United Kingdom

Investing

FDI in figures

The UK is the second largest recipient of foreign direct investment (FDI) globally in 2006 according to the United Nations Conference on Trade and Development (UNCTAD). According to data published by UNCTAD, the stock of outward UK FDI totaled $1,487 (BPS 725) billion in 2006 (or 63 percent of GDP), up from $1,228 billion in 2005.

Foreign Direct Investment	2004	2005	2006
FDI of inward flow (millions USD)	55,963	193,693	139,543
FDI inward stock (millions USD)	n.c.	n.c.	1,135,265.0
Performance Index*, world ranking	94	47	34
Potential Index**, world ranking	3	3	n.c.
Number of Greenfield investments	520	633	669
FDI inwards (in % of GFCF)	16.1	52.9	33.9
FDI stock (in % of GDP)	n.c.	n.c.	47.8

Source: UNCTAD, World Investment Report

Note: * The UNCTAD Inward FDI Performance index is based on a ratio of the country's share in global FDI inflows and its share in global GDP. ** The UNCTAD Inward FDI Potential index is based on 12 economic and structural variables such as GDP, foreign trade, FDI, infrastructures, energy use, R&D, education, country risk.

Why you should choose the United Kingdom

Strong points: The World Bank found that it takes 13 days to set up a business in UK , compared to the European average of 32 days. It ranks the UK first in Europe and sixth in the world to operate a business. Favorable environment for foreign investors due to low tax rate. London is the world's leading financial services centre on a number of key performance indicators and was voted top European city for business for the 17th year running in 2006 by the European Cities Monitor.
Weak points: Bad quality infrastructure. Foreign competition in industrial sectors.
Government measures to motivate or restrict FDI: Once established in the UK, foreignowned companies are treated no differently from UK firms. Within the EU, the British Government is a strong defender of the rights of any British registered company, irrespective of its nationality of ownership.
Bilateral investment conventions signed by the United Kingdom: The UK has concluded 106 Bilateral Investment Treaties (BITs) with other countries, of which 94 are in force. More information is available on the website of UNCTAD.

Administrative procedures relative to foreign investment

Freedom of establishment: Foreign companies establishing British subsidiaries generally encounter no special nationality requirements on directors or shareholders, although at least one director of any company registered in the UK must be ordinarily resident in the UK.
Acquisition of holdings: In the United Kingdom, a majority holding interest in the capital of a local company is legal.
Competent organization for the declaration: Companies house