An often overlooked issue but one which is becoming increasingly relevant in our global world is the requirement for a legal opinion letter where UK legal documentation is to be executed by a foreign company.

In general terms, companies registered in England and Wales, Scotland and Northern Ireland are not deemed to be foreign companies but companies formed in the Channel Islands and Isle of Man and elsewhere are.

The opinion letter should be obtained from a firm qualified to practise in the foreign company’s country of registration.The letter should verify that:

  • The foreign company validly exists under the law of the foreign jurisdiction and has the capacity to enter into the relevant transaction;

  • Any judgement arising from the documentation obtained from a Court in England and Wales is enforceable against the foreign company in its country of incorporation; and

  • Any local legal and procedural requirements have been fulfilled.

The foreign legal opinion should of course be checked by the English lawyer before completion to ensure that any assumptions made do not invalidate the purpose of the opinion.

If these requirements are overlooked they can often cause timing issues at completion.A simple solution would be to include the requirement in Heads of Terms at the outset.

Pini Franco LLP ‘s Italian qualified lawyers are well placed to provide legal opinion letters in respect of Italian corporate entities operating in the UK .