Knowledge Notes

Reviewing our UK business law predictions for 2023: how are we doing at the half-way point?

Published on 19th Jul 2023

We examine how our predictions have turned out in practice, and what to watch out for as autumn draws nearer

Close up of people in a meeting, hands holding pens and going over papers

In January 2023 our Osborne Clarke Knowledge Lawyers made their business law predictions for 2023. Here, we see how those predictions are faring.


We thought that "businesses and their advisers are likely to sharpen their focus on the Opposition's emerging plans for the economy" – perhaps not the craziest of predictions, and we can put a tick next to that one. The Labour Party has been setting out its "five missions" for when and if it enters government, one of which is to "make Britain a clean energy superpower", as we discuss in this Insight.

On Brexit, we expected a "growing awareness and frustration, extending beyond the business community, of the frictions that Brexit has introduced into UK-EU relations". In polling results released in June 2023, the think tank UK in a Changing Europe found that only 18% of 2016 "Leave" voters thought Brexit is going well. Although, optimistically, 61% of those voters think it will turn out well in the end.

Still in Brexit-land, we guessed that the Retained EU (Revocation and Reform) Bill would "run into the sand amid opposition in the Lords and overwhelming scepticism in Whitehall". This was spot on. The bill made it into law, but its principal feature – the "sunset" of all retained EU law on the statute book at the end of 2023 – was abandoned, as we discuss in our detailed Insight.


Our experts expected "further legislative reform on industrial action and strike law". With strikes continuing across a number of sectors, the Strikes (Minimum Service Levels) Bill has not yet received Royal Assent but has passed through both the Commons and the Lords, with amendments now being considered.

Regulations the government introduced back in 2022 essentially permitting the use of agency staff to cover for striking workers or those taking part in other industrial action (or to cover the work of an employee who is covering the work of an employee taking part in a strike) have been subject to legal challenge. The High Court has now ruled that the regulations are unlawful and are quashed with effect from 10 August 2023. The position will therefore revert back to that pre-July 2022, meaning that the use of agency workers to cover these specific circumstances are once again prohibited. Read more.

In January, we noted that "there are currently a number of proposed legislative reforms progressing through parliament aimed at supporting employee wellbeing throughout employment", and indeed legislation has now been passed which provides for a new right for one week's unpaid carer's leave, paid neo-natal leave and extending the special protection on redundancy for those who are pregnant or returning from a period of statutory family leave – although we are awaiting regulations which set out further details of these rights, with speculation that we may see carer's leave and the extended redundancy protections coming into force in April 2024 and neo-natal leave in April 2025. Read more in our Insight.

The government has confirmed that it is not proposing any changes to the system of shared parental leave following an earlier consultation but some relatively minor changes to statutory paternity leave are proposed; again we do not anticipate these being introduced before April 2024. Read more.

And with more attention being paid to the "older" workers, we recently produced a report on the ageing population, based on research carried out on our behalf by Censuswide, which looks at the challenges for employers in recruiting and retaining older workers. You can read observations from the report in our Insight.

We thought that employers would "see more individual and collective grievances", and it is clear that businesses are reacting to the challenges of a tough economic climate through redundancies and restructurings. The government has now published a draft statutory code on fire and re-hire and the consultation closed on 18 April 2023, on which we await further developments.

There is a continuing backlog of claim in the tribunals; to address the increasing number of complex discrimination and whistleblowing claims, the President of the Employment Tribunals has recently published new guidance on alternative dispute resolution mechanism, including a new process of dispute resolution appointments which were trialled in one tribunal region during Covid-19.

Finally, we expected an important Supreme Court decision on the ongoing holiday pay litigation; this has not yet been forthcoming, but in the meantime the government has published a consultation on proposed amendments to the Working Time Regulations 1998. It has also issued a response to the consultation on non-compete provisions, and announced that when "parliamentary time allows" it will introduce legislation which will cap non-compete provisions in employment contract to three months. Read more here and here.

Real estate

We thought there would be "widespread non-compliance with the requirement for overseas entities holding UK real estate to register their beneficial owners at Companies House by 31 January 2023". But compliance appears to have better than we expected; it has been reported by Companies House that as at 23 June 2023, more than 28,000 out of some estimated 30,000 overseas entities have now registered.

As we approach the first anniversary of the opening of the register, the government now appears to be toughening its approach to non-compliance (as demonstrated by the publication in June of the Register of Overseas Entities (Penalties and Northern Ireland Dispositions) Regulations 2023 (SI 2023/696) and by Companies House guidance on how the registrar intends to use its powers of enforcement). So we see a stricter road ahead.

Those overseas entities who first registered last year will shortly be required to file their first annual update to Companies House, confirming whether there has been any change to the entity's beneficial ownership. Failure to do so is a criminal offence and will render the overseas entity ID invalid – which may cause fresh delays to certain land transactions involving overseas entities.  

The Economic Crime and Corporate Transparency Bill, which is nearing Royal Assent, will (in its current form) amend the updating duty so it is triggered upon any change to an entity's beneficial ownership and also upon disposal of a qualifying estate, adding further administrative burden and scope for transactional delay.

Perhaps uncontroversially, we predicted that investors and occupiers are likely to continue the push for greener buildings, and companies continue to make public commitments to address climate change. Implementation is now a key focus, as is a growing awareness of the legal and reputational risks associated with greenwashing. Tightening legal requirements have also compelled property owners to examine their buildings and to make energy efficiency improvements to comply with new (and where economically feasible, anticipated future) standards.

Similarly, we thought decarbonisation ambitions would drive an increase in agreements between landlords and tenants to reduce the environmental impact of their building, and in the market we have seen requests for green lease provisions in leases becoming more prevalent, demonstrating an elevated focus on ESG (environmental, social and governance) and an acceptance of the need for a collaborative approach. The rise in smart building technology, with the capability of collecting data and analysing building performance, is also driving the need for parties to consider these issues in legal agreements.

Further green initiatives are expanding the scope of the traditional landlord-tenant relationship as occupiers seek more from their premises: with requests for rooftop solar installations for the generation of green energy and onsite electric vehicle charging points.

As expected, the minimum energy efficiency standards (MEES) rules tightened on 1 April 2023. As property owners are still grappling with this, many properties are still in breach, but we are still waiting to see the level of enforcement action from Local Authorities. Our Insight on the situation is here.

Also as expected, implementation of requirements under the Building Safety Act 2022 for management of fire and structural risks in high rise residential buildings continues. Read our Insight on registration requirements for existing high-risk buildings. Publication of regulations to support the implementation of a more stringent building control regime under the Act is, however, still awaited.

Finally, we expected judgment from the Supreme Court on the finely-balanced point of law in the high-profile Fearn and others v The Board of Trustees of the Tate Gallery, where the Tate gallery's neighbours, whose residences feature floor-to-ceiling windows, created a "self induced incentive to gaze", as the Court of Appeal ruled.

Judgment was indeed forthcoming, with the Supreme Court holding that the Tate Modern's viewing platform, from which members of the public could look directly into a number of luxury residential flats within the Neo Bankside development, subjected the appellants to a substantial interference with their ordinary use and enjoyment of their properties (which was more than "mere overlooking") and did constitute a private nuisance. Whilst this decision was highly anticipated, given the unique facts of the case, it is unlikely to have a substantial practical impact or lead to a flood of similar claims. Read our Insight on this case.

Intellectual property

As expected, the Unified Patent Court launched in mid-2023, but has not yet heard any cases. View our collection of Insights on various aspects of the UPC.

We await judgment on most of the litigation we mentioned in January, other than the High Court ruling on trade mark bad faith in Lidl v Tesco, which we discuss in this Insight.

More generally, we – together with the rest of the business world - noted the rise of generative artificial intelligence (AI); we collect our various Insights and other materials on AI here.

Financial services

Uncontroversially, we expected the "Edinburgh Reforms", announced by the chancellor in December 2022, to "make major changes to how the sector is regulated". The Financial Services and Markets Bill 2022-2023 received Royal Assent on 29 June 2023 and was published as the Financial Services and Markets Act 2023 in July 2023, less than a year after it was introduced to parliament. This landmark new law, hailed by the government as a major move to "regain control of the financial services rulebook", will enable delivery of the Edinburgh Reforms, as well as the key outcomes of the Wholesale Markets Review, cryptoasset regulation, and protections for authorised push payment fraud victims.

The Mansion House Reforms, announced by the chancellor in July 2023, build on their Scottish predecessors, including measures aimed at boosting outcomes for pension savers, incentivising companies to grow and list in the UK, and delivering a "smarter" regulatory framework. Initiatives featured in the package include the repeal of retained EU financial services law, a new independent review into the future of payments, and the government's response to the consultation on reforming the Consumer Credit Act.

In January, we looked forward to the Financial Conduct Authority's new Consumer Duty, which goes live for open products and services on 31 July 2023. The duty is being widely referred to in dialogue between the regulator, government and high street banks around the speed with which higher interest rates are being passed on to savers, as the cost of living crisis continues to bite.

Digital regulation

We expected 2023 to be the year when the EU's AI Act takes shape, with the emergence of powerful "general purpose" AI systems such as ChatGPT since the original draft of the Act was issued in April 2021 emphasising the challenge for legislators in creating a regulatory framework.

The key provisions of the AI Act are currently expected to be settled in the autumn. As anticipated, the huge growth in public discussion of generative AI in the last six months means that the AI Act framework is expected to be expanded to include it specifically. Legislators have proposed amendments to deal with "foundation models" that perform a particular function but can be used in many applications (including generative AI systems). Such systems do not fit well into the risk-based tiers of the AI Act because they present a variable level of risk, depending on the application to which they have been put.

There has also been significant impetus at multinational level to agree a common approach to AI regulation, moving faster than the AI Act.  More detail is included in our recent update on the status of EU, UK and international AI regulation.

Our prediction that 2023 would be the year when other landmark pieces of EU digital regulation start to come into force, including the Digital Markets ActDigital Services Act and Data Governance Act, proved correct. The Data ActCyber Resilience ActAI ActAI Liability Directive are close behind in the legislative process, as well as digital-focused overhauls of consumer law and product regulation. Businesses around the world that offer digital products, services and platforms to EU customers are facing a complex jigsaw of compliance with potentially challenging intersections.  

We expected that 2023 could see digital regulation becoming an area of significant divergence between the EU and UK regimes. Having fallen behind the EU, the UK has begun to catch up on developing data and digital regulation. Divergence certainly is a feature of some of the UK reforms and initiatives. Since the shift in approach on retained EU law, however, the emphasis in some areas has moved away from taking the opportunity to be different to the EU, to a difference in strategy, with the UK digital economy seen as an engine for productivity and growth.

On data regulation, under the UK Data Protection and Digital Information (no 2) Bill (more here), "smart data" provisions will enable minsters to open up consumer data flows in particular sectors (similar to the approach in open banking), rather than creating a cross-sector horizontal right of access to data, as the EU's Data Act does. The focus is on boosting competition and ensuring value for consumers, rather than opening up data as an end in itself.

On digital markets regulation under the UK Digital Markets, Competition and Consumer Bill (more here), the UK plans to shape bespoke regulatory requirements for digital firms designated as having "strategic market status", compared to the blanket rules under the corresponding EU DMA regime for digital market "gatekeepers".

AI regulation is a notable area of divergence, with the EU planning a full horizontal regulatory regime around AI while the UK's white paper of March proposes instead to issue high level principles to shape the exercise by existing regulators of their existing jurisdiction and enforcement powers.

An issue that has come into focus this year is how the growth of AI and digital technology more generally will have an impact on questions of exclusion. Many aspects of this question have a legal and regulatory compliance angle, as we explored in our infographic looking through a legal lens at digital inclusion by design.


With the cost of living continuing to rise, we thought that employees might look to reduce their pension contributions or even to opt-out of pension saving in order to maximise their take-home pay. We also anticipated that businesses with final salary (defined benefit) pension schemes could receive questions from pensioner or deferred members about the "in payment" or "in deferment" increases they receive. The Pensions Regulator has since issued guidance and we have considered how both employers and pension scheme trustees could support members.

We are still waiting for further news on the changes to the notifiable events rules. The new defined benefit scheme funding regime is also delayed and no longer expected to apply from 1 October 2023.

We expected to see a continued focus on value for money in money purchase (defined contribution) pension schemes, and the Pensions Regulator has announced the launch of a new regulatory initiative under which it will check that the trustees of defined contribution schemes/sections with assets under management of less than £100m are complying with the new value for members requirements that came into force in October 2021. The government, the Pensions Regulator and the Financial Conduct Authority have also consulted on a common Value for Money (VFM) framework and regulatory regime for occupational (trust based) and personal (contract based) defined contribution schemes.

For final salary (defined benefit) schemes, the government has published the response to its consultation on consolidation through "superfunds" and a call for evidence "to support the development of innovative policy options which have the potential to offer more choices for defined benefit … pension scheme sponsoring employers and trustees, increase protection for DB members and also support wider economic initiatives".

Finally, both pensions dashboards and the new requirement to have an effective system of governance (or ESOG) have run into some delay. In both cases, however, more news is expected soon and the message is that trustees should continue to prepare.


We predicted that the post-Brexit UK is still unlikely to be allowed to join the Lugano Convention, but may join the EU in signing up to the Hague Convention on the Recognition and Enforcement of Foreign Judgments in Civil or Commercial Matters 2019. The UK remains blocked from re-joining Lugano, although the UN Working Group on Business and Human Rights has asked the European Commission to justify its position. The consultation carried out by the Ministry of Justice on the UK joining the Hague Convention 2019 closed at the end of February 2023 and we are currently waiting for its report.

Joining the Hague Convention 2019 will go some way to filling the gaps left when the UK joined the Hague Convention on Choice of Court Agreements 2005, which applies only if the parties have agreed an exclusive jurisdiction clause. The 2019 Convention will apply where the parties have agreed a non-exclusive or asymmetric jurisdiction clause.


As anticipated, the UK has started to roll out its Electronic Travel Authorisation (ETA) visa waiver programme. ETA waivers will be expected for Qatari nationals from November 2023. This will be extended to Bahrain, Jordan, Kuwait, Oman, Saudi Arabia and United Arab Emirates in February 2024. Further countries will be added gradually.

The European Travel Information and Authorisation System (ETIAS), which requires pre-registration ahead of arrival for anyone who does not require a visa to visit the European Union (like the ESTA for the USA), remains in the pipeline. Under the ETIAS, UK travellers will also need to apply by submitting details on health, education and criminal convictions. It will be valid for three years. ETIAS is on track to come into force in November 2023, provided there are no further postponements.

In relation to sponsored workers, we have seen a move towards digitisation by the UKVI (UK Visas and Immigration) in relation to processing visas. A recent and significant development is that the UK government has announced a 15-20% increase in submission fees and a doubling of the Immigration Health Surcharge, thus considerably increasing the cost of sponsorship of overseas workers.

Other changes in relation to students and their ability to bring dependants with them to the UK and in relation to switching have also been announced. This will make it more complex for UK employers looking to sponsor students or student dependants – following an incorrect process for sponsorship will lead to refusal. So while the systems used for applying are being streamlined and digitised, the rules surrounding, specifically, skilled workers are becoming more complex.


In January, we were looking ahead to the progress of the Procurement Bill. As discussed in the June issue of our Regulatory Outlook, the Cabinet Office has announced that it is now planning for an October 2024 "go-live" date for the new procurement regime, following a six month preparation period. This has been pushed back from the previous go-live date of early 2024.

The bill is now in its final stages, with the date still to be announced for when the House of Lords will consider the House of Commons amendments.

The Cabinet Office has also launched a second consultation on draft secondary legislation under the bill, focusing on the transparency notices that are required under the new regime. Additionally, this consultation covers the organisations covered by the term "defence authority" used in the bill and a number of other matters that feature in the draft Statutory Instrument relating to transparency,

This autumn we will be running a series of events on the new Procurement Act (as we expect the bill will become), including webinars on how supplier performance will be monitored when bidding for and performing public contracts (and what happens if performance is not up to scratch), transparency and bringing procurement challenges.

Corporate Tax

Looking ahead in January, we expected more tax reforms around capital investment tax reliefs to support future business investment and innovation. This came to pass, with the Spring Budget announcing a new capital allowances regime to introduce full expensing for the next three years (with the legislation included in the Finance (No 2) Act 2023). The chancellor also announced the creation of 12 "investment zones", first proposed by the Truss administration in 2022, but now with a more targeted reach.

We saw further changes to the tax treatment of investment funds coming, with the aim of making the UK a more attractive destination for funds. The Spring Budget announced (and Finance (No 2) Act 2023 enacted) even more changes for real estate investment trusts (REITs) – to reduce administrative burdens for certain partnerships investing in them. Changes were also made to improve the scope of qualifying asset holding companies regime. The government also announced that it is consulting on the introduction of a new "Reserved Investor Fund" (the RIF). The RIF is a new fund structure designed to complement and enhance the UK’s existing funds regime by meeting industry demand for a UK-based unauthorised contractual scheme with lower costs and more flexibility than the existing authorised contractual scheme.

The UK, as predicted, continues to move away from EU-derived legislation, for example through the implementation of the UK Mandatory Disclosure Rules which came into force on 28 March 2023 and which follow OECD rules, replacing the EU's DAC6 regime in the UK.

As we also foresaw, the government has introduced legislation (in the Finance (No 2) Act 2023) to implement the OECD proposals for the global minimum corporate tax rate to take effect from accounting periods beginning on or after 31 December 2023.


We expected increased interest in tax-advantaged plans, in particular company share option plans. Improvements to discretionary plans (company share option plans and enterprise management incentives) came into effect on 6 April 2023, as we discussed in our Employee Incentives Update | May 2023 (and see also our Insight on Enterprise management incentive options – simplification of the grant process).

HMRC is now turning its attention to improvements to all-employee plans (the share incentive plan and SAYE plan), with a call for evidence launched in June and an updated SAYE bonus rate mechanism coming in from August 2023, as covered in our Insight.


As anticipated, there is likely to be significant overlap between firms designated with "strategic market status" under the Digital Markets, Competition and Consumers Bill (DMCC) in the UK and those identified as "gatekeepers" under the EU's Digital Markets Act (DMA). The impact of the DMCC Bill is expected to be felt in 2025. Both regimes will impose significant conduct requirements on designated firms. The DMCC designation procedure is likely to create challenges, as we have seen with DMA designations: it seems unlikely that the DMCC Bill will fare any better in this regard.

The UK government, EU Commission and a number of EU Member States have introduced legislation aimed at controlling investment with the potential to impact national security or internal market conditions.

In the UK, the National Security and Investment Act continues to have a substantial effect on deal timeframes, as indicated by the government's recent report into its functioning between 1 April 2022 and 31 March 2023.

The EU Foreign Subsidies Regulation came into force on 12 July 2023 and is likely to have a significant impact on M&A activity and public procurement within the bloc. The notification requirement under this regulation comes into force on 12 October 2023, presenting an additional layer of compliance for companies undertaking M&A or public procurement activity within the EU.

Additionally, France, Germany, the Netherlands and Belgium are all moving up a gear to filter FDI to protect their national security interests.


We anticipated seeing increased pressure from the EU Risk-Free Rates Working Group to start including €STR (Euro short-term rate) fallbacks in loan agreements, and in May of this year that Working Group published guidance which concluded that corporate lending products now need to implement robust fallback provisions in new and refinanced EURIBOR referencing loans. The guidance states that cost of funds and replacement of screen rate language are not workable permanent fallbacks and do not provide scalable options in the case of a possible permanent discontinuation of EURIBOR.  It further reminds market participants that they need to be operationally ready for EURIBOR fallbacks (be that compounded €STR in arrears or term €STR with waterfall structure) to avoid future market disruption. EURIBOR is not scheduled to be discontinued, but the guidance states that this does not negate the need for market participants to include robust fallback language in their contracts.

We also looked forward to seeing more Sustainability-Linked Loans (SLL) in 2023 and they have certainly come into sharper focus, with the Financial Conduct Authority (FCA) publishing a letter to SLL market participants following its engagement with stakeholders in March and April.  The FCA is keen to ensure that integrity is maintained in the market and to encourage further development of SLL products as an important transition financing tool.  It also drew attention to the weaknesses that were identified including (i) conflicts of interest and weak incentives to issue SLLs and (ii) credibility, market integrity and greenwashing. The LMA's (Loan Market Association) SLL Principles were identified as a positive way to help address some of these concerns. We expect to see the continuing growth of third party ESG specialist advisers and lender willingness to take on active ESG co-ordinator roles on transactions, but tighter regulation may lead to some reluctance from certain lenders to risk exposure to greenwashing allegations.


The Economic Crime and Corporate Bill remains in "ping pong" between the Commons and the Lords. Royal Assent could come before the summer recess this week or may yet slip into September.

We looked forward to two separate but linked taskforces publishing reports that are likely to lead to fully digital share registers. The UK Jurisdiction Taskforce completed its public consultation and in February 2023 published a legal statement on the issuance and transfer of equity or debt securities on blockchain or distributed ledger technology under English law. Separately, on 11 July 2023, the government's Digitisation Taskforce published its interim report on how to fully digitise the UK shareholding framework to eliminate the use of paper certificates. It is seeking feedback on its recommendations until 25 September, with a final report due in the first quarter of 2024.

If you would like to discuss any of the issues raised in this Insight, please get in touch with your usual Osborne Clarke contact, or one of our experts listed below.


* This article is current as of the date of its publication and does not necessarily reflect the present state of the law or relevant regulation.

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