REGULATION: 78% of businesses fought actions in past year


UK clients have seen a steep rise in the amount of litigation they face - with the number of companies currently fighting more than 15 lawsuits having tripled in the past year, research claimed this week.



A report by US firm Fulbright & Jaworski found that 78% of UK businesses faced a court action in the past 12 months, with 15% battling more than 15 actions against them.



Clients cited regulatory issues as their greatest litigation worry, followed by employment and personal injury. Some 38% of companies questioned said they had seen an increase in regulatory inquiries and investigations in the past year.



Almost one-fifth of UK clients expected spending on legal disputes to increase in the future, while 67% predicted it would remain the same. Only 5% anticipated a decrease.



UK clients use fewer external lawyers than their US counterparts, the report revealed. In the US, 42% of respondents hired more than 11 firms, compared to just 9% in the UK.



Lista Cannon, head of European disputes at Fulbright & Jaworski in London, said: 'We are moving away from the comfort zone where the UK is seen as a less regulatory environment than the US. UK regulation is escalating.' She added that employment claims are likely to increase next year because of new age discrimination legislation.



Martyn Hopper, contentious regulatory partner at City firm Herbert Smith, added: 'The overall impression is that there has been a rise in investigation and enforcement activity, in particular relating to financial institutions and the insurance market, where we have seen the regulatory requirements increase. On the listed company front, there have been more actions relating to corporate disclosure and listing rules.'



The report surveyed 422 listed and unlisted companies worldwide, including 45 from the UK.



Rachel Rothwell