The turbulent economic climate in the UK and across the globe presents a variety of challenges and opportunities for businesses large and small. The conflict in Ukraine, supply chain issues, increased energy prices, and inflation are all having an impact. 3CS explains how this background is affecting demand for its various legal services.
How is corporate spend on legal services being impacted?
According to research published earlier this year into the State of the UK Legal Market from Thomson Reuters, corporate clients expect to increase their year-on-year expenditure in 2022 on UK legal services as priorities shift, with the largest growth area expected to be in regulatory matters. While COVID-related issues remain an important issue, other key legal needs include dealing with complex and ever-changing regulations, both in the UK and elsewhere.
Which services are in demand within the Corporate and Commercial sectors?
Since the recent introduction of the Register of Overseas Entities (ROE), we have received numerous requests from our overseas clients to help them navigate and comply with the new registration requirements. The ROE requires all overseas entities that own UK land or property to declare their beneficial owners or managing officers. The deadline for registration is 31st January 2023 and failure to comply attracts very severe penalties. We have also seen an increase in requests for M&A legal support, as well as support for data protection and modern slavery compliance reviews and training.
Keith McAlister, Director / Solicitor Corporate and Commercial at 3CS commented, “The introduction of new legislation such as the Economic Crime (Transparency and Enforcement) Act 2022, and the evolving regulations in relation to data protection and modern slavery mean that companies must keep their compliance procedures and registration requirements under regular review.”
How is the current climate influencing demand for Employment services?
A very common response to changing economic times is for firms to restructure their workforce so that they are optimally adapted to the changed landscape and can more efficiently deliver goods or services. ‘Restructuring’ is a blanket term describing anything from changing individual terms and conditions or duties to deleting posts and creating new ones to redundancies or even more radical changes involving buying or selling businesses or inter-group transfers. Not surprisingly, this carries a very wide range of legal implications depending on what is proposed - contract law, unfair dismissal, redundancy consultation and even TUPE can be involved, sometimes all at once.
Beth Baird, Director / Solicitor Employment at 3CS commented, “When you know you have to restructure, in whatever form that may take, it is plainly an advantage to have a clear goal in mind and an idea of how long it will realistically take to implement. Having your legal advisers involved at the outset can help with this vital planning process so that any legal obstacles can be anticipated and overcome and that the process is not held up by mandated statutory or contractual timetables.”
In the property sector, which legal services are in demand?
There is often a time lag between the impact on the property sector and external economic factors. However, in the current situation, the impact, particularly on the residential sector was immediate with the mortgage market scrambling to re-price its products due to forward rising interest rates. This of course also impacts the availability of funding in respect of commercial products and particularly shorter-term bridging finance on development projects.
We are seeing a slight slowdown in residential acquisitions but interestingly growing interest in short-term refinancing for developers around Central London-based developments coupled with opportunity-driven development acquisitions by developers using call options and joint venture investment schemes.
On the occupational side, there is continuing commercial property uptake, particularly from overseas investors, retailers, and government bodies.
Fionnuala Nolan Director / Solicitor Property at 3CS commented, “Economic turbulence may also provide an opportunity for investors. The effect of exchange rate margins set against domestic rising interest rates may also provide an interesting opportunity for overseas property investors who have the finance, property, and investment skill to extract value from the current market.”
Which immigration services are in demand?
We are currently seeing an increased demand in companies applying for new sponsor licences so that they can have the ability to hire expatriate workers from both within the UK and overseas, under the points-based system. The increase in applications is partly because of the UK’s withdrawal from the EU and the end of the transitional period that was agreed upon and also owing to the expansion of the type of jobs that can be sponsored under the current visa schemes, including lowering of the minimum skills level required for certain visas from Level 6 (degree level jobs) to Level 3 (A-level). The above has also led to some companies with existing sponsor licences to apply for additional licence categories to take advantage of the newly published regulations.
In addition, following the UK government’s decision to withdraw the Overseas Business Representative visa in April 2022, we are also seeing an uptake in companies using the Global Business Mobility - Expansion Worker route. This visa route is mainly aimed at companies or organisations that do not yet have a business presence in the UK and wish to set up a subsidiary or branch to expand their offering into the UK market.
Thomas Miles Head of Legal / Immigration at 3CS commented, “Our team has extensive experience in dealing with sponsor licence applications and in advising on the pertinent requirements that the Home Office look out for, to ensure a successful outcome and a smooth immigration journey/ experience. We also ensure we are up to date with any new regulations and rule changes to safeguard our clients’ interests and ensure they receive the most up-to-date and relevant information for their applications.”
How 3CS can help
For legal help and advice on any business matter, please get in touch with your usual 3CS contact.