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At Forbes, we understand the world in which you do business and can help you to overcome the challenges which international trade can present. Our experts can assist your business in overcoming such challenges, enabling you to focus on exploiting and capitalising on the opportunities that are available to your business.

The object of our inter-disciplinary team is to help our clients to navigate their way through the increasingly complex network of regulation, legislation and standards that govern international trade. Whether you wish to trade overseas or you are considering establishing the UK offering for your products and/or services, our experts can provide legal and commercial guidance in order to make this process as streamlined as is possible. Through our membership with LawPact, Forbes has links with firms across the globe that can provide localised support where required.

Forbes is a full-service law firm, and we provide a broad range of commercial legal services to our clients on a local, national and international basis.

Continue reading for further information about our International Services.

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Additional Information

Commercial Services

 

The Commercial department at Forbes combines legal expertise with business and commercial acumen to produce suitable solutions for businesses wishing to exploit international opportunities. Our commercial lawyers can assist clients with a broad spectrum of legal issues and have particular specialisms within the Manufacturing & Engineering and Digital sectors.

Forbes' commercial lawyers will work with you to establish an understanding of your business's needs and advise on the most appropriate strategy. In particular, the Commercial department regularly assists our clients with the following:

  • Standard Terms and Conditions of Sale and/or Purchase;
  • Import/Export Terms and Conditions (incorporating, where appropriate, Incoterms® 2020);
  • International Agency and Distribution Agreements;
  • Complex Cross-Border Sales Contracts;
  • Manufacturing and White Label Agreements; and
  • Various other bespoke commercial contracts.

Our full range of commercial services can be found here.

Intellectual Property Services

 

When expanding into new territories and jurisdictions, one of the first questions that a business ought to consider is whether such expansion will infringe the intellectual property rights of a third party that may already be established in that region. Our intellectual property solicitors regularly assist clients in carrying out brand due diligence and clearance searches, both in the UK and internationally in order to provide the comfort that any expansion will not lead to potentially time-consuming and costly legal proceedings.

In addition to the above, our intellectual property solicitors provide the following key services to our domestic and international clients:

  • Filing of domestic (UK) trademark applications via the UK Intellectual Property Office ("UKIPO");
  • Filing of international trademark applications pursuant to the Madrid Protocol and via the World Intellectual Property Organization;
  • Inter partes proceedings before the UKIPO (such as trademark opposition and/or invalidity proceedings);
  • Intellectual Property Licence Agreements;
  • Assignments of Intellectual Property Rights;
  • Domestic and international Franchise Agreements; and
  • Intellectual Property disputes.

Our full range of Intellectual Property Services can be found here.

Business Immigration Services

 

For businesses that operate internationally, immigration and the international movement of people need to be carefully considered and addressed.

In light of Brexit and the end of the free movement of people between the UK and the EU, more people will now need to consider their options and visa status if they are coming to the UK for work. Similarly, British nationals travelling to the EU will need to assess whether they have the correct permissions in place to carry out certain activities.

Our membership with LawPact means that we have a link with other firms and can obtain advice from all over the globe.

To facilitate international trade, there are several UK visa options and the correct option will often depend on the activities to be carried out in the UK. For example, an individual travelling for a business meeting may simply need a business visit visa if they are an EU national. On the other hand, an individual may have agreed to come to the UK to set up a UK branch of an overseas entity. In these circumstances, a representative of an overseas business visa is likely to be the most practical option.

Our immigration team works with you to understand your business' needs and advises on the most appropriate visa category. We can assist your employees and business with the following:

  • Business visit visas
  • Frontier worker permits
  • Skilled Worker or Intra-Company Transfer visas under the sponsored worker route
  • Representative of an overseas business visas

We also assist individuals looking to establish their own business under the start-up and Innovator visa categories. We work with endorsing bodies and can put individuals in contact with them to begin the process.

The full range of our immigration services can be found here.

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FAQs

What is International Trade?
 
 

International trade is the exchange of goods and/or services between companies operating across international borders. The main benefit of international trade to a business is the opportunity to exploit new marketplaces. Traditionally, consumer goods have been the cornerstone of international trade. However, more recently there has been a growth in transactions relating to services, such as insurance products, which now make up a large percentage of UK exports to both the EU and beyond.

We are considering trading internationally, what do we need to consider?
 
 

One of the major barriers to trading internationally is cost; a factor which is of heightened relevance following the UK's exit from the EU. Businesses engaging in cross-board trade need to consider the obvious costs such as trade tariffs and associated declarations. However, there is a raft of potentially significant but less obvious costs, including customs handling fees and the increased cost of transportation. All of which will influence not only the price to be charged for a good or service but also the business' ability to effectively trade in a territory.

Businesses trading across the borders must accept - and work within - what can be a complex set of rules and regulations, including quality control and health and safety (such broadly falling under product liability laws). UK businesses have grown used to harmonisation with the EU; however, the effect of Brexit is that UK businesses will now also need to ensure that the goods and services which they supply to the EU (this is also the case further afield) comply with standards which may be more stringent than (or otherwise different to) those expected domestically in the UK. Businesses supplying goods, for example, may need to adapt their products to adhere to the legal expectations of foreign markets and even consider producing versions of the products to satisfy jurisdictional requirements.

When establishing terms for trade across borders, businesses should also consider how they might ensure certainty and clarity with regard to the delivery of goods. By appropriately incorporating the International Chamber of Commerce's recently updated Incoterms® 2020, a business will be assured that they are incorporating commonly accepted definitions and rules related to the delivery of goods between trading partners worldwide. However, as a point of caution, differing Incoterms® impose differing obligations on the parties in relation to risk, insurance and duties - expert advice ought to be obtained prior to incorporating Incoterms® into your international trade contracts.

Why is a contract so important with regard to international trade?
 
 

Contracts are used in all aspects of our lives. They define the legal relationship between parties and even in the most basic form, a contract will provide (if drafted correctly) the ultimate understanding of the respective obligations and the price that will be paid for the goods and/or services. By defining the expectations of the parties, the likelihood that the parties' relationship and the transaction in question will be successful is increased significantly.

While many contracts are signed and never considered again, a documented contract becomes of the utmost importance when the relationship between the parties becomes fractured. A well-drafted contract should, therefore, not only include the basic variables but also provision for what procedures are to be engaged should a party fail to deliver on a contractual obligation (an example of such being detailed delivery, inspection and acceptance clauses in the event of potentially faulty goods).

Trading internationally can present the businesses with a degree of risk with regards to receiving payment for the goods and/or services provided. Therefore, when trading in higher-risk markets, or when contracting with new customers, it is important for the business to specify acceptable and secure payment terms which may, for example, include payment in advance. A business may also consider requesting additional security from the customer which could take the form of either a personal guarantee from a director of the firm or if the customer is a subsidiary of a larger company, a parent company guarantee.

When contracting across borders it is imperative that the contract includes a provision relating to the jurisdiction applied to the contract. As English and Welsh law is viewed as rational and predictable it provides for an attractive choice of law and jurisdiction for international trade deals. It is also important to ensure that any pre-litigation procedures which needed to be adhered to and what rights are retained in the event that the contract is terminated. Ensuring these terms are clearly documents will assist parties with remedying a dispute or enforcing their rights.

In addition to the above, parties are becoming increasingly expected to engage in pre-action alternative dispute resolution (ADR) measures, prior to any proceedings being issued. With international trade and undoubted jurisdiction/enforcement difficulties in mind in due course, a well-drafted contract will also include effective ADR clauses, which a party may engage as an alternative to (or in conjunction with) live proceedings.

Should we consider forming a subsidiary company in a foreign territory?
 
 

There is, unfortunately, no precise answer to this question. Ultimately, it will depend on how much of your business comes from within that territory, where most of your clients are based and inevitably the associated cost and tax implications in relation to which you should take specialist tax advice. Operating via a subsidiary is a popular form of incorporation when trading in the EU; however, choosing between opening a branch or a subsidiary will have legal and tax implications which must be considered.

Do we need a licence to export goods?
 
 

In addition to tax and export tariffs, and the requirement for specific (and often, extensive) documentation, exported goods may also be subject to restrictions. Businesses wishing to export goods (such as drugs, medicine and animal products) are advised to explore the licencing requirements (granted by the UK Government) required to export such products.

Exporters should also consider whether any local restrictions apply to the import of such goods and whether the goods themselves meet the legal requirements for sale in the territory.

Away from governmental licences, the business may also wish to consider granting an international licence to a third party, in order for that third party to exploit the business' intellectual property rights in a foreign territory. An example of where such a licence may be suitable in the agent/distributor scenario. Entering into such agreements would enable to gain access for its 'brand' to a new markets place with minimal risk and cost, as the cost production of the goods, for example, would be subsumed by the other party to the agreement. However, the resultant financial reward will be considerably lower than if the business were to trade directly in the marketplace.

We would like to sell goods internationally, how can we manage the risk related to the delivery of goods?
 
 

While parties are free to negotiate their own terms, INCOTERMS (International Commercial Terms) are an internationally recognised set of trade terms developed by the International Chamber of Commerce (ICC) which manage the delivery of goods particularly in relation to international trade. The terms define the responsibilities and liabilities between a buyer and a seller, including where risk, cost of delivery, responsibility for certain export/import requirements and insurance transfer.

The INCOTERMS are designed to provide clarity on these points for each contracting party. They are not in themselves a contract for sale, and therefore it is advised to effectively incorporate them into the delivery provisions within a contract to give them maximum effect.

Why should EX Works not be used for export?
 
 

When using EXW (EX Works) all of the costs and risk associated with shipping the goods is placed on the buyer. For the buyer, it can be a good term as it provides for a clear picture of all of their shipping costs, which can help calculate more accurate costs. However, this transfer of risk and allocation of cost creates an issue when using EXW when exporting goods.

With EXW, there is no obligation on the seller to organise export clearance for the goods. The seller participation in export clearance is limited to aiding in obtaining the documents required by the buyer. As a seller, who is exporting from the UK, would not be charging the buyer VAT. If proof of export is required for HMRC audit purposes which can be an arduous process.

Therefore, for international transactions, FCA (Free Carrier) may be more appropriate. The most important difference here between EXW and FCA terms is that the seller would be responsible for ensuring that the goods are loaded onto the buyer's means of transport (or unloaded in the case that it is delivering to the Customer's premises). Risk will transfer once this has taken place.

What are Rules of Origin?
 
 

Following the UK's exit from the EU, Rules of Origin have become of particular importance as they are used to determine the origin of a product for purposes of international trade. For example, where a preferential trade agreement is in place, exporters are required to prove that the goods being shipped meet the Rules of Origin in order to benefit from reduced or zero import duties.

We provide services rather than goods, what do we need to consider?
 
 

A service export is, very simply, any service provided by a business that is resident in one country to people or companies from another. According to UK government statistics, service exports account for approximately 45% of exports from the UK (with the majority of those services concerning the financial services industry).

While there are no physical goods to be delivered, businesses must consider how they might provide the services in a specific territory. For example, where the service is to be provided by a physical person, the business should consider whether visas are required as well as the potential tax implications of that person working across borders. As with goods, the business should also consider whether there are any local restrictions relating to the services and whether any local legal requirements need to be considered.

The supply of services internationally often involves the transfer of data between jurisdictions. Businesses should therefore consider the adequacy of any contractual terms relating to the transfer of data. Following the end of the 'transition period' (which marked the end of the UK membership of the EU), the UK has adopted its own set of Standard Contractual Clauses. Businesses that transfer data between jurisdictions are advised to adopt these terms (without amendment) to ensure compliance with relevant data protection legislation.

Should we appoint a Commercial Agent or a Distributor?
 
 

Businesses may wish to appoint a commercial agent or distributor to:

  • Take advantage of the commercial agent's or distributor's established local connections.
  • Save the cost of having to establish its own sales operation,
  • To test a new market in a cost-efficient manner.
  • It is, however, important to differentiate between the two as the subsequent contractual relationship is distinctly different.

A commercial agent is an intermediary who a company appoints to negotiate and, in certain circumstances, conclude contracts with customers on the company's behalf. The resulting contract is between the company and the customer, with the commercial agent receiving commission which is usually a percentage of the contract value. A company may choose to appoint an agent where it wishes to:

  • Retain control of the terms of sale of its goods or services.
  • Restrict, subject to competition laws, the agent's freedom to choose the customers that they deal with.
  • Retain contractual relationships with its customers and financial risk in relation to stock.

By contrast, a distributor is essentially independent of the company. The company will enter a contract to sell the goods or services to the distributor, and the distributor then sells the goods or services (at a premium to cover the distributor's own costs and profit) to their customer. Where a distributor is engaged it is the distributor who has the contract with the customer. A company may choose to appoint a distributor where it wishes to:

  • Not incur the cost of expensive retail premises and exporting the goods.
  • Limit the risk involved with expansion into a new market.
  • Utilise the distributors established contacts and sales funnels.

It is worth noting that a commercial agent has various statutory rights that a distributor does not. These are covered below.

What rights does a Commercial Agent have?
 
 

Unlike a distributor, commercial agents have various statutory rights. The Commercial Agents (Council Directive) Regulations 1993 (the Regulations) incorporated the EU's Commercial Agents Directive (86/653/EEC) into UK law with common law has to supplant this provision.

The Regulations are important to both parties to an Agency Agreement as it confirms respective rights and obligations. Regulations 3 and 4 of the Regulations, for example, spell out the duties of the agent and principal and that these may not be derogated from.

Regulation 15 of the Regulations, for example, outlines the notice period which the Principle must provide a commercial agent should it wish to terminate the agreement.

Additionally, one of the key rights held by a commercial agent is, in accordance with Regulation 17 of the Regulations, the entitlement to payment upon termination of the agreement. Conversely, Regulation 18 provides for grounds for excluding payment on termination and include where the agreement has been terminated due to the default of the agent.

The Principal must also provide the commercial agent with a statement of commission due to the agent and, in the absence of any agreement in relation to a specific level of remuneration must pay the agent "reasonable remuneration".

Summarily, the significant rights of commercial agents highlight the importance of putting in place a clear and robust agreement.

I am an entrepreneur looking to relocate to the UK and start up a new business, do I need a visa?
 
 

A: Yes - there are a number of different routes available:

Start-up visa:

The Start-up visa route is designed for individuals starting a business for the first time in the UK. It gives flexibility, allowing a successful applicant the option to take employment alongside developing their business. An applicant must be endorsed by an endorsing body that is either:

  • a UK higher education institution
  • a business organisation with a history of supporting UK entrepreneurs

In order to obtain an endorsement you must be able to show that your business idea is:

  • a new idea
  • innovative - this must be an original business idea that is different from anything else on the market
  • viable - it has potential for growth

Leave is granted for a period of two years and cannot be extended beyond this. If the business is going well, you may be able to switch into the Innovator category.

Innovator visa:

The Innovator route is aimed at entrepreneurs that can demonstrate a credible business idea and their credibility in business.

You must receive an endorsement from an approved body prior to applying for an Innovator visa. The credibility of the business idea will be assessed during the initial application process by both the Home Office and your endorsing body. The business idea will be assessed by strict criteria including innovation, viability, and scalability.

In addition, you must have at least £50,000 in investment funds from a legitimate source and be able to demonstrate that you can support yourself by having had at least £1,270 in your bank account for 28 consecutive days before the application.

If you are switching from a Start-up visa, the investment requirement is waived.

Investor visa:

While the Investor visa category is not designed for the purpose of setting up a business in the UK, people who come to the UK in this category do have a full right to work including setting up and running a business in the UK.

If none of the business-based categories is appropriate and you have access to at least £2 million, you could consider coming to the UK in the Investor category. Providing you maintain your investment funds as required in qualifying investments for the appropriate duration, you can also run a business in the UK.

Please contact us if you have further questions regarding the different visa routes available. We also work alongside endorsing bodies to support you with the process.

We are having difficulty in recruiting into a Skilled role and are looking to recruit from outside of the UK, what do we need to do?
 
 

A: Now that the free movement of people between the UK and EU has come to an end there is no distinction between EU and third-country nationals. Therefore, if you wish to hire any non-UK and non-Irish nationals under the Skilled Worker category you will need a sponsor licence issued by the Home Office. If you do not already have a licence, you will firstly need to apply and be approved for a licence before you can recruit an overseas national.

Once the licence is in place, you will need to request a 'defined certificate of sponsorship' from the Home Office for the genuine vacancy that you want to fill. To be eligible to apply, anyone you recruit from outside the UK under the Skilled Worker route must demonstrate that:

  • they have a job offer from a Home Office licensed sponsor (i.e. you);
  • they speak English at the required level;
  • the job offer is at the required skill level of RQF3 or above (equivalent to A level); and
  • that they will be paid at least £25,600 or the "going rate" for the job offer, whichever is higher.

Please get in touch if you need further assistance and advice in relation to the recruitment of foreign nationals.

How do you apply for a sponsor licence?
 
 

A: The application is via an online form that requires you to pay a fee when you submit the form. The fee depends on the type of licence you're applying for and what type of organisation you are. Following the payment, you will need to send various pieces of supporting documents and information to the Home Office for their consideration.

Most applications (8 out of 10) are dealt with in less than 8 weeks and there may be the option to expedite the processing time to 10 working days. UKVI may also visit your business in advance of granting a licence

At the application stage, the business will need to assign the following roles:

  • Authorising officer ('AO'): The person nominated into this role will be responsible for immigration compliance and must be the most senior person within the business who is responsible for recruiting workers
  • Key contact: This person will act as the main contact with the Home Office - this can be a legal representative (we offer this as part of our service)
  • Level 1 user: This person will have access to the online Sponsor Management System ('SMS') in the first instance. They can then add additional users.

The three roles could be held by one person only or can be divided between personnel. However, each person must be permanently based in the UK, have no criminal convictions and be a paid member of staff or officeholder.

Once the licence is granted it is in place for 4 years and can be renewed indefinitely for an additional 4 years each time.

Forbes offers a fixed cost support package for the sponsor licence application process. Please contact us if you would like further information.

Our business regularly trades with the EU and we have a number of employees who travel there frequently, what are the current rules?
 
 

A: This will depend on the individual circumstances. Free movement of people between the UK and EU has now ended and the employee will be subject to the rules of the individual member state. The business must therefore consider carefully if a visa/work permit is required in the country they visit. If an employee is travelling for business and does not have the appropriate permission in the country they travel to, they may be refused entry.

Whether or not a work visa/permit will be required will depend on the country being visited and the type of business activity being carried out. Each EU country has its own permitted business activities where a visa/work permit is not required.

Intracompany transfers - there are different rules for employees who are temporarily transferred to a business within the same group of companies in the EU. Provided that there are linked businesses in the UK and the EU destination country, the employee meets the intra-company transfer requirements, and an intra-company transfer permit is successfully applied for, the employee will be able to gain entry and stay temporarily. How long they are permitted to stay is dependent on the position they hold.

Alternatively, where a role involves the sale of goods you may wish to consider engagement with a commercial agent. A commercial agent is, as the title suggests, someone who facilitating sales in specified territories on behalf of a principal. The commercial agent will likely reside in the territory (or possess the necessary visa/work permits required for them to work there) thus eliminating some of the issues outlined above.

For advice on your individual circumstances, please get in touch.

We are an EU company that has employees who travel to the UK for business, what type of visa will they require?
 
 

A: As with a UK employee travelling to the EU for business, there are some business activities that are generally permitted for short-term, visa-free, visits to the UK.

Frontier worker permit - this is for those Europeans based outside the UK but who travel to the UK to work and have not already obtained status under the EU Settlement Scheme. However, they must have begun working in the UK before 31 December 2020.

From 1 January 2021 to 30 June 2021, frontier workers will be able to enter the UK and carry on their activities without a permit or visa. From 1 July 2021 onwards, they will be required to present a frontier worker permit, or other visa permission under UK law, to evidence their right to work in the UK.

For those who do not qualify to apply for a frontier worker permit, or the activities fall outside of those permitted as a business visitor, employees will need to apply for a visa under the Skilled Worker route and satisfy the requirements listed above in the previous question.

For advice on your individual circumstances, please get in touch.

We are an overseas entity that is looking to set up a new branch in the UK, can we send over an employee to achieve this?
 
 

A: Yes - there is a Representative of an Overseas Business visa category that can facilitate this. Your business will need to identify a current senior employee to set up the new UK branch.

There are requirements for both the overseas entity and employee to meet. For example, the business cannot intend to make the UK branch its headquarters and the UK activities must be the same as the overseas entity, and the employee must have decision-making powers and cannot be a majority shareholder.

Once the employee receives their visa, they can come to the UK and set up the branch. Should you then wish to recruit overseas nationals who have a specific skillset to expand the business, the representative employee can firstly apply for a sponsor licence for the UK branch before beginning the visa process for any new recruits.

Once a UK branch has been established consideration of the intra-group contractual relationship is required. For example, service level agreements, bespoke terms and conditions or licences which govern the use of any intellectual property owned by the entities may be required.

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Our dedicated International team

John Pickervance

John Pickervance

Partner and Head of Commercial

Commercial

PinCentral Lancashire

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Amy Stokes

Amy Stokes

Partner & Business Immigration Specialist

Employment & HR

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Daniel Fletcher

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Commercial

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