to do so.
Individual solicitors working for businesses not authorised by a legal services regulator must comply with the SRA Code of Conduct for Solicitors. However, the organisation they work for will not be bound by the SRA Code of Conduct for Firms.
Depending on the regulatory status of the business, different requirements and restrictions may apply.
It is important that solicitors are fully aware of their regulatory obligations and should discuss these with prospective employers before they start employment.
For more details about practising models, read the SRA Standards and Regulations.
Sharing of facilities
A foreign lawyer is allowed to share facilities in a solicitors' office.
Similarly, the appearance of a foreign lawyer's name as a consultant or associated practice on a solicitor's professional stationery, name plate or brochure is permissible.
However, in both cases, the foreign lawyer must not be improperly held out as a partner, or held out as a solicitor, or as qualified to act as a solicitor.
The solicitor will have an obligation to ensure that any sharing of facilities will not give rise to a breach of clients' confidentiality and to ensure compliance with standards and regulations.
Other professional arrangements
Foreign lawyers, wherever based, are entitled to enter into professional arrangements with solicitors.
These arrangements can include the introduction of clients, referrals and sharing of professional fees.
The SRA Standards and Regulations and the home rules of foreign lawyers, if relevant, will govern these arrangements.
Foreign lawyers may also practise in associations with barristers and barristers' chambers.
Foreign lawyers who are not registered with the SRA are not directly subject to the SRA Standards and Regulations, which apply to solicitors and RFLs.
However, they are still subject to general consumer protection laws and any relevant regulatory requirements applicable to specific practice areas (for example, anti-money laundering, claims management, financial services, immigration services).
Foreign lawyers also remain subject to their home jurisdiction standards and regulations, including any that may be specific to overseas practice.
Foreign lawyers may want to check with their home jurisdiction bar, law society or regulator to ensure they remain in compliance with their own home regulatory requirements while practising in England and Wales.
Once registered with the SRA, RFLs must comply with the relevant standards and regulations that apply to their practice as an RFL and, if they are a manager of an authorised body, to the entity itself.
It is important to become familiar with the SRA's Standards and Regulations as many will apply to practise as an RFL but, in particular:
- the SRA Principles, which set out the ethical standards the SRA expects of regulated individuals, apply to RFLs at all times
- the SRA Code of Conduct for Solicitors, RELs and RFLs will apply to RFLs in full
For more information on European lawyers practising in the UK after Brexit, see the SRA's guidance.
Becoming a solicitor of England and Wales
From September 2021, lawyers from abroad and overseas students who wish to qualify in England and Wales will sit the Solicitors Qualifying Examination (SQE).
The SQE provides a path to the solicitor title through the same exam taken by domestic candidates.
The SQE has replaced the Qualified Lawyers Transfer Scheme (QLTS) and will enable lawyers from outside of England and Wales to requalify through the same exams taken by solicitors who qualify domestically.
Unlike the QLTS, the SQE is open to candidates from all jurisdictions, not just those recognised by the Solicitors Regulation Authority (SRA).
The introduction of a single, final, centralised qualification exam has also brought England and Wales in line with most other jurisdictions.
Foreign lawyers may be eligible for exemptions from some of the requirements under the SQE.
To requalify as solicitors, foreign lawyers need to:
- hold a degree in any subject or an equivalent qualification (such as an apprenticeship) or work experience
- complete two stages of assessment, SQE1 and SQE2, unless exempt (see below)
- satisfy the SRA's character and suitability requirements
An English language test may be required for those who are exempted from all or part of SQE2.
The test will take place post-admission when applying for your first practising certificate.
The SQE is divided into two parts:
- SQE1 consists of two exams in multiple-choice question format. SQE1 is available to take internationally at a range of test centres
- SQE2 consists of a series of practical assessments of skills through 12 written and four oral examinations. The written tests can be taken internationally at test centres. The SQE2 oral assessments must be taken over two days in England and Wales
Lawyers qualified overseas can apply for exemptions from the SQE on the basis of their prior qualifications or experience.
To be eligible for exemptions, the SRA must recognise a qualified lawyer's professional qualification as equal to part or all of the SQE1 and SQE2 assessments.
If exempt, the qualified lawyer will not be required to sit the corresponding components of the SQE assessment(s).
If a qualified lawyer is granted an exemption from SQE2, they may be required to demonstrate their English or Welsh language competence.
Exemptions may be applied for by individual foreign lawyers based on their qualification and personal work experience or by a foreign bar or law society for the qualification itself.
Foreign lawyers are also exempt from the requirement to have qualifying work experience (QWE).
Solicitors of Northern Ireland or the Republic of Ireland are fully exempt from the SQE.
They do not have to sit any examination in order to requalify in England and Wales and can directly apply for admission with the SRA after completely a pre-screening process.
The SRA does not require candidates to complete any preparatory courses before sitting the SQE, nor to have any specific university degree.
However, taking an SQE preparation course may give the best chance of passing the assessment.
A number of providers deliver SQE education, tutoring and training services or produce SQE-related study materials and resources.
While the SRA does not regulate, accredit or endorse training providers, it does have a list to help potential SQE candidates find training.
Candidates will be allowed three attempts at any of the assessments within a six-year period from their first assessment.
If they have not passed when the six-year period ends, they must retake all the assessments.
The total cost of the SQE assessments is £3,980.
This will break down as:
- SQE1 – £1,558
- SQE2 – £2,422
In addition to this, candidates may wish to undertake courses, or buy resources, to help them prepare for the SQE assessments.
A candidate who registers and successfully completes the SQE assessments could in theory be admitted as a solicitor in less than a year, if each test is passed at the first sitting and there are no suitability issues.
Candidates may apply for admission as soon as they have passed both the SQE assessments by completing the appropriate admissions application and paying the £100 fee.
Those who have lived in the UK will be required to complete a Disclosure and Barring Service (DBS) check. Similar vetting checks in previous countries of work may also be required.
The SRA also requires a certificate of good standing from your home bar or law society to be presented at the point of admission. This must be dated no more than three months prior to the date applying for admission.
All applicants for admission are subject to a suitability test.
If the SRA uncovers issues with your character and suitability, this may prevent you from being admitted.
Applicants can request an early check of their character and suitability before sitting the assessments.
You will also be asked at this stage whether you wish to take part in a voluntary admission ceremony in London. These ceremonies are held twice a month throughout the year at the Law Society’s Hall in London.
Once you are a solicitor of England and Wales you will be asked every year to renew your practising certificate online.
Alternatively, you can opt to stay on the roll of solicitors, which enables you to call yourself a non-practising solicitor.
Lawyers from abroad may also cross-qualify as barristers. More information on this can be found with the Bar Standards Board.
Opening offices of your law firm in the UK
There are no specific rules in the UK governing the form that a law firm that is not seeking SRA authorisation must take.
Foreign lawyers wishing to set up an office in the UK will only need to comply with any rules arising from their home jurisdiction's requirements and the general rules that apply to all companies setting up in the UK.
The UK has an open, transparent and business-friendly system to encourage the formation of new businesses.
No permission is required to establish a business presence in the UK, although there are regulations on the use of business names and certain business sectors that may require licences or authorisations (such as finance, defence and oil exploration).
Companies House is the key government organisation that coordinates the administration of businesses in the UK.
Detailed guidance on the requirements for forming a company in the UK is available on the Companies House website.
Independent professional advice on forming a company in the UK can also be obtained from solicitors, accountants and company formation agents.
The majority of foreign investors will establish a UK registered company when setting up in the UK.
There are four different types of UK registered company:
- private company limited by shares (Ltd) – the members' liability is limited to the amount unpaid on shares they hold
- private company limited by guarantee – the members' liability is limited to the amount they have agreed to contribute to the company's assets if it is wound up
- private unlimited company – there is no limit to the members' liability
- public company limited by shares (plc) – the company's shares are offered for sale to the general public through a stock exchange and the members' liability is limited to the amount unpaid on shares held by them
The vast majority of foreign businesses are established as a company limited by shares, either as a private limited company or as a public limited company.
Most foreign companies set up a private limited company that is a subsidiary of the overseas company.
It is a straightforward process to establish a company in the UK and there are no separate rules for foreign nationals.
To register a company, certain mandatory documents – such as the memorandum of association and articles of association – must be filed with Companies House.
The documentation can be prepared, and the company registered, in a day, provided that standard memorandum of association and articles of association are adopted.
It can take considerably longer if (a) tailor-made memorandum of association and articles of association are required.
Ready-made companies are available from company formation agents throughout the UK.
Choosing a company name
Regulations restrict the choice of a company name.
A company name cannot be chosen if it is the same as an existing registered company or uses certain words regarded as sensitive.
Before applying to set up a company, or doing anything to change its name, we recommend that a search of the company name index is undertaken.
Instead of registering as a UK company, foreign businesses can establish a presence in the UK through the following:
- a UK establishment
- a partnership
- a limited partnership
- a limited liability partnership
- a joint venture
UK establishment is the phrase used in the Overseas Companies Regulations 2009 to refer to a place of business or a branch of an overseas company in the UK.
Within one month of opening a UK establishment, an overseas company must provide Companies House with the following information:
- a completed registration of an overseas company opening a UK establishment application (form OS IN01)
- the standard registration fee (£20 in 2021)
If the company is registering its first UK establishment, it must also provide Companies House with the following additional documents:
- a certified copy of the company's constitutional documents (for example, charter, statute, memorandum and articles of association) with a certified translation in English if the original is in a language other than English
- a copy of the company's latest set of accounts (with a certified translation in English if the original is in a language other than English) if an overseas company is required to prepare and deliver accounts under parent law
Individuals, including overseas investors, can set up as a partnership in the UK.
The partners have joint and several liability for all debts.
This means that if a partner or a number of partners cannot pay, or be made to pay, their share of any debts, the other partners become liable (in addition to their own share of debt).
A limited partnership consists of:
- one or more persons called general partners who are liable for all debts and obligations of the firm
- one or more persons called limited partners who contribute a sum or sums of money as capital, or property valued at a statement amount. Limited partners are not liable for the debts and obligations of the firm beyond the amount contributed
A limited partnership must be registered under the Limited Partnership Act 1907.
To register, all partners must sign and submit Form LP5 to Companies House, including details of the business name, nature of the business, commencement date and the sum contributed by each limited partner.
An overseas limited partnership cannot usually register in the UK because the main place of business of a limited partnership has to be in the UK.
Limited liability partnerships (LLPs)
An LLP is an alternative corporate business structure providing the benefits of limited liability but allowing its members the flexibility of organising their internal structure and tax arrangements as a traditional partnership.
Any new or existing firm of two or more persons (in law, a person can be an individual or a company) can incorporate as an LLP.
An LLP is incorporated by registration at Companies House.
LLPs have similar disclosure requirements to a company, including the filing of accounts. They are also required to:
- file an annual return
- notify any changes to the LLP's membership
- notify any changes to their members' names and residential addresses
- notify any change to their registered office address
An overseas company can form a base in the UK by joining with a UK company.
Such joint ventures (JVs) are usually made with limited companies or established as a partnership.
However, it should be noted that if a foreign law firm wished to form some kind of joint venture with a firm of English solicitors, this would only be possible through a multi-national partnership (MNP).
The Legal Services Act 2007 enabled new forms of legal practice to develop, by allowing external ownership of legal businesses and multidisciplinary practices.
As a result, non-lawyer ownership is possible in England and Wales, and law practices can conduct their practice through alternative business structure (ABS) models such as:
- legal disciplinary practice (LDP)
- multi-disciplinary practice (MDP)
- incorporated legal practices (ILP)
The first ABSs were licensed in 2012 and, since then, the Solicitors Regulation Authority (SRA) has issued over 1,213 licences.
The Council for Licensed Conveyancers, Bar Standards Board and Institute of Chartered Accountants in England and Wales are also licensing authorities.
See our practice note on alternative business structures (registration required)
There are no specific rules applying to advertising and publicity for law firms in the UK.
However, the provisions in the SRA Code of Conduct for Solicitors, RELs and RFLs apply to firms as well. It requires that lawyers:
- ensure that any publicity in relation to the practice is accurate and not misleading, including that relating to charges and the circumstances in which interest is payable by or to clients
- do not make unsolicited approaches to members of the public, with the exception of current or former clients, in order to advertise legal services provided by you, or the firm
Employee rights in the UK are derived from both contractual provisions and legislation.
UK employment laws are stringent and legal advice should be taken before acting, as the penalties for non-compliance can be severe and damaging for the reputation of your business.
If intending to hire employees in the UK, it is worth seeking further information about compliance rules on:
- unfair dismissal
- employment contracts
- redundancy payments
- financial obligations
- employees secondment packages
- health and safety liability insurance
For more information, consult HM Revenue and Customs.
Short-term business visitors to the UK
Visitors can come to the UK for certain business activities, including to:
- attend meetings, conferences, seminars and interviews
- give a one-off or short series of talks and speeches, provided these are not organised as commercial events and will not make a profit for the organiser
- negotiate and sign deals and contracts
- attend trade fairs, for promotional work only, provided the visitor is not directly selling
- carry out site visits and inspections
- gather information for their employment overseas
- be briefed on the requirements of a UK-based customer, provided any work for the customer is done outside of the UK
Visitors working for a company with employees in the UK can provide training and share knowledge of internal projects.
Visitors can advise, consult and troubleshoot activities linked to a specific project, but this cannot involve directly working with or for clients (for longer term intra-corporate transfers, see below).
An overseas lawyer may advise a UK-based client on specific international litigation and/or on an international transaction.
Visitors can stay in the UK for up to six months.
Depending on the nationality of the visitor, it may not be necessary to apply for a UK standard visitor visa in advance.
Frequent visitors from countries requiring a visa can apply for long-term standard visitor visas that last two, five or 10 years, with a maximum of six months' stay for each visit.
Long-term work in the UK
From January 2021, the UK government introduced a new immigration system for hiring non-UK workers.
The UK's points-based system treats EU and non-EU citizens equally.
Irish citizens can continue to freely enter, live and work in the UK.
Some of the routes eligible to foreign nationals wishing to work in the UK from January 2021 include:
Skilled worker route
The skilled worker visa is available when there is a job offer from a UK company that holds a sponsorship licence.
There are minimum salary levels that must be met and there is a requirement to speak English at an intermediate level.
This visa can be extended so long as the applicant continues to meet eligibility requirements.
After five years, you can apply for indefinite leave to remain in the UK.
There are two types of intra-company visas:
- intra-company transfer – employees of multi-national companies can be transferred by their overseas employer to a UK branch of the organisation. The UK employer must have a certificate of sponsorship.
To be eligible, you must have worked for your employer overseas for more than 12 months, unless you will be paid £73,900 a year or more. There is a minimum salary of £41,500.
The maximum duration of the visa is five years in any six-year period if paid less than £73,900 a year or nine years in any 10-year period if paid more
- intra-company graduate trainee – this visa is for transfers to the UK as part of a graduate training programme for managerial or specialist roles. You must have worked for your employer overseas for at least three months.
There is a minimum salary of at least £23,000.
The visa lasts for 12 months and cannot be extended but can be reapplied for again after spending at least three months working for the employer outside of the UK up to a maximum stay of five years in any six-year period
Temporary worker – international agreement
This visa allows service providers to fulfil contracts with clients in the UK as either an employee of a contracted foreign company (contractual service supplier) or as an independent professional.
The contracting company must provide a certificate of sponsorship.
Citizens of countries that are signatories to the General Agreement on Trade in Services (GATS) can stay for six months in any 12-month period or for the duration of the contract, whichever is less.
Citizens of the EU or Switzerland, Norway, Iceland or Liechtenstein can remain for 12 months in any 24-month period or the duration of the contract, whichever is less.
Representative of an overseas branch
This visa is for a representative of an overseas business planning to set up either a first UK branch or a first wholly owned subsidiary.
The employee must hold a senior position in the business (but not own or control the majority of it) and have full authority to make decisions on its behalf.
Representatives of an overseas branch can remain for an initial period of three years, which can be extended for an additional two years.
After five years, you may be eligible to settle permanently in the UK.
You may be eligible for this visa if the business already has a UK branch or subsidiary but it is not yet set up and you can replace a previous sole representative.
- work for any other business
- remain in the UK if the sole representative arrangement is ended by your employer
- switch from this visa to any other visa category
You may be eligible for other types of visas that are not listed here. For more information, visit the UK government's visas and immigration website.
Download the report
Our international department
The Law Society's international department works on behalf of members to:
- reduce barriers facing solicitors of England and Wales working in overseas markets
- establish and maintain links with international counterparts
The international department provides practical support, training, information and advice to law firms and legal professionals working abroad or exploring international opportunities.
We also raise awareness of the legal sector's contribution to the global marketplace and promote the expertise of members across all regions, sectors and practice areas.
In addition, we submit intervention letters in support of lawyers at risk to state authorities in countries around the world.
The Law Society has consultative status with the United Nations (UN) and uses this status to:
- submit calls for action to UN special rapporteurs
- organise interventions before the UN Human Rights Council
- make submissions before UN treaty bodies and regional human rights mechanisms
We also organise events on human rights issues.
We're assisted in this work by our Human Rights Committee and International Action Team, a group of trained volunteers, many of whom are qualified solicitors and barristers.
For more information, contact us:
- email email@example.com
- call +44 (0)20 7242 1222