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Foreign Investments 2017-11-12T17:12:05+00:00

Investing abroad

Over the last years, many small and medium business companies are more often exploring the export markets because of various factors. For mentioning some, the liberation of foreign markets, the developments in transportation, the easiest access to information about different opportunities in the different market worldwide, the desire to diversify investments.

Despite the above said advantageous, the process of internationalization is quite complex. A company that is looking to develop foreign markets for its goods and services need to choose the most appropriate entry strategy as well as consider the advantages and disadvantages associated with each one by giving always due regard to the system of law in place in the foreign market.

The entry strategies include:

  • licensing a foreign entity,
  • entering into a partnership with an existing entity in the target market,
  • setting up a new entity in the target market either alone or in partnership with another local entity, and
  • acquiring an existing entity in the target market or merging with one.

HOW CAN WE HELP

If you are thinking of setting up a business abroad or simply aim to extend an existent one, we’re here to help you. By using the most advanced tools, resources, and techniques to analyse, develop, and represent your case, we can assist you in:

  • performing a preliminary analysis of the law in place in the target market;
  • choosing the most appropriate entry strategy, whether contractual arrangements or equity structures;
  • negotiating, drafting, concluding domestic and complex international arrangements;
  • setting up the legal entity;
  • developing a tax plan;
  • looking for funds and financing retrieval for your business;
  • dealing with intellectual property matters;
  • obtaining any other support for developing and managing the business.

WHY SHOULD YOU CONSIDER GOING GLOBAL?

Seeking international growth as an importer-exporter implies facing a variety of new environments and new ways of doing business. Some of the specific advantages presented by successfully growing globally are:

  • You can extend the sales life of current products or services. If a product or service is getting obsolete in your domestic market or the domestic demand for it is not enough to expand your sales, you should think about introducing it in other markets with a higher demand. Be sure you choose a market that offers opportunities and whose customers desire to buy your product or service, then you will be able to obtain a new source of revenue.
  • You can exploit technological improvements and know how, facing the competition successfully in the international markets.
  • You can overcome some government’s restrictions on the production and distribution of certain commodities in the domestic market. These restrictions are generally imposed for social reasons.
  • You can Reduce dependence on current markets by spreading your risk.
  • You can have fewer business risks.

WHAT DO YOU NEED TO TAKE INTO ACCOUNT BEFORE GOING GLOBAL?

Whilst going global presents various advantages, it is also accompanied by a lot of aspects that need to be taken into account. The mechanism of carrying out business internationally is long and complex. Therefore, you should be well established and profitable in your domestic country before planning and be developing your international business strategy.

In particular, you should consider the following features:

  • Economic, technology, social, and environmental factors of the foreign country

If you want to run successfully your business abroad, do not ignore the cultural differences that shape the marketplace. Do your research about the country, get in touch with local entrepreneurs and build a relationship with them. Moreover, analyze your target customers and find out the reasons according to of which they should be attracted by your product or services.

  • Political risks

Be aware of the political stability of the country you are planning to start/extend your business in and therefore monitor political development. By doing so,  you can take appropriate action at any time. International terrorists, difficulties in moving funds within the country and interference in the ongoing operations, are only an example of the risks that can be occurred.

  • Languages

Assume that the business will be carried out in English, but be aware that your audience will not be bilingual. As a result, you should familiarise with the local language of the foreign country as well as provide the information of your products or services according to it. Bring your own interpreter whenever required and do not rely on the information provided by other parties.

  • Intellectual property

Intellectual property is regulated by the law of the country you decide to invest in and represents an important asset. Therefore, be aware of any regulations that may affect your business in the foreign market.

  • Contracts

By going global, you will be involved in several contracts, both domestic and international, so it is important fully understand the fundamental issues regarding them.

ANY QUESTIONS? ASK OUR INTERNATIONAL TRADE LAWYERS

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MAIN MARKETS

U.K.

The U.K is one of the largest economic markets in the world and is an important trading partner for many Countries, including the USA. It is a part of the European Free Trade Association as well as a member of the World Trade Organisation. London, its capital, is currently regarded as an important financial huge due to the presence of all the major International banks and financial institutions.

The main factors for which many businesses decided more often to invest in the United Kingdom include:

  • a simple and competitive tax rate system (corporation tax is the lowest in the G7 and joint lowest in the G20);
  • a transparent regulatory system;
  • low interest rates and several Government’s incentives.
  • Finance, banking and business services
  • Manufacturing
  • Creative industries
  • Film
  • Steel
  • Automotive
  • Transport equipment
  • Oil and gas.
  • Easy ways to set up and run a business.
  • Low tax rate environment for foreign investor.
  • Political and economic stability.
  • A legislation encouraging innovation and entrepreneurship.
  • An open and fair market and easy access to talents.
  • World leader in innovation, ranking second only to the USA for the quality of its research base.
  • Easy way to register a property;
  • A variety of helpful financial schemes.
  • Regulation. After leaving Eu, the UK will be free to establish its own regulations in sectors such as tax, finance and legal, tailored to its own needs, with many more benefits for new businesses.

UAE

Although the UAE was really unattractive and undeveloped twenty years ago, it is now regarded as one of the most important counties in the world for its  free approach to business and commerce as well as for its environments and regulations. Its business core is Dubai, an innovation and futuristic city which offers a high quality of living and attracts a lot of local and international entrepreneurs thanks to its innovative facilities, infrastructures, and government’s policy.  Moreover, it offers: 

  • No tax on corporate/personal income
  • low customs duties and tariffs, no trade barriers
  • political and economic stability
  • competitive real estate costs.
  • Oil Production;
  • Real Estate;
  • Retail;
  • Aluminium Smelting;
  • Cement;
  • Fish Processing;
  • Fish Meal;
  • Natural Gas Liquefaction;
  • Steel Milling.
  • Competitive import duties (4% with many exemptions)
  • Competitive energy costs
  • No foreign exchange controls
  • No trade barriers
  • Competitive real estate costs
  • Competitive financing costs and high levels of liquidity
  • No tax on either personal income or capital gains and English is widely spoken in business circles in the country.

CHINA

China is the one of the fastest growing emerging market in the world as well as one of the most appeal countries for doing investments. Thanks to the program of economic reforms began in 1978 and the massive government’s investment programs, it has become the world’s second-largest economy. Moreover, it is a really important manufacturing hub. Since 2010, it’s the world’s largest exporter and second-largest importer of merchandise goods, as well as the fifth largest exporter and third largest importer of commercial services. As a consequence, it should be the world’s largest economy once again by 2030.

On the other hand, China is a member of the World Trade Organisation since 2001 and has engaged in several bilateral and multilateral free trade agreements, including a new one under negotiation with Europe.

  • Mining and ore processing
  • Iron, steel, aluminium and other metals
  • Coal
  • Machine building
  • Armaments
  • Textiles and apparel
  • Petroleum
  • Cement
  • Chemicals
  • Fertilisers
  • Consumer products, including footwear, toys and electronics
  • Food processing
  • Transportation equipment
  • Telecommunications equipment
  • Commercial space launch vehicles
  • Satellites
  • Major emerging market;
  • Large trained labor pool;
  • Dynamic fast-growing economy;
  • Rapidly increasing consumer wealth;
  • Very low employment costs;
  • Local managers lack strong management skills;
  • China’s consumer class is expanding fast.

ITALY

Italy is a member of the European Union (EU), the Organisation for Economic Cooperation and Development (OECD), and the Group of Eight (G8) industrial nations. Thanks to its geographic position, at the center of the Mediterranean, Italy is an important logistics hub with a highly diversified export structure and strong manufacturing sector, as well as a trade center that attracts buyers from all parts of the world. Italy has a qualified workforce, with high technical understanding and experience in sectors such as manufacturing, food, and beverage, tourism, automotive and fashion. For this reason, a lot of products “made in Italy” are more often expected abroad in high quantity over the last years. Ferrari, Fiat, Ferrero, Armani are only a few of the major Italian brands known across the board. The Italy’s government, thanks to various resource allocated by EU, is currently supporting and encouraging the investments in research and development, especially in the southern regions, with several measures: tax incentives for technological starts up, tax credits, full deductibility from local tax of labour costs for employees hired on a permanent basis.

  • Tourism;
  • machinery;
  • iron and steel;
  • chemicals;
  • food processing;
  • textiles;
  • motor vehicles;
  • clothing;
  • footwear;
  • ceramics shrunk.
  • Strategic logistic hub, being a gateway to million consumers across the European Union, northern Africa and Middle East.
  • High level at research and innovation in many fields of life sciences (e.g. neurosciences), physics and engineering (e.g. robotics), and social sciences and humanities (e.g. high tech archaeology).
  • Incomparable quality of life;
  • key role in manufacturing and International trade.
  • several found sourcing at European level.
  • global competitiveness. Start/expand a business in Italy enables you to gain an in-depth know how in leading sectors, such as machinery and automation, fashion, design, and food.

SPAIN

Spain is the thirteenth largest economic power in the world and ranked fifth in the European Union in relation to gross domestic product (GDP). Thanks to its geographic position, It is an important gateway to the European continent from South American countries as well as from Europe to Latin America.

Some of the main factors for which International investors aim to either start/expand a business or buy a commercial/private property in Spain, include:

  • Good quality living;
  • nice weather;
  • a highly qualified and competitive business and professional environment;
  • High developed infrastructures and communications;
  • the country economic recovery;
  • low prices, a potential economic growth and easier accesses to credit.

Moreover, there are great business opportunities in expanding sectors – new communication, automotive, aerospace, environmental and pharmaceutical, chemical and biotechnology technologies – and several fiscal incentives to forest research, development, and innovation. As a result, investors can benefit from having access to various European aid programs.

  • Automotive;
  • Tourism;
  • Food and beverages;
  • Metals and metal manufactures;
  • Chemicals;
  • Shipbuilding;
  • Pharmaceuticals;
  • Medical equipment;
  • Footwear
  • Spain’s economy is currently growing at a very high rate. Spanish exports have been significantly increasing in the last two years, and as a result the traditional trade balance deficit is being drastically cut. At the same way, Spanish companies have been investing abroad gaining international competitiveness.
  • Strategic position with access to a potential market of over 1.2 billion consumers in Europe, Latin America and North Africa.
  • Good level of science and technology.
  • Attractive tax regime to start/expand a business.
  • Several incentives at European, national, regional and local levels from which investors can benefit.
  • Stable political system.

USA

The United States is the world’s largest economy with a population and consumer market of more than 310 million people. It has a stable economic, political, and legal structure that offers a wealth of opportunities for foreign companies and investors. The USA is the world’s third-largest producer of oil and natural gas, the second largest trading nation in the world and the second largest manufacturer. It has entered into several free trade agreements with 19 countries, providing access to a further 415 million customers for U.S. goods and services. The dollar is still the most powerful currency in the world and it has a modest unemployment rate. As a result, USA is an ideal place to do business, having significant natural resources, a healthy labor market, and solid industries. It is consistently ranked among the best internationally for its overall competitiveness and ease of doing business. At the same time, USA offers a wide range of funding sources – from banks and investment firms to venture capitalists and angel investors – for the purpose of enhancing innovation and expansion.

  • Energy;
  • Manufacturing;
  • Healthcare;
  • Transportation;
  • Agriculture.
  • USA is the largest market in the world;
  • easy ways of doing business: regulatory environment suitable to start/expand a business;
  • innovation: USA is regarded as the leader in research and development, and registers more international patents than any other country;
  • access to various and distinct funding sources. The USA’s Government aims at enabling innovation and expansion;
  • USA is rich of natural resources, such as petroleum and oil;
  • USA has the top brands marks (Coca Cola, Apple, Google);

NEED HELP?

We’re here to help answer your questions. International matters can be complicated, our experts are on hand to help inform you of every aspect regarding your topic. We take great pride in using our expertise for you and look forward to hearing from you.

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