Selling a business is rarely straightforward — but when international operations are involved, the legal complexity increases significantly. Cross-border sales introduce a web of jurisdictional, regulatory, and contractual considerations that can catch sellers off guard and delay or derail deals if not properly managed.
Whether you operate through overseas subsidiaries, foreign branches, or international sales channels, understanding the legal implications early in the process is essential to securing a clean, value-maximising exit.
1. Understanding the Corporate Structure
The first step is to map out the ownership and legal structure of the group. Does the UK company own 100% of a foreign subsidiary? Are there minority shareholders overseas? Is revenue generated abroad under a UK legal entity or through separate trading companies?
Each variation can have legal consequences — from the requirement to produce separate financials to whether local shareholder consent is needed for a sale.
Tip: Ensure you can present a clean, logical corporate structure to potential buyers — ideally one that won’t require extensive legal restructuring post-sale.
2. Cross-Border Legal & Regulatory Compliance
Selling a business with international operations means facing a patchwork of legal regimes — each with its own rules on:
Employee transfer rights (e.g. TUPE or local equivalents)
Data protection compliance (e.g. GDPR vs. other data laws)
IP ownership and usage rights across jurisdictions
Export control or industry-specific licensing
Foreign investment approvals (required in some territories)
Buyers will assess the legal and compliance risk of your international operations during due diligence — and any gaps may be used to reduce the offer price or demand indemnities in the sale agreement.
3. Tax Considerations
Cross-border tax planning is critical. The sale of international assets or shares may trigger:
Capital gains tax in multiple jurisdictions
Withholding taxes on proceeds repatriated to the UK
VAT or sales tax implications depending on deal structure
Double tax treaties which can reduce or eliminate certain tax exposures
It’s important to work closely with tax advisers who understand international M&A to ensure the deal is structured efficiently and avoids unexpected liabilities.
4. Foreign Exchange & Repatriation of Funds
Will part of the purchase price be paid in a foreign currency? Are there any controls or restrictions on moving money out of specific jurisdictions?
These factors may impact deal timing, payment terms, or escrow arrangements — particularly in emerging markets where capital controls are in place.
5. Local Legal Counsel May Be Required
In many cases, local law firms will need to be engaged in each relevant jurisdiction to:
Review employment and lease contracts
Confirm local compliance
Draft or adapt parts of the sale agreement to meet local law
Manage the legal transfer of shares or assets in overseas subsidiaries
An experienced UK M&A adviser will coordinate this process to ensure it runs smoothly — but it’s important sellers understand that additional time and legal costs are often required when international elements are involved.
6. Sale Structure: Share vs. Asset Deal
If the business owns companies in multiple countries, the buyer may propose:
A share sale of the UK parent (transferring control of all subsidiaries), or
A carve-out transaction involving specific assets or divisions in certain territories
Each option has different legal implications. A share sale may simplify the transaction, but could expose the buyer to unknown liabilities within foreign subsidiaries. Asset sales may limit risk but trigger new contracts, employee transfers, and local tax charges.
Final Thoughts
Selling a business with international operations demands expert coordination and legal planning across borders. It’s not just about finding a buyer — it’s about ensuring that your business can be sold cleanly, compliantly, and without unpleasant surprises for either party.
The good news? With early preparation and the right advisory team, even complex international sales can be executed efficiently — often unlocking premium value due to the buyer’s desire to enter new markets.
Considering a sale involving international operations? Speak with an experienced adviser to help you navigate international legal, tax, and commercial challenges and position your business to attract the right global buyers.
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