2024 Regional Roundtable Update: England
2024 United Kingdom Regional Update
Firm Name: Gowling WLG
Author: Emily Airton, Tom Cox,
1. How is the political environment impacting business in or with your country?
The current geopolitical climate / macro-economic conditions continue to impact business in the UK. On the capital markets side, there has been a slowdown in initial public offerings / secondary fundraisings and an uptick in public M&A activity, with English companies priced attractively for overseas buyers. We're also seeing a lot of public M&A in the listed funds space, with smaller players consolidating into larger combined vehicles, providing greater liquidity opportunities for investors.
Private M&A, P&E, and VC, whilst not at their peak,remain busy, with attractive deals to be done for those who have the cash. VC investors, in particular, are telling us that, with valuations having come down (particularly in the tech space), there is an opportunity to invest on more attractive terms in a less tightly competitive market than in recent years.
In other areas, we have seen the current economic climate bring with it new opportunities – for example, pension risk transfer transactions.
The UK general election is due to take place by the latest of January 2025, and based on current polling it is likely we will see a new Labour government gaining power. One policy commitment that high net worth clients may be interested in is Labour's pledge to replace the "non-dom" taxpayer status in the UK, replacing the rule with a shorter-term scheme for temporary residents.
2. Which countries have you previously collaborated with and do you see potential for future collaboration with on cross-border matters within the region?
Across our firm, we have previously collaborated with most countries in the region. Areas where we have recently seen the most frequent opportunities for cross-border collaboration include M&A transactions with a cross-border element, advice in connection with overseas expansion plans (especially as regards regulatory considerations), financial services regulatory advice for listed funds clients seeking to market their shares into Europe, and local advice on real estate deals for clients with overseas real estate assets.
3. What legislation has recently changed or is changing that a potential international client should be aware of?
Financial services and markets regulation in the UK is undergoing significant reform following the passing into law of the Financial Services and Markets Act 2003. The reforms are geared at maintaining the UK's status as a financial services hub and the attractiveness of the London markets as a listing venue as well as making sure the regulatory regime remains agile in the context of innovations in financial products and services.
Among other things, FSMA 23 paves the way for an overhaul of the UK prospectus regime. The new UK prospectus regime, which will not be fully operative until 2025 at the earliest, is expected to operate broadly comparatively with the UK Prospectus Regulation but crucially is anticipated to make the process for secondary fundraisings less administratively burdensome, time-consuming, and costly (including by increasing the threshold which will trigger the requirement to publish a prospectus).
The UK listing regime is also in the process of a substantive review, with new UK Listing Rules expected to be published in the second half of this year. If brought in, they will create a simplified listing regime with a single listing category for equity shares of commercial companies with simplified eligibility requirements and ongoing requirements. They will also create a more flexible route to a secondary listing in the UK and reduce the scope of transactions requiring shareholder approval and the preparation of an FCA-approved shareholder circular.
View more WLG Doing Business In chapters.