As the head of our law firm's U.S. efforts directed toward America, I am often asked: "Why do so many U.S. multinational companies choose the UK as the base for their European, Middle Eastern and African operations?" There is no single answer that fits all cases and all clients but here are some of the main reasons which we have encountered.
We Speak Your Language.
Despite the many jokes about the UK and the USA being separated by a common language, we actually do speak the same language when it comes to business. In that sense, we together have a great advantage: most of the rest of the world has to learn English as a second language, whereas for us both it is the mother tongue. In order to take into account the ongoing progress of English as a world language for business (and the many challenges that this creates for non-native English speakers, worldwide), we at Eversheds have recently published our handy pocket Guide to "Legal Drafting in English". Please contact me if you would like a complimentary copy.
Our Business Customs are Similar to Yours.
American businesses quickly find that, despite some differences here (we use pounds for our money and we write some words with an extra "u," such as "flavour") our commercial practices and customs are very similar to yours. The UK has a successful history of international business activities and, like you, we are just as comfortable doing business here as in San Francisco or Buenos Aires or Capetown or Beijing or Dubai and, like you, we have been international for a very long time. The UK is a major world center for finance, insurance, maritime matters, oil & gas technology, and deal making in general, just to mention a few subjects. We are home to many global companies, banks and accountancy firms, as well as to many specialised industries, as different as product manufacturing control, pharmaceutical research and development, environmental remediation, and the tracing and recovery of assets which may have been diverted by financial crimes or other wrongdoings.
Our Business Infrastructure is Highly Experienced, Stable and High-Tech.
The UK is highly IT in its approach to business (an information society, with computerised design and manufacturing, etc., and many business schools, technical universities and engineering schools, with many graduates who have also studied in the USA and are "at home" in both places). Many hi-tech approaches to business which are taken for granted, worldwide, were either invented in the UK or were improved here. We at Eversheds are also high-tech in our approach to the delivery of legal services: we know that no client likes it when it seems that the "legal wheel is being re-invented." Computers and electronic databases help us to commoditize legal information which should be treated in such a cost-efficient manner.
If you look at our website (www.eversheds.com) you will see examples of our many electronic approaches to such issues, including our "Directors' Law of Europe," an online database tool which gives European answers to 47 key corporate governance issues for almost 30 European countries, based upon the issues analyzed in detail in the ALI/ABA Restatement of "Principles of Corporate Governance." In the UK, we are used to giving U.S.-style answers to such multi-national questions, including compliance with Sarbanes-Oxley, PCAOB regulations, FCPA, and other important U.S. laws which have ramifications in the EMEA area.
We also have online news services that relate, for example, to employment law issues, to e-commerce, to food, to pharmaceuticals and to a variety of in-house counsel services.
Our Legal Institutions are Similar to Yours.
UK legal policies affecting business are more often promoted via regulation (usually in close consultation with the industries affected) and regulation is relatively "lite" (and often "decentralized") as compared to many other major European countries. The rule of law prevails in the UK and there is a well respected, smooth functioning court system, as well as highly experienced means for arbitration and mediation, etc. We also are one of the few countries which cooperate with the U.S. on a broad basis, when it comes to issues like extradition, as was shown in a recent much-publicized case involving some UK bankers, who had to face the legal music in Texas in the U.S. Federal District Court, regarding aspects of the Enron case. Dealing with the UK means that in some ways we are like an extension of your own borders. The UK is "clean" (bribery and corruption are very rare) and our legal, government and business institutions are often much closer to U.S. models than is the case elsewhere in Europe. This is hardly surprising, since we both share a common law background.
The UK is "Open for Business."
Compared to much of Europe, our laws allow relative freedom of contract regarding employer-employee relations. The UK is home to a varied work force (with local UK and non-UK specialists from all over the EU and the world), with ample labour resources at all levels, from highly skilled to semi-skilled and unskilled. Strikes and work stoppages are rare (and usually are settled very quickly when they do happen). UK does not have a litigation society mentality (disputes, if they arise, tend to be settled amicably and inexpensively).
The UK is a stable democracy of very long standing and we have a strong legal and societal commitment to "diversity" (a tolerant, pluralistic multi-ethnic society). We are one of the easiest countries in which to set up most types of businesses: the costs are relatively low and the "red tape" is kept to a minimum. There is a pro-business attitude and mentality which are widespread: people in the UK need no convincing. There is also excellent (and cost-effective) air transportation all over EMEA, as well as reliable road and rail logistics for products.
UK is also very diversified, geographically: it is not all about London.There are many major centers of business (London, Manchester, Birmingham, Leeds) and Eversheds is in all of them, with a major presence. Air transport is by no means centered on London: just last week I flew to Antigua, in the Caribbean, direct and non-stop from Manchester, in the North of England.
Other Reasons to Choose the UK for Business.
The UK is a full member of EU and thus has all the advantages of EU membership but it continues to tie its fiscal and monetary policy to its own currency and is seen as the most consistently pro-business of all large EU countries (even under "Labour" governments).
The UK is also the leader of the Commonwealth (thus we have special relations with Canada, Australia, India, and many African countries). Our competitive tax rates for business and the potential tax-free status for certain non-domiciled foreigners (individuals) also add to the overall attractiveness of the UK as an international business center and our very close geo-political ties to the USA can translate into specific advantages for certain businesses: such as the defence industry, investment banking, insurance/reinsurance. We also have a highly developed array of financial markets, including the London Stock Exchange, LIFFE (the London International Financial Futures Exchange), AIM (the London Stock Exchange's international market for smaller growing companies), not to mention NYSE-Euronext and specialized markets, such as the Baltic Exchange, in the worldwide ship chartering field, and Lloyds in the insurance business.
As the saying goes, the UK "must be doing something right":It is a traditional major destination for U.S. outward direct investment, corporate subsidiaries, branches, licensing, franchising and many other forms of business activity, including an array of compliance, regulatory, environmental and other issues relating to businesses with a worldwide scope of operations. Indeed, we are proud to be the only European-based law firm which is a Dupont Primary Law Firm.
Last but not least: the UK is a great place to "play" too: it has plenty to offer by way of culture, theatre, concerts, museums, restaurants, sports, education for ex-pat children and an all-around high quality of life. We are not all about work.
The Bottom Line.
In a nutshell: the UK is where "the action is," for all of Europe and as an ideal business base for the entire EMEA.