Despite the broadly positive picture, Chinese companies may overlook the regulatory and compliance complications of investing in the U.K.
The U.K. is attractive to Chinese companies with global ambitions. As a major international financial centre and the world’s biggest foreign exchange trading hub, London plays a key role in China’s push to internationalize its currency, the renminbi, and for its banks and financial institutions to expand globally.
Other factors underpinning the U.K.’s appeal as an investment destination have been that it is a traditional defender of free trade, has a liberal economic environment, and currently has a relatively weak currency, according to a new white paper jointly released by TMF Group and China-Britain Business Council (CBBC).
Negative Trends
«Despite the broadly positive picture there are several forces that could impact future investment trends negatively. Chinese companies may overlook the regulatory and compliance complications of investing in the country,» Felix Ndeloa, Director of Consultancy Solutions at TMF U.K., says.
These include an intricate tax regime and stringent rules around employment and data protection. «These issues argue for Chinese firms seeking the support of a knowledgeable local partner who can help ensure their operations are compliant and continuously up to date across taxation, accounting, employment and data policy – especially as factors like Brexit seem likely to rapidly shift the picture in some areas,» adds Ndeloa.
After Leaving the EU
«Uncertainties surrounding Brexit could temporarily impact investment activity, but in the long run CBBC is confident that the U.K.’s investment environment will prove attractive to Chinese investors. As the U.K. creates new trade and investment relationships after leaving the EU, China will become an even more important partner, Weifeng Ma, at CBBC says.
