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New AIM rules (August 2026)

Fri, 14 Aug 2026 00:00:00 +0100

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New AIM Rules (August 2026)

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The London Stock Exchange has implemented significant reforms to the AIM Rules for Companies and the AIM Rules for Nominated Advisers (AIM Rules), following consultations earlier in 2026 (see our post on the previous consultation here). The majority of the reforms consulted on have been adopted and the reforms, which became effective on 5 August 2026, represent the most comprehensive changes to the AIM Rules since the AIM market was launched in 1995.

Published: 14 August 2026
Authors: Oliver Pilkington

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The changes reposition AIM following changes to the UK Listing Rules implemented in July 2024 which had rendered the rules applicable to AIM companies similar, and in some areas more stringent than, those applicable to Main Market companies. The changes are intended to reduce regulatory burdens, improve access to capital and make AIM more attractive to founder-led and growth companies. The key changes are summarised below.

1. Admission process simplified

Working capital statements abolished

The requirement for an admission document to contain a formal working capital statement has been removed. Instead, issuers must provide disclosure regarding their capital resources, financial commitments and obligations, the use of proceeds of any fundraising undertaken on admission, and expected funding requirements over the 12 months following admission. Responsibility for assessing the company's financial position remains with the company and its directors.

Incorporation by reference permitted

Admission documents may now incorporate publicly available information by reference, which should help to reduce document length and duplication. Hyperlinks to the relevant information must be included in the admission document and such information must remain publicly available for as long as the admission document itself is required to remain available under AIM Rule 26.

Accounting flexibility

AIM applicants incorporated in the UK or EEA may now prepare and present their accounts in either IFRS or local GAAP. This is intended to avoid the need for accounts to be restated under IFRS in connection with an AIM admission which can add significantly to transaction costs and affect timing.

2. Capital access windows

AIM companies conducting an equity fundraising or other transaction involving the issue of AIM securities may request a temporary suspension of trading referred to as a "capital access window". The purpose of the capital access window is to give issuers a controlled environment to manage negotiations, reduce execution risk, and prevent market volatility or price shifts from derailing capital raises.

The Exchange has deliberately avoided prescribing minimum or maximum periods and will consider requests on a case-by-case basis. Companies remain subject to UK Market Abuse Regulation (MAR) and AIM Rules obligations during the suspension period.

3. Transaction rules modernised

Reverse takeovers narrowed

A transaction will only constitute a reverse takeover if it results in a fundamental change to the company's business, board or voting control. Exceeding 100% under any of the class tests is no longer, of itself, determinative. Instead, the Exchange expects consultation where the transaction exceeds 100%, is not a fundamental change and shareholder approval is not being sought. Decisions will be made on a case-by-case basis.

Substantial transaction threshold increased

The threshold for a substantial transaction has increased from 10% to 25%, aligning AIM with the UK Listing Rules.

Related party transactions

Participation in a fundraising by directors or substantial shareholders will no longer constitute a related party transaction provided (i) they participate on the same terms as other investors and (ii) the price is set either by directors not participating in the fundraising or by agreement with investors who are not related parties.

The definition of related party has been expanded to include: (i) any company one or more of whose directors is also a director of the AIM company; and (ii) any person with a 10% interest (or more) in an AIM company's subsidiaries and/or assets.

Nominated advisers are no longer required to provide a "fair and reasonable" opinion on non-standard remuneration arrangements where they are satisfied reasonable commercial protections exist for the AIM company and such protections are disclosed. Guidance has been added on what constitutes ‘standard’ and ‘non-standard’ remuneration and provides that, where a nominated adviser is not satisfied that reasonable commercial protections are in place, shareholder approval of any non-standard remuneration should be sought.

4. Ongoing Developments

Rule 11, which previously required general disclosure of price sensitive information, has been replaced with a new ‘Ongoing Developments’ rule which makes it clear that the disclosure regime under the AIM Rules is not intended to conflict with the disclosure regime under MAR. The new Rule 11 specifies that an AIM company must have in place procedures enabling it to monitor and identify any changes that may have a material impact on its business, must keep its nominated adviser updated regarding any such changes and have due regard to the views of its nominated adviser when considering its disclosure obligations under MAR.

The guidance to Rule 11 states that, when providing any view regarding market impact, a nominated adviser is undertaking its obligations to the London Stock Exchange and its view should therefore be considered authoritative. The guidance also provides that, where a nominated adviser considers that a change or development is likely to have a market impact but the AIM company decides not to notify the information without delay (and there is no basis to delay under article 17(4) of MAR) the AIM company and/or its nominated adviser must notify the Exchange immediately and provide the rationale.

5. Special voting shares permitted

AIM will now permit special voting shares at admission, allowing founders, management teams and pre-IPO investors to retain enhanced control rights. Enhanced voting rights may not be exercised in relation to (i) remuneration, (ii) related party transactions involving the holders of such shares or (iii) cancellation of admission.

Special voting shares cannot be issued, nor can the rights attached to them be extended, at any time after admission. A holder of shares with special voting rights may not transfer such rights to a person who would not have qualified to receive them at admission.

Unlike many other markets (including the Main Market), the Exchange has not imposed any mandatory sunset provisions or time limits. An AIM company may reduce or withdraw such rights at any time following consultation with the Exchange.

6. Corporate governance

AIM companies are no longer required to adopt a recognised corporate governance code or disclose how they comply with such a code under the "comply or explain" model.

Instead, AIM Rule 26 now requires disclosure across the following prescribed governance areas: (i) board composition, (ii) director roles, responsibilities and functions, (iii) remuneration and performance, (iv) risk and controls framework and (v) investor relations. The intention is to provide investors with sufficient understanding of governance arrangements without forcing AIM companies to comply or explain non-compliance with a pre-existing code.

7. Express market admission route

The existing Designated Market route has been replaced by a broader ‘Express Market’ route. This is intended to provide for a quicker and less onerous and admission process for companies already listed on an Express Market (essentially any market overseen by a member of the International Organisation of Securities Commissions. Express Applicants must (i) have had its securities traded on an Express Market for at least 3 years, (ii) not had any fundamental changes to its board or business in the last 12 months, (iii) have a proposed market capitalisation on admission to AIM of at least £20 million, and (iv) have any relevant admission documentation and all disclosure required under the rules of its home market published in English.

If you wish to discuss this article, please contact the author or your usual Shoosmiths contact. We are here to answer any questions you may have.

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Working Load Limit: can your supply contracts carry market forces?

Fri, 14 Aug 2026 00:00:00 +0100

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Working Load Limit

Can your supply contracts carry market forces?

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The consumer and retail sector has faced relentless strain in recent years. How can in house legal teams ensure supply chain contracts are both robust and flexible enough for their business to thrive in the current - and future - commercial landscape?

Published: 14 August 2026
Authors: Emma Carr

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Over the past five years, few sectors have faced more relentless strain than consumer and retail. Inflation, geopolitical instability, supply chain disruption, cyber-attacks, tariff uncertainty and margin compression have become recurring features of the commercial landscape.

For many businesses, disruption is no longer the exception. It is the operating environment.

For in-house legal teams, that creates a dual challenge: ensuring contracts are prescriptive enough to allocate risk clearly, but flexible enough to allow the parties to adapt to changing market forces.

Those challenges often require different legal perspectives.

In this article, Simon McArdle, a Partner in the Commercial team and co-head of the Consumer and Retail Sector considers what effective supply contracts should achieve, while Emma Carr, a Partner in the Commercial Litigation team, examines how those contracts are tested when commercial relationships come under pressure. Together, they look at some of the contractual provisions that matter most, not just when a deal is negotiated but also when it is put to the test.

Simon: “The best supply agreements aren’t designed to predict every possible disruption; they’re designed to give businesses a practical framework for managing change without renegotiating the relationship every time market conditions shift”

1. Price review clauses: Certainty and flexibility

What the contract should achieve

In a volatile market, pricing mechanisms need to do more than just state the price. They should establish a clear process for dealing with increases in raw materials, freights, energy, tariff or currency costs, identifying what can trigger a review and how negotiations will be conducted if agreement cannot be reached.

When commercial pressure tests the contract

Many disputes do not begin with a refusal to perform. They begin with suppliers issuing revised invoices, seeking temporary surcharges or asking customers to absorb part of an unexpected increase in costs.

Commercial teams quite rightly focus on keeping product moving. Temporary arrangements are agreed, payment terms are relaced and pricing concessions made.

Those decisions are often commercially sensible. The difficulty however is that unless they are carefully documented, they may later become the subject of disputes about contractual variation, waiver or estoppel.

Emma: “The difficult cases are rarely those where the contract has been followed, they’re the ones where sensible commercial decisions were made under pressure, but nobody stopped to consider how those decisions might be interpreted if the relationship later broke down”

Risk management

Commercial concessions may often be the right answer, however the risk is allowing them to evolve without recording exactly what has been agreed and on what basis. Temporary pricing arrangements should identify their duration, who approved them and whether both parties intend to preserve their underlying rights.

2. Force majeure: The clause is only the starting point

What the contract should achieve

Force majeure provisions should identify the relevant events, prescribe notice requirements, allocate responsibility for mitigation and explain what happens if disruption continues beyond a specified period. Under English law, force majeure is contractual rather than statutory; the wording therefore matters.

When commercial pressure tests the contract

Whether disruption falls within the clause is only the beginning. The debate quickly mores to whether notice was given on time, whether reasonable mitigation steps were taken and whether performance was genuinely prevented, rather than simply made more difficult or expensive.

These issues are often determined as much by contemporaneous evidence as the wording of the clause itself.

Risk management

Operational teams should be primed to anticipate when legal input is needed. A missed notice or poor record of mitigation can undermine an otherwise strong contractual position before any formal dispute has begun.

3. Termination rights: Commercial urgency and legal entitlement

What the contract should achieve

Termination provisions should distinguish clearly between material breach, persistent breach, insolvency and termination for convenience, while setting out the procedural steps required before the agreement can be brought to an end.

When commercial pressure tests the contract

When a supplier cannot perform, procurement teams understandably want certainty and alternative supply. The legal risk is different. Some of the most protracted disputes arise because a party terminates before the contractual or common law right to do so has arisen.

Emma: “Some of the most expensive supply chain disputes we see aren’t caused by the original breach. They’re caused by the otherwise innocent party terminating before it was legally entitled to do so”

Risk management

Before issuing a termination notice, ask whether the business is exercising a specific contractual right or simply reacting to commercial frustration. The distinction may well determine who ultimately becomes claimant and who becomes defendant (or receives a counterclaim).

4. Limitation of liability: Understanding the real value of the dispute

What the contract should achieve

Liability caps and exclusions should reflect the commercial allocation of risk agreed by the parties and should be tested against realistic disruption scenarios, not just negotiated in the abstract.

When commercial pressure tests the contract

The question is often not whether there has been a breach but whether the losses that matter commercially are recoverable (either at all, or up to a capped amount).

Emergency procurement costs, production downtime, retailer penalties and lost profits may all arise from the same disruption. Whether they can be recovered depends on the contractual allocation of risk. That in turn will shape litigation strategy, settlement discussions and the commercial value of the claim.

Risk management

Review limitation and exclusion clauses at an early stage, considering how they would be interpreted by the Courts if tested, how they operate in practice, and whether statutory restrictions¹ might be engaged. These clauses often – assuming they are enforceable - determine the commercial value of pursuing a claim long before proceedings are contemplated.

5. Change control: Today’s solution can become tomorrow’s dispute

What the contract should achieve

Supply agreements should contain clear, practical mechanisms for agreeing changes to specifications, delivery schedules, volumes or substitution arrangements as commercial circumstances evolve.

When commercial pressure tests the contract

Periods of disruption often require pragmatic solutions. Alternative products are supplied, delivery schedules change and operational teams reach sensible commercial compromises.

Problems arise where those changes are never formally documented. Once relationships deteriorate, parties may fundamentally disagree about which version of the agreement governs their obligations.

Risk management

Ask a simple question. If this relationship ended tomorrow, could someone unfamiliar with it understand why the parties have departed from the contract? If not, document the current position and how the parties got there.

6. Notice provisions: Small details with significant consequences

What the contract should achieve

Notice provisions create certainty around price reviews, claims, termination and force majeure.

When commercial pressure tests the contract

Notice provisions are often the easiest contractual requirements to overlook. However, failure to adhere to their terms can scupper the execution of an otherwise legally and commercially sound response to a challenging situation.

By the time lawyers become involved, opportunities to preserve important contractual rights may already have been lost.

Risk management

Ensure procurement and operational teams know which contractual issues require immediate legal escalation.

7. Evidence: The contract is only half of the story

What the contract should achieve

Well-drafted contracts remain essential, but disputes are rarely won on contractual wording alone.

When commercial pressure tests the contract

Internal emails explaining why a commercial decision was taken, records of mitigation supplier performance data and correspondence with customers frequently become the documents that determine the outcome of a dispute.

Emma: “By the time external lawyers are instructed, the most important evidence has usually already been created, the question is whether it has been preserved and whether the business’s communications support the position it ultimately wants to take.”

Risk management

Document presentation should begin when a significant contractual issue emerges, not just when proceedings are threatened. Encourage disciplined communications and involving legal early enough to preserve privilege where appropriate.

Looking ahead

Supply chain disruption is unlikely to disappear. Whether driven by geopolitical events, energy market turbulence, cyber incidents or continuing economic uncertainty, commercial pressure will continue to test long-term contractual relationships.

For in-house legal teams, effective risk management therefore has two stages.

The first is ensuring that contracts allocate foreseeable risks clearly and provide practical mechanisms for managing change.

The second is equipping operational teams to recognise when a commercial issue is becoming a legal one. At that point, the quality of the business’s response often becomes just as important as the quality of the drafting.

As Simon observes:

“A good contract gives the business options when circumstances change”

Emma’s experience is that what happens next is equally important: “It is rarely the wording of the contract alone that determines the outcome of a dispute. More often, it’s how the parties exercised those contractual options once the relationship came under pressure”

For in house legal teams, that is where commercial drafting and dispute management meet. The objective is not simply to have a well drafted contract, but to ensure that when commercial reality requires the business to depart from it, those departures are managed in a way that preserves both the commercial relationship and the business’s legal position.

¹ In particular the Unfair Contract Terms Act 1977

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Payment Innovators Network podcast by Shoosmiths: Ep1 with Richard Ambrose

Thu, 13 Aug 2026 00:00:00 +0100

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Podcast | 18 min listen

Payment Innovators Network podcast by Shoosmiths

Episode 1 with Richard Ambrose

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Rich Ambrose CEO of Wealthify is our guest on the Payment Innovators Network Podcast. Richard shares his background in the payments industry and his journey from eBay to Wealthify.

Published: 13 August 2026
Author: Thomas Brown & Richard Ambrose, CEO, Wealthify

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The impact of employment reform on workforce planning

Wed, 12 Aug 2026 00:00:00 +0100

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The impact of employment reform on workforce planning

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Our fourth article in association with the CIPD, Future-focused HR, discusses workforce planning and forecasting, exploring why this is more important than ever. Here, we consider the legal risks when workforce planning goes awry.

Published: 12 August 2026
Authors: Antonia Blackwell

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What is workforce planning?

Workforce planning is a critical tool for ensuring businesses have the right skills, in the right roles, at the right time, while minimising legal and employee relations risks. As organisations navigate technological advances, changing market demands and significant employment law reforms, workforce planning is critical to business success.

The consequences of failing to workforce plan

Where employers focus solely on filling current vacancies without considering the skills their organisation will need in the future, they increase the risk of recruiting individuals whose qualifications, experience or capabilities are not aligned with the evolving demands of both the business and the individual role.

If business requirements change and the employee lacks the skills needed to adapt, inevitably capability concerns will arise, leading employers into lengthy performance management processes. In some cases, these processes can successfully support an employee to improve. In others, they result in dismissal where the required standards cannot be achieved. Either outcome can be time-consuming and disruptive for both the organisation and the individual concerned.

Employees who are placed on performance improvement plans may experience increased stress and anxiety, particularly where they feel they were recruited into a role without adequate support or training. This, in turn, can give rise to an increase in grievances if an employee believes they are being treated unfairly or inconsistently. Over time, this can contribute to declining engagement, lower morale and increased employee challenges across the organisation.

The legal risks associated with these situations are likely to become more significant. From January 2027, employees will gain protection from unfair dismissal after only six months' service. This means employers will need to be able to demonstrate not only a potentially fair reason for dismissal, but also that a fair and reasonable process has been followed in respect of any dismissals once six months’ service is reached. With employees potentially obtaining unfair dismissal protection much earlier in their employment, employers may find themselves undertaking extensive and costly processes to address issues that could have been reduced or avoided through more effective workforce forecasting at the outset.

Why is workforce planning so important now?

At the same time, businesses are operating in an environment where workforce requirements continue to change at an unprecedented pace. New technology, shifting customer expectations and evolving business models mean that some roles are transforming rapidly, while others may become less relevant or disappear altogether.

Where roles are no longer required, employers may need to undertake redundancy exercises. Equally, where roles continue to exist, but their responsibilities evolve, changes to terms and conditions of employment, policies or working arrangements may become necessary. Both scenarios involve legal obligations and can present employee relations challenges if not approached carefully.

This is particularly relevant given the employment law reforms that employers will be navigating over the next few months. Changes due to come into force under the Employment Rights Act 2025 will significantly restrict the circumstances in which employers can rely on so-called "fire and rehire" practices where employees do not agree to contractual changes. As a result, organisations will need to engage in more meaningful consultation and explore alternatives well before workforce changes become urgent. Early planning provides employers with flexibility and time needed to identify potential issues and engage constructively with employees. The hope is that change can then be implemented with the agreement of all concerned.

Similarly, reforms expected in 2027 will broaden the circumstances in which collective consultation obligations arise during redundancy exercises. Employers proposing 20 or more redundancies either at one establishment or redundancies, at a level yet to be confirmed, across multiple sites, within a 90-day period may be required to undertake collective consultation with trade unions or employee representatives. This change will mean that collective consultation is likely to be triggered more frequently than under the current law. Employers who understand their future workforce requirements well in advance will be better positioned to identify when these obligations may arise and if so, ensure legal compliance.

What role can regular training and development play in workforce planning?

Effective workforce planning is also about investing in the workforce that already exists.

The growing use of artificial intelligence provides a clear example. Many organisations are introducing AI-driven tools to improve efficiency and support decision-making. Yet successful implementation requires more than simply deploying new technology. Employees need training to understand how these systems interact with their roles, how to use them effectively and how to recognise and manage associated risks. Businesses that proactively identify future capability requirements can develop training programmes that equip employees to adapt to technological change rather than be left behind by it.

Key recommendations

identify future skills requirements and build these into current recruitment processes as well as training programmes
ensure employees are supported and given regular feedback, particularly during the first few months of employment and address any concerns early on
plan for any organisational design changes early and factor in changing legal requirements

Conclusion

By forecasting future capability requirements, businesses can make more informed decisions about recruitment, training, restructuring and organisational changes. This enables businesses to respond to changing circumstances in a strategic way, rather than reacting under pressure once problems have emerged.

For more insights from the CIPD’s Future focused thought leadership series supported by Shoosmiths, sign up here: Future-focused HR

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Court of Appeal considers case management of ‘omnibus’ claims

Tue, 11 Aug 2026 00:00:00 +0100

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Court of Appeal considers case management of ‘omnibus’ claims

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Judgment holds that c5,000 motor finance claims against various defendants meet the 'convenience' test in CPR r.7.3.

Published: 11 August 2026
Authors: Mahesh Vara & Claire Kershaw

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The Court of Appeal has dismissed an appeal by various lender Defendants against a High Court decision permitting c5,000 motor finance claims to proceed by way of multi-party ‘omnibus’ claim forms. While this is a case management decision specific to its facts, it will nonetheless be of interest to parties engaged in similar disputes.

Background

The Claimants all purchased motor vehicles with the assistance of finance provided by the Defendants. The Claimants claim repayment of monies paid by them under relevant credit agreements on the basis they gave rise to an unfair relationship within the meaning of s.140A of the Consumer Credit Act 1974 (the Act) due to alleged undisclosed commissions paid by the Defendants to the relevant car dealers.

The claims were issued in the County Court in 2022 by way of 8 Claim Forms, grouping the claims against each of the Defendants. Generic Particulars of Claim were served pleading the overarching allegation that the Defendants’ failure to disclose commission agreements between them and the car dealers was a breach of the Financial Conduct Authority’s Consumer Credit Sourcebook and meant that every relationship between the Claimants and Defendants was unfair.

The Defendants sought to disaggregate the claims, arguing that determination of an unfair relationship was entirely fact specific.

At first instance the County Court agreed, finding that the convenience test under CPR r.7.3 had not been met. Following the Divisional Court’s judgment in Abbott¹, the circuit judge concluded he was not satisfied that “there were common issues of sufficient significance that their determination would constitute real progress towards the final determination of each claim in a set of claims”.

The Claimants appealed. However, before the appeal hearing had taken place, the Court of Appeal handed down judgment in Morris² an unrelated professional negligence case in which the use of an omnibus claim form was also being challenged. In Morris, the Court of Appeal concluded the test set out in Abbott was too restrictive. While the factors identified in Abbott may be relevant to the question of convenience under r.7.3, they should not operate as exclusionary rules. What is ‘convenient’ is a matter for the Court’s discretion according to the facts of the case.

Morris was plainly going to influence the High Court’s approach in these the present proceedings, and so it did. The High Court judge essentially concluded that, since Abbott had been overturned by Morris, the approach taken by the circuit judge could not stand, and that he was entitled to re-exercise his discretion on the question of convenience. He identified³ 9 separate factors to consider, and on analysis found that the vast majority supported the convenience test having been met. He therefore allowed the appeal and gave directions for the Defendants to serve generic Defences, and to provide certain disclosure.

The Defendants sought permission to appeal on 4 grounds. Permission was granted on the fourth only, namely (in short) that the Judge had failed to re-exercise the discretion properly.

Court of Appeal decision

The Court of Appeal (unanimously) dismissed the appeal.

The judgment addresses 5 different aspects of the Judge’s exercise of discretion. The key points can be summarised as follows:

Unfairness

there was some criticism of the Judge’s approach insofar as he identified, as part of the common issues exercise, cases where (in his view) there was “a very clear case of unfairness”. This went against numerous authorities, including Johnson⁴, establishing that unfairness is an entirely fact-specific inquiry. This point did not, however, go to the heart of the Judge’s judgment.

Common issues

the Court reaffirmed that “[c]ommonality of issue is different to whether the result of an issue will be binding on everyone”. Claims which are very similar in nature are likely to give rise to common issues of law and fact, even if they require separate evaluation “in the final act”.
while the Court was sceptical as to the utility of the two “broad common issues” identified by the Judge, it could not say that he was wrong, in the exercise of his discretion, to conclude that there were some common issues and that that was relevant to the question of convenience.

Lead cases

the Court rejected the submission that it wasn’t enough for results in lead cases to be persuasive - as opposed to binding - to point towards convenience. The Court considered that even where claims are fact-sensitive, it would be surprisingly uncommercial and contrary to common sense not to extrapolate the results as part of considering remaining claims.
the Court agreed with the Judge that trial of lead cases would plainly be a sensible step and a “clear pointer” towards convenience. Disclosure of the brokerage agreements, as ordered by the Judge, would assist in identifying lead cases through the usual method.

Remedy

the Court rejected the criticism that the Judge had failed to consider remedy in his reasoning, observing that questions of remedy always turn on the individual facts of each case, but this was “manifestly not a reason to find that the convenience test under r.7.3 had not been made out”.

The case management directions

while the Court was doubtful that the provision of generic Defences would particularly progress matters, it could not say that the Judge was wrong to require them; it was consistent with the view he had formed about common issues and it would be more cost effective than pleading +5,000 Defences individually
as for the disclosure required from the Defendants, the Court recognised the burden this placed on them, but noted it was an inevitable part of responding to these claims (however formulated), rather than a function of the Judge’s order. The documents were necessary for the inquiry into unfairness which the Defendants urged be undertaken

Key takeaways

Due to the limited scope of the appeal (on one ground only, against a case management decision), “the result cannot easily be extrapolated into setting out any new or wider principles to be followed” in other cases on the question of convenience.

It can nonetheless be added to the growing list of authorities (going in various directions) from which parties on all sides may seek to draw analogies and/or distinctions as against their facts. It clearly illustrates the generous ambit of the courts’ discretion in relation to case management and confirms, subject to any contrary finding by the Supreme Court, that even cases involving highly fact-sensitive matters such as the assessment of unfairness under the 1974 Act are not inherently unsuitable for omnibus proceedings.

The Court did however note that the effect on court resources is relevant to the question of convenience and suggested data including lost fee revenue be compiled by HMCTS. It also gave a clear nod to the Civil Procedure Rules Committee to revisit its post-Morris decision⁵ that no amendment of either r.7.3 or r.19.1 was needed. This may potentially form part of a wider review of Part 19 which the CPRC has previously indicated would be added to its future work programme. It is also worth noting the Law Commission’s consideration of a potential new consumer class actions regime.

One thing is for certain: potential parties to large group claims should expect plenty of further developments as to how such claims should be managed.

¹ Abbott v Ministry of Defence [2022] EWHC 1807 (KB)
² Morris & Others v Williams & Co Solicitors [2024] EWCA Civ 376
³ At paragraph 89
⁴ Hopcraft and another v Close Brothers Ltd; Johnson v FirstRand Bank Ltd (London Branch) (t/a MotoNovo Finance); Wrench v FirstRand Bank Ltd; (London Branch) (t/a MotoNovo Finance) (Rev1) [2025] UKSC 33 (01 August 2025)
⁵ Recorded in the minutes of its meeting on 5 July 2024

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New tech, old law (part 2): UKJT confirms its position on liability for AI harm

Tue, 11 Aug 2026 00:00:00 +0100

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New tech, old law (part 2)

UKJT confirms its position on liability for AI harm

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What's new in the UKJT's final legal statement on civil liability for AI harm, and what does this mean for businesses in the supply chain and/or as end users?

Published: 11 August 2026
Authors: Alex Bishop, Peter Richards-Gaskin, Alex Kirkhope, Sarah Reynolds, Claire Kershaw & Stefanie Hughes

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The UK Jurisdiction Taskforce (UKJT) has published its final legal statement on liability for AI harm, following consultation on its draft legal statement published earlier this year. While the UKJT’s core conclusions (as discussed in our previous article) remain largely unchanged, the final statement incorporates some further analysis in certain areas. This article focusses on those developments and the key takeaways for businesses, both in the AI supply chain and as end users.

Summary of key updates

Vicarious liability and non-delegable duties

the final statement discusses a further important aspect of potential liability for harm caused by another, namely where there is a non-delegable duty to protect against that harm¹. Giving the example of an NHS Trust procuring an AI diagnostic tool from a third-party developer, the statement notes the Trust would not be able to avoid liability for any harm caused to a patient as a result of a defect in the tool by arguing the defect was the developer’s fault. The Trust would, however, likely consider seeking a contribution from the developer under the Civil Liability (Contribution) Act 1978 – subject to the usual analysis on causation, contributory negligence and so on.

Factual causation and material contribution to damage

the final statement also includes a new discussion around the principle of ‘material contribution to damage’ – to date predominantly applied in cases involving industrial disease and clinical negligence, but arguably of general application. The principle essentially fills a gap left where, through multiple wrongdoers, harm was caused, but on a strict ‘but for’ analysis no single wrongdoer’s act or omission caused the harm. An example is given of two waste plants, one using human employees only and the other an AI system, negligently discharging equal amounts of waste into a river which together take the pollution level above a particular threshold.

Contributory negligence

the potential impact of contributory negligence was not addressed in the draft statement – the final statement now considers how such arguments may play part of the assessment of liability for harm caused by AI. The statement does not suggest that any particular new principles or analysis need apply, but emphasises that the question will always be highly fact specific, and the nature of the user (commercial or non-commercial) and the level of verification of the AI output will be key themes.

Defamation

the expanded discussion in the final statement emphasises that the extent to which anyone in the AI supply chain may be considered a publisher is highly fact specific. This may be most straightforward to establish in the case of commercial publishers using AI tools to generate content for their website. At the other end of the scale, the UKJT suggests that a Foundation Model Developer, with no involvement in publication of a statement beyond having licensed the use of their model, may potentially be deemed a publisher of a defamatory statement generated by it - if they have sufficient practical ability to prevent further publication.
the final statement also acknowledges that how the defences available under s.1 of the Defamation Act 1996 and s.5 of the Defamation Act 2013 may apply in relation to AI-generated content is unclear. In relation to s.5 of the 2013 Act for example (Operators of websites), the potential defence is predicated on the basis of there being a ‘poster’ of a statement with whom the website operator must seek to correspond, but query whether/who a court would consider to be a ‘poster’ of an AI-generated statement.

What does this mean for businesses?

As noted in our previous article, in most commercial contexts the contractual arrangements between the parties in an AI supply chain will be the most important legal framework governing liability for any harm arising. For businesses operating in this space and their advisers negotiating commercial contracts, meticulous attention to detail must go hand in hand with a thorough understanding of the technology (both as it stands and how it may evolve) as well as its intended/likely deployment downstream.

For businesses as end users of AI tools the key points to note include:

generally speaking, an organisation could not be held vicariously liable for harm caused by an AI tool it is using since the tool itself, in the absence of its own legal personality, could not be held primarily liable. An organisation could however be held vicariously liable for wrongdoing, such as negligence, by an employee in connection with their use of an AI tool. Moreover, an organisation using an AI tool in the performance of a non-delegable duty could not avoid primary liability to anyone harmed as a result of a defect in the AI tool, but could seek to recoup (at least partially) any such liability incurred by way of a contribution claim against the tool developer (subject of course to the usual analysis and any contractual arrangements preventing or limiting their ability to do so).
more particularly, organisations using chatbots may potentially be liable for false statements made by it if the chatbot is held out as communicating on the organisation’s behalf, if there is an express or implied representation that the chatbot’s output is accurate, and/or if the chatbot makes a defamatory statement. Such organisations should make clear to users that the chatbot is AI-powered, that its output may be inaccurate/contain hallucinations, and that any views expressed do not represent those of the organisation. Those organisations in scope of the EU AI Act are likely to be familiar with these types of requirements, given their alignment with the Act’s transparency obligations.
for professional services firms, consideration of whether, when and how to deploy AI tools must form part of their ongoing assessment, exercising reasonable care and skill, of how to carry out their client’s instructions. While any guidance from relevant regulators and professional bodies will be instructive in this respect, given the implications for their own liability, amongst other good reasons, professionals must exercise their own judgment in the context of the particular matter and their client’s objectives. In some scenarios, a client may prefer to forego a potential benefit of using AI in order to avoid a potential risk. The critical foundational step is to identify and explain competently the potential options and the risks and benefits of each.

¹ Such duties are rare and their defining features were articulated by the Supreme Court in Woodland v Essex County Council [2013] UKSC 66 (23 October 2013) at paragraph [23]. In short where it is established that Party A owes a non-delegable duty of care to Party B and outsources an integral part of its functions to Party C, if Party B suffers harm as a result of Party C’s negligence in the performance of that particular function, Party A will still be liable to Party B. Non-delegable duties may arise for example in the context of prisons, care homes and schools.

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Peppa Pig is granted an international injunction

Tue, 11 Aug 2026 00:00:00 +0100

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Brand interchange | 4 min read

Peppa Pig is granted an international injunction

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Decision: Hasbro Consumer Products v Công ty TNHH & Ors
Court: High Court (Intellectual Property List)
Judge: Mr Justice Richard Smith
Citation: [2026] EWHC 1957 (Ch)
Decision: Here
Key issues: Injunctions

Published: 11 August 2026
Authors: Eloise Ryan

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Introduction

In Hasbro Consumer Products v Công ty TNHH & Ors, the English High Court has granted an (unusual) worldwide injunction in relation to aspects of Wolfoo, a popular preschool YouTube series.

Wolfoo was launched in 2018 and now has over 20 million subscriptions across its three major channels. It follows a young wolf, who lives with his family and friends, with episodes exploring everyday situations, adventures and games with Wolfoo.

In 2022 the makers of Peppa Pig brought infringement proceedings in the English courts, alleging, among other things:

in the UK, copyright infringement, trade mark infringement and passing off
in the EU, copyright infringement and trade mark infringement
in jurisdictions subject to various international copyright conventions and treaties (such as the Rome Convention, TRIPS and WPPT), copyright infringement

The sound recording copyright claim

In June this year, the court granted summary judgment on a discrete aspect of the wider proceedings.

Here, the Claimants alleged that audio clips from Peppa Pig had been copied in Wolfoo, resulting in infringement of copyright in the sound recordings. To support their case, the Claimants relied on detailed technical evidence, using spectrogram analysis in respect of Peppa Pig videos and a representative sample of Wolfoo videos, showing identity.

In turn, the Defendants sought to raise doubts such as the identity, authorship and ownership of the copyright works, but failed to substantively challenge the evidence advanced by the Claimants.

The issue fell before Mr Justice Richard Smith, who concluded that the Defendants had no realistic prospect of successfully defending this aspect of the claim, giving summary judgment.

International copyright claims and the presumption of similarity

The question arose as to whether the finding of copyright infringement under English law may apply to other jurisdictions and, if so, whether an injunction should be granted.

The Defendants argued that copyright is territorial in nature and that the Claimants could not simply rely upon English copyright law when alleging infringement across numerous jurisdictions.

Having examined the "default rule" and the "presumption of similarity" in private international law, the Court explained that, where foreign law is pleaded and properly engaged, English law may nevertheless play a role if it is reasonable to assume that the foreign law is materially similar to English law such that it is unlikely to lead to a different substantive outcome.

The Claimants argued that this test was satisfied in relation to EU jurisdictions because UK copyright law historically developed in line with the Information Society Directive. In relation to other countries, they relied on the harmonising effect of international copyright instruments including the Rome Convention, TRIPS and the WIPO Performances and Phonograms Treaty (WPPT).

The Court accepted those arguments and found that the Defendants had failed to identify any material differences between English law and the laws of the relevant foreign jurisdictions. In particularly forceful terms, the judge stated that it was not enough for the Defendants merely to assert a "bald belief" that material differences might exist and that further investigation would reveal them.

Representative sampling and large-scale online infringement

Another question arose as to whether the Defendants should obtain relief only in relation to the representative sample of Wolfoo video on which it relied, or all of them (which exceed some 30,000 videos).

The Court accepted evidence that the sampled videos were genuinely representative of the wider corpus, and that analysing every Wolfoo video would have been wholly disproportionate. As a result, the Court was prepared to infer that further infringements would likely be identified if wider analysis were undertaken.

Injunction

The practical consequence of this was a remarkably broad injunction. The Court ordered the removal of all Wolfoo videos falling within the scope of the findings in all jurisdictions that are parties to the relevant international copyright conventions and treaties (rather than limiting relief to specific videos or specific jurisdictions).

Key takeaways

The key takeaways from the decision are that:

in certain circumstances, the English courts are open for business to grant pan-jurisdictional injunctions in copyright disputes, which may serve as a cost-effective way of resolving international disputes
the presumption of similarity remains a powerful procedural tool where Defendants fail to identify concrete differences between English law and applicable foreign laws
courts may be willing to accept representative sampling as evidence of infringement across large bodies of online content where full analysis would be disproportionate
international copyright treaties and harmonised copyright frameworks can provide strong support for cross-border enforcement strategies

Caveat

While the judgment is a buoy to copyright holders looking to enforce their rights globally and cost effectively, a note of caution:

the success masks a prolonged (some four years to date) and ongoing dispute, with the court already having wrestled with pleading disputes and jurisdictional challenges
sound recordings carry no originality threshold and the infringement was clear, meaning it was harder for the Defendants to point to any material difference between English law and other jurisdictions. This may not apply to other copyright claims
the Defendants did not always attend the hearings and were not always legally represented
this is a first instance decision

Introducing Brand Interchange

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Shoosmiths strengthens Banking & Finance practice with partner hire in Manchester

Mon, 10 Aug 2026 00:00:00 +0100

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Shoosmiths strengthens Banking & Finance practice with partner hire

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Shoosmiths has appointed Alastair Carruthers as a Partner in its Banking & Finance team in Manchester, strengthening its asset-based lending capability in the North West and across the UK.

Published: 10 August 2026

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Joining from DLA Piper, Alastair’s practice focuses on asset-based lending. He brings experience advising on cross-border financing transactions, receivables financing and other forms of asset-based lending, with particular expertise across complex upper mid-market transactions.

His clients include clearing banks with asset-based lending platforms, independent and alternative lenders, private credit and fund-backed lenders, sponsors, corporates, and mid- and upper mid-market borrowers, including across asset intensive sectors such as manufacturing, logistics and mobility.

Jon Bew, Partner and Head of Asset Based Lending at Shoosmiths, said: "Asset based lending is a growing and increasingly sophisticated area of the finance market, and Alastair’s addition strengthens our capabilities to support clients across the UK and internationally on complex matters. His deep specialist expertise and strong, well-established network are significant assets to our team, complementing our existing offering and enhancing our capacity to advise on complex multi‑asset and cross‑border mandates as we continue to make progress against our 2030 growth strategy. We are thrilled to welcome him to Shoosmiths.”

Alastair is widely regarded in his field, with both the Legal 500 and Chambers UK widely recognising him, with Legal 500 confirming him as a ‘Rising Star’ for both Asset Based Lending and North West Banking and Finance.

Commenting on his appointment, Alastair said: "Shoosmiths has a clear and ambitious vision for its Banking & Finance practice, and the firm's commitment to building out a market-leading offering in the upper mid-market was immediately compelling. The opportunity to build on the growing demand for asset based lending in the North West and nationally, combined with the strength of the firm's broader platform across Corporate and Restructuring and Advisory, made this an exciting prospect. I look forward to working with colleagues across the firm to build on the strong foundations already in place."

Alastair's appointment reflects Shoosmiths' continued investment in its Banking & Finance practice, one of the firm's core growth platforms under its 2030 strategy and follows the addition of E&I specialist partner Graham Knight and promotion of leveraged finance partner Charlotte Thomas.

The Shoosmiths Manchester Banking & Finance team has expertise across the core disciplines of real estate finance, leveraged and corporate lending and asset-based lending, it also brings the team up to 13 strong, making it one of the largest teams in the North West.

Shoosmiths’ Banking & Finance team advises borrowers, lenders and investors on corporate, real estate, leveraged and acquisition finance, asset-based lending, energy and infrastructure finance and sector-specific transactions. Working across the UK and industries such as energy, infrastructure, mobility, logistics and retail, the team supports clients through growth, acquisitions, restructurings and working capital solutions.

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Duty of fair presentation in action: Insurer avoids policy after non-disclosure

Thu, 6 Aug 2026 00:00:00 +0100

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Duty of fair presentation in action

Insurer avoids policy after non-disclosure

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The Commercial Court has held that an insurer was entitled to avoid a charterer's liability policy after the insured failed to disclose a number of fires involving its cargo.

Published: 6 August 2026
Authors: Susie Wakefield

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The recent Commercial Court decision in Cometsambre SA v Lloyd's Insurance Company SA HIG 5321 provides a compelling illustration of the courts’ approach to assessing whether an insured has complied with its duty of fair presentation under s.3 of the Insurance Act 2015 (the Act), and the consequences of failing to do so.

Background

The dispute relates to a Charterer’s Liability (C/L) insurance policy underwritten by AMICA, as coverholder for the Defendant (Lloyd’s), in favour of the insured Claimant (Cometsambre), a scrap metal dealer.

Lloyd's Insurance Company SA writes European risks for Lloyd’s syndicates; the policies are then 100% reinsured by Lloyd’s syndicates, in this case Hartford's Syndicate 1221.

Cometsambre first approached AMICA through a broker in 2008 seeking C/L insurance in respect of the planned shipping of scrap from its base in Ghent, Belgium. Through various exchanges, AMICA was informed that the scrap would be non-oily, non-radioactive, non-dangerous shredded steel scrap, excluding motor blocks, borings and turnings, to HMS 1 / HMS 1+2 or ISRI specifications.

Between 2010 and 2022 cover was renewed every year on almost identical terms with little correspondence. One small claim was made in 2012 in respect of stevedore damage, and in April 2021 Cometsambre gave notice of a potential claim against it in respect of a grounding at Alexandria.

In June 2022 a cargo of Cometsambre’s scrap metal was involved in a fire on board the chartered vessel LOWLANDS MIMOSA, resulting in a claim against Cometsambre under the charterparty. AMICA were subsequently informed of various other fires involving Cometsambre’s scrap; 10 in total between 2014 and 2022, either quayside or once loaded onto vessels, with 5 of these taking place between May 2020 and October 2021.

Lloyd’s declined to cover Cometsambre in respect of the LOWLANDS MIMOSA charterparty claim on the basis that Cometsambre had breached its duty of fair presentation both in terms of (i) the nature of the scrap being shipped and (ii) the failure to disclose the 5 fires between May 2020 and October 2021.

Cometsambre issued proceedings in December 2024 seeking a declaration that Lloyd’s was obliged to indemnify it in respect of its costs of dealing with the charterparty claim and, to the extent necessary, for any substantive liability incurred in that respect.

Commercial Court judgment

The Court (Mr Justice Butcher) dismissed the claim, finding that Lloyd’s was entitled to avoid the 2022 policy.

On the key issues the Court found as follows:

Materiality

Cometsambre sought to argue that the fire record was not ‘material’ for the purposes of s.3(4) of the Act since:

none of the fires had given rise to a claim against Cometsambre (in particular, none of the vessel fires had led to a claim by the owners and were therefore not material to a C/L underwriter)
the quayside fires were not material to a C/L underwriter because any resulting claim would be on Cometsambre’s property insurance policy.

The Court rejected these arguments, preferring Lloyd’s underwriting expert’s evidence that fires were “a paradigm example of an incident capable of giving rise to a claim” which must be disclosed, even if a claim did not materialise. In particular, the fact that five fires occurred in the 18 months between May 2020 and October 2021 was significant as it indicated a change in the risk profile.

Insurers on notice

Cometsambre argued that since AMICA was aware of the nature of the cargo it should have been aware of the general risks of the business, and had not asked for an updated questionnaire on renewal each year, AMICA was on notice, for the purposes of s.3(4)(b) of the Act, that it needed to make further enquiries.

The Court regarded this as an improper attempt to reverse the burden of ensuring fair presentation of risk; that obligation lies primarily with the insured. Nothing AMICA was told could be said to have put AMICA on notice of the change in the incidence of fires over the relevant period, in particular the five fires in c. 18 months prior to the 2022 renewal. Even if (which the Court did not consider necessary in any event) AMICA failed to insist on loading surveys being performed as a matter of course, this would not excuse Cometsambre from disclosing the fires it had actual knowledge of.

Insurers’ presumed knowledge

It was also argued that underwriters could be presumed to know, for the purposes of s.3(5)(d) of the Act, that fires of this nature would probably have occurred.

Again, the Court was not persuaded, finding that Cometsambre failed to establish presumed knowledge of the relevant fires, still less that they had occurred in such quick succession after a long period of none at all, which suggested “a change in the risk profile”.

Disclosure waived

Cometsambre further submitted that the fact it was not asked to fill in an updated questionnaire or to provide further information about risk management, losses, incidents, claims and so on over the years meant a reasonable insured would understand AMICA was “only concerned with Cometsambre’s claim history and were indifferent about fires not giving rise to a claim”.

The Court disagreed. AMICA’s enquiries at the outset of the relationship were designed to ensure that fire-risky cargo was not being covered. The fact the initial questionnaire – prepared by the broker rather than by AMICA – only requested information about Cometsambre’s ‘claims record’ could not reasonably be understood as indicating that underwriters were not interested in any fires which had not given rise to a claim. Neither the absence of renewal questionnaires in subsequent years, nor the dealings between the parties in the round, reasonably be understood to amount to a waiver of disclosure of material circumstances.

Inducement

The Court stressed the need to be circumspect about evidence provided by underwriters on whether they would have declined the risk. The Court’s have recognised that there is an inherent risk that, whilst truthful, such evidence may be incorrect as it may be influenced by the fact that the loss has arisen and the witness is asked to consider what they would have done with the benefit of that knowledge.

Despite that the Court accepted the underwriter’s evidence that disclosure of the fires would have caused him to decline to renew. Key factors included the low premium, the expense of sending an expert to investigate each incident, the risk any single fire claim could result in substantial exposure, and the change in risk profile evidenced by the increase in fires.

Accordingly, and having already tendered a return of the premium, Lloyd’s was entitled to avoid the policy under paragraph 4 of Schedule 1 to the Act.

Comment

There are still relatively few judgments addressing insurers’ rights to avoid a policy for a failure to give a fair presentation of the risk under the Act.

Whilst the judgment largely turns on the facts of the case, it is a helpful guide to see how the Court will approach the detail of the analysis required under Act, and the various elements that must be established by insurers. On the facts before the Court, the judgment:

adopts a holistic approach to materiality, not limited to actual or potential claims against the specific policy, and extending to anything affecting the “overall picture of the risk”
reinforces that while the Act makes provision for insurers to be on notice or to have presumed knowledge in certain circumstances, this does negate an insured’s primary obligation to disclose material circumstances of which it has the requisite knowledge
rejects the idea that a ‘failure’ by insurers to specifically to seek out detailed information upon renewal could reasonably be understood as meaning the insurer is indifferent about being informed of material circumstances.

Notwithstanding the outcome in this case, the judgment and its underlying facts also serve as a reminder to insurers and insureds alike of the importance of ongoing meaningful risk assessment and clear forthright communication in reducing the risk of claims and coverage disputes arising in the first instance.

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Ep 12: Lights, Camera, Privacy! The Wolf of Wall Street

Thu, 6 Aug 2026 00:00:00 +0100

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Podcast | 10 min listen

Ep 12: Lights, Camera, Privacy!

The Wolf of Wall Street

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A podcast series that explores privacy themes within some of the most well-known movies.

Whether you are a film buff, a privacy advocate, or simply curious about the intersection of storytelling and privacy, tune in to explore how the big screen tackles privacy.

In this episode, William Moore is joined by Hannah-Mei Grisley to explore the movie ‘The Wolf of Wall Street’. We discuss what might have happened if the employee who infamously lost his job over a goldfish had submitted a data subject access request (DSAR). We cover what a DSAR is and how to submit one, whether Stratton Oakmont could lawfully withhold any unsavoury messages, and what the consequences might have been for Jordan Belfort if he attempted to tamper with the DSAR response.

For any feedback, please contact: William.moore@shoosmiths.com.

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Lights, camera, privacy! podcast series

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When is occupation not occupation? Rates mitigation under the spotlight

Thu, 6 Aug 2026 00:00:00 +0100

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article | 6 min read

When is occupation not occupation?

Rates mitigation under the spotlight

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A “box shifting” rates mitigation scheme did not amount to occupation for non-domestic rating purposes where the sole purpose of placing items in the premises was to secure a rates saving.

Published: 6 August 2026
Authors: Sophie Tracey

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The Court of Appeal has allowed the appeal in The Mayor and Commonalty and Citizens of the City of London (CoL) v 48th Street Holdings Limited and Principled Offsite Logistics Limited (POLL), holding that a “box shifting” rates mitigation scheme did not amount to occupation for non-domestic rating purposes where the sole purpose of placing items in the premises was to secure a rates saving. The decision reverses the High Court ruling discussed in our earlier article, Strategic occupation or rates loophole?, which had found the scheme effective.

Legal position

Liability for non-domestic rates arises through occupation under section 43 of the Local Government Finance Act 1988, or ownership of unoccupied property under section 45. Empty property relief is available to the owner for the first three months after premises become unoccupied. At the time the facts in this case arose, a period of occupation of at least six weeks (the “reset period”, now 13 weeks) was required before that relief could be claimed again.

The leading test for rateable occupation, from John Laing & Son Ltd v Assessment Committee for Kingswood Assessment Area, requires: actual occupation; exclusive occupation for the occupier’s purpose; occupation of some value or benefit to the occupier; and occupation that is not too transient. The appeal focused on whether POLL’s occupation provided any real value or benefit.

What happened?

The case concerned empty office units at 2 America Square, EC3. After the initial empty rates relief period expired, POLL took a short lease at a peppercorn rent and simultaneously served a break notice ending the lease after six weeks. During that period it placed boxes in the premises, accepted liability for rates and claimed to be the occupier. Once the lease ended, the boxes were removed and the owner claimed a fresh period of empty property relief. POLL received a share of the resulting rates saving.

It was common ground that the boxes served no business or commercial purpose and were present solely to create occupation for rating purposes. The lease was not a sham; the dispute was whether the arrangement amounted to occupation to constitute a reset period.

What did the court decide?

At first instance, the High Court followed R (Principled Offsite Logistics Ltd) v Trafford Council and held that POLL’s scheme was effective. It accepted that the benefit of the occupation was the rates mitigation achieved by the arrangement.

The Court of Appeal disagreed and held that the Trafford Council case was wrongly decided. Relying on the Supreme Court’s reasoning in Rossendale BC v Hurstwood Properties, it emphasised that the empty rates regime is intended to discourage properties being left vacant and encourage productive use.

Applying a purposive interpretation, the Court held that Parliament cannot have intended temporary placement of items in an otherwise empty property to constitute occupation where there is no commercial or business purpose beyond rates mitigation. The Court described the arrangement as “pure rate mitigation occupation”.

The Court rejected the argument that the rates saving itself supplied the necessary benefit. That reasoning was circular. While storage can amount to occupation where the stored items have utility to the occupier, occupation must have some independent use, value or benefit. Activity undertaken solely to obtain a rates saving cannot satisfy that requirement.

The Court stressed this was not a motive test. Occupation may still qualify even where reducing rates is one objective, provided the occupation has genuine utility beyond the tax advantage. The difficulty for POLL was that the alleged benefit was the rates saving itself.

What next?

The judgment is a significant setback for intermittent occupation schemes that rely on minimal activity with no independent purpose. Owners, occupiers and advisers should review existing arrangements and consider whether the occupation has genuine commercial or practical utility. Rates mitigation remains possible, but only where occupation has a real use, value or benefit beyond securing a rate saving.

Sophie Tracey, Real Estate Litigation Principal Associate and a rating expert at Shoosmiths, comments: “This decision is likely to signal the end of many rates mitigation schemes based on token occupation. While the Court confirmed that occupation need not be wholly commercial in nature, it must provide a genuine use, value or benefit beyond the rates saving itself. Property owners and occupiers should therefore review existing arrangements carefully, as the courts are increasingly willing to assess such schemes against the underlying purpose of the rating regime.”

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Understanding transition risk in mobility, manufacturing & logistics

Thu, 6 Aug 2026 00:00:00 +0100

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Understanding transition risk in mobility, manufacturing & logistics

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Published: 5 August 2026
Author: Max Finney

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What is climate scenario modelling – and why use it?

Climate scenario modelling is about making better decisions in uncertainty. It helps organisations understand how different policy, market and technology pathways could shape their operations and long‑term strategy. Instead of betting on a single forecast, it tests a range of credible futures—so leadership teams can challenge assumptions, pressure‑test investments and strengthen resilience where it matters most.

This matters because expectations have shifted. Regulators increasingly require organisations to assess and disclose climate‑related risk. But this goes beyond compliance. Investors, regulators and wider society want clear evidence that organisations understand their exposure and are actively building more resilient businesses and supply chains in response.

Our scenario analysis draws on work undertaken by external consultants as part of Shoosmiths’ Transition Risk Assessment and uses the European Sustainability Reporting Standards (ESRS) impacts, risks and opportunities (IRO) framework to identify the sustainability themes most relevant to our key client sectors. The high priority themes were then tested against three future climate pathways from the Climate Change Committee (CCC), reflecting different levels of policy intervention, behavioural change and progress towards net zero.

For each sector, the analysis considered how risks and opportunities could evolve under each scenario, examining implications across areas such as regulation, markets, technology, investment, operations and reputation. This helps to ensure the analysis reflects the sustainability issues most likely to shape future business performance, stakeholder expectations and legal demand. We are therefore able to use the results to turn abstract risk into practical insight that mobility, logistics and manufacturing leaders can act on.

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The three scenarios used

1. Business as Usual (BAU)

No major policy changes beyond current commitments. This represents the slowest pace of decarbonisation and the highest level of sustained climate risk.

2. Moderate Ambition

Some policy progress, but behaviour change and infrastructure deployment lag behind net zero pathways.

3. 1.5°C Aligned (Balanced Pathway)

Policy and behaviour change keep pace with net zero goals. This scenario delivers the most resilient and lowest‑carbon future.

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What are the material transition risks and opportunities for mobility, manufacturing & logistics?

Our scenario analysis highlights several critical impacts of the transition to net zero across markets, technology, policy and consumer dynamics. These evolve over time and present both challenges and opportunities.

Short term (to 2023)

Key risks

climate driven disruption to transport infrastructure: More frequent extreme weather events increase asset degradation, route disruption and maintenance costs across transport networks and logistics systems
slow progress in decarbonising heavy transport and manufacturing: Passenger vehicles electrify faster than heavy goods vehicles and industrial processes, creating uncertainty in fuel pathways and transitional cost pressures
energy price volatility and grid constraints: Electrification increases demand, but insufficient grid capacity and slow deployment of supporting infrastructure creates constraints and uneven regional access
supply chain disruption and critical mineral pressure: Rapid growth in battery technologies and electrification increases competition for critical materials, raising costs and delivery risk
affordability and access challenges for users: High upfront costs of electric vehicles and evolving service models risk excluding smaller businesses and vulnerable communities from access to mobility solutions

Opportunities

investment in electrification and charging infrastructure: Expansion of EV charging networks and electrified fleets creates new market opportunities across logistics and manufacturing
innovation in mobility models: Growth in shared mobility, subscription models and last mile logistics solutions enables more efficient and lower emission transport systems
supply chain transformation: Early adoption of circular material flows and responsible sourcing strengthens resilience and reduces long term cost exposure

Medium term (to 2040)

Key risks

misaligned infrastructure investment: Delays in charging networks, grid expansion and alternative fuel supply chains limit the benefits of electrification and increase transition costs
fragmented technology pathways: Uncertainty between electrification, hydrogen and biofuels for heavy transport and industrial processes complicates long term investment decisions
sustained pressure on logistics systems: Climate disruption, urban congestion and inefficient planning increase complexity and cost in distribution networks
resource and material constraints: Ongoing reliance on virgin materials and limited recycling infrastructure maintains exposure to global supply chain risk

Opportunities

scale up of low carbon manufacturing: Electrification of industrial processes and adoption of circular economy approaches improve efficiency and resilience
development of alternative fuel ecosystems: Growth in hydrogen, synthetic fuels and battery recycling supports diversification of energy pathways
integrated transport and logistics systems: Linking digital systems, energy infrastructure and physical networks enables more efficient and resilient operations

Long term (to 2050)

Key risks

stranded assets in legacy transport and industrial systems: Continued reliance on high emission technologies leads to long term devaluation and transition cost exposure
systemic vulnerability across infrastructure and supply chains: Failure to integrate energy, transport and digital systems reduces resilience to climate and market shocks
persistent resource constraints: Competition for critical minerals, land and water continues to limit growth and increase volatility

Long‑term opportunities

fully decarbonised transport and manufacturing systems: Stable energy supply and mature technologies reduce operating costs and enhance predictability
circular and resilient supply chains: Reuse, recycling and alternative materials reduce reliance on primary resource extraction
leadership in next generation mobility and logistics: Organisations aligned to net zero pathways are best placed to capture long term market value

How risks and opportunities vary across the three climate scenarios

THEME

BUSINESS AS USUAL

MODERATE AMBITION

1.5°C ALIGNED

Transport systems

Transport networks remain vulnerable to storms and heatwaves, making some routes increasingly impractical or too costly to maintain over time.

Mobility and logistics operators see higher disruption exposure and more frequent disputes around performance, force majeure and service levels in haulage and distribution contracts.

Resilience improves in places, but uneven planning and a fragmented system keeps reliability patchy across regions and corridors.

Heavy transport fleets and manufacturers with just-in-time logistics face higher contractual complexity as they manage variable network performance, delivery penalties and route contingency planning.

Integrated resilience planning reduces the risk of redundant infrastructure and supports more reliable movement of goods and people.

Logistics and mobility clients gain clearer line of sight for long-term investment, with stronger foundations for planning, consenting and infrastructure delivery timetables.

Energy & fuel pathways

Limited innovation and slow scale-up of alternatives keeps market uncertainty high for diesel and petrol replacements, with heavy road transport particularly exposed.

HGV decarbonisation programmes become more legally and commercially fraught, as OEMs and operators negotiate technology risk, charging and refuelling access, warranties, total cost of ownership models and evolving compliance requirements.

Electrification progresses but a fragmented mix of EV and combustion vehicles sustains higher costs and weak economies of scale across fleets and supply chains.

OEMs and fleet operators face greater regulatory and liability complexity in parallel pathways, including contract structures for infrastructure roll-out, product claims, safety assurance and compliance management across mixed technologies.

Clear policy and behaviour change establishes a more consistent low carbon pathway, reducing uncertainty and supporting wider deployment of charging networks and alternative fuel supply chains.

Heavy transport decarbonisation accelerates with clearer commercial models, while OEMs de-risk transition by aligning product strategy, supplier obligations and customer contracting to stable regulatory expectations.

Supply chains and logistics

Logistics and distribution chains remain largely unchanged, sustaining diesel dependence and leaving supply chains exposed to climate disruption and higher operating costs.

Manufacturers and logistics providers face rising due diligence, continuity and insurance pressures, with more emphasis on contractual resilience, supplier obligations and enforcement of delivery and quality standards under stress.

Smart mobility and delivery planning develop but are concentrated in larger urban centres, leaving gaps across regional and long-haul networks.

Logistics and manufacturing businesses must actively manage complexity across hybrid supply chains and regional performance differences.

Widespread smart mobility systems and more coordinated planning enable more efficient, connected logistics with fewer points of failure.

Contracting can shift from short-term contingency to longer-term optimisation, supporting collaboration models, integrated service agreements and stronger governance across logistics partners and infrastructure providers.

Resource use

Critical minerals become an increasingly contested resource as demand grows, with limited mitigation from reuse and recycling at scale.

OEM transition risk rises sharply where sourcing, traceability and supplier ESG standards are weak, increasing exposure to procurement disputes, supply interruption and reputational and legal challenge linked to upstream practices.

Competition for critical minerals continues, but improving management reduces some constraints while electrification demand keeps pressure high.

Automotive and advanced manufacturing clients increasingly rely on tighter legal controls in supplier contracting, audit rights and substantiated traceability to protect continuity and manage scrutiny.

Battery supply chains develop stronger reuse and recycling routes that reduce critical mineral competition and improve long-term resource resilience.

OEMs and manufacturers can embed circularity into commercial strategy through clearer end-of-life responsibilities, secondary materials contracting and more defensible claims on recycled content and provenance.

Consumers and markets

High costs and uneven access to low carbon options slows adoption, while smart mobility models risk being perceived as urban-centric and inaccessible.

OEMs and mobility providers face higher exposure to consumer protection, product safety and communications risk as cost of ownership models evolve and customers challenge affordability, performance and sustainability claims.

Adoption grows but remains uneven, with confidence constrained by inconsistent infrastructure availability and the coexistence of competing vehicle and charging standards.

Mobility services and OEM offerings depend more heavily on robust contracting and governance around data use, service reliability, safety assurance and customer redress in a mixed market.

Lower energy bills and more coherent infrastructure supports broader adoption of low carbon mobility and associated services, improving market confidence.

OEMs, logistics operators and mobility platforms can scale new models more quickly where privacy, safety and substantiation controls are designed in from the outset rather than retrofitted.

What this means for mobility, manufacturing & logistics leaders

Transition risk has deep implications for capital allocation, supply chain strategy, infrastructure investment and commercial models across mobility, manufacturing and logistics. Across these sectors, transition risk is shaped by the gap between policy ambition and delivery capability. Even where direction is clear, delays in infrastructure, resource availability and behavioural change can materially affect outcomes for the sector.

The main lesson for mobility, manufacturing and logistics businesses is that infrastructure readiness, resource resilience and customer confidence are becoming connected. The future of mobility is no longer just a vehicle or fuel choice. It depends on charging access, grid capacity, route reliability, supplier obligations, technology standards and cost of ownership. Similarly, supply chain and resource pressures are no longer background operational risks. They shape procurement strategy, product design, business continuity planning, customer affordability, contractual exposure and the ability to prove that lower carbon products and services are credible in practice. For leadership teams, scenario analysis is no longer a reporting tool. It is a strategic capability that helps organisations:

test the resilience of operational and supply chain models under different energy, policy and technology conditions
prioritise investment across electrification, infrastructure and circular supply chains
identify where transition exposure is highest across assets, geographies and customer segments
position for growth in emerging markets such as low carbon manufacturing, smart logistics and mobility as a service

Scenario analysis provides a practical way to navigate this uncertainty. By exploring how transport systems, industrial processes and supply chains evolve across different pathways, organisations can make more informed decisions on where to deploy capital, how to redesign operations and how to build resilient systems that remain viable as the transition accelerates.

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Understanding transition risk in financial services

Thu, 6 Aug 2026 00:00:00 +0100

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Understanding transition risk in financial services

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Published: 5 August 2026
Author: Max Finney

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What is climate scenario modelling – and why use it?

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The three scenarios used

1. Business as Usual (BAU)

No major policy changes beyond current commitments. This represents the slowest pace of decarbonisation and the highest level of sustained climate risk.

2. Moderate Ambition

Some policy progress, but behaviour change and infrastructure deployment lag behind net zero pathways.

3. 1.5°C Aligned (Balanced Pathway)

Policy and behaviour change keep pace with net zero goals. This scenario delivers the most resilient and lowest‑carbon future.

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What are the material transition risks and opportunities for financial services?

Short term (to 2030)

Key risks

energy cost volatility: Continued reliance on fossil fuels keeps energy costs high in Business as Usual and Moderate Ambition scenarios, raising operational costs across digital infrastructure and financial institutions. For financial services, sustained energy volatility directly affects the cost base of offices, trading floors and data‑intensive activities such as payments processing, cloud services and AI‑enabled analytics
infrastructure constraints: Power grid capacity and water stress risks limiting the growth of data centres, slowing the deployment of digital finance and AI‑driven services. This creates a material risk for financial services firms that rely on secure, scalable digital infrastructure to deliver core services, manage risk models and meet client expectations
climate‑related disruption: More frequent storms and heatwaves cause outages to energy, transport and digital systems, affecting financial system resilience. For banks, insurers and asset managers, this increases operational resilience risk and can disrupt service continuity, transaction processing and client access
reputational pressure: Slower decarbonisation damages the UK's standing as a global green finance centre. Financial services firms face heightened reputational and conduct risk if clients, investors or regulators perceive misalignment with net zero ambitions.

Opportunities

early investment in nature‑based solutions, digital resilience and AI for climate analytics creates opportunities to develop new advisory services, financing products and risk tools that support clients’ transition plans
growing demand for sustainable finance instruments and climate‑aligned investment products supports revenue growth in areas such as green bonds, transition finance, sustainability‑linked lending and climate‑focused funds.

Medium term (to 2040)

Key risks

misaligned investment flows: Delays in grid upgrades and sustained fossil fuel infrastructure shift capital away from the UK. This increases market and portfolio risk as capital reallocates across geographies and sectors perceived as more transition‑ready
regulatory tightening: More stringent disclosure and transition planning requirements increase operational and legal risk for firms slow to adapt. Greater scrutiny of governance, climate claims and fiduciary duties linked to climate‑related financial risk create additional administrative burden and exposure to fines and enforcement for non-compliance
technology bottlenecks: Without rapid electrification, both BAU and Moderate Ambition scenarios limit fintech growth and reduce competitiveness. This constrains innovation in financial services, particularly in digital payments, data‑driven credit assessment and AI‑enabled compliance tools
water scarcity: Competition for water between housing, industry and digital infrastructure constrains development in all sectors. This translates into location risk for data centres and increased due diligence requirements on financed assets, increasing the burden of administration and therefore timelines of deals.

Opportunities

financial innovation to support hydrogen, carbon capture, battery recycling and critical minerals markets. Those firms that are well placed to structure, finance and insure the infrastructure and technologies required for a net zero economy stand to gain significant market share and revenue
client demand for transition planning, portfolio decarbonisation and climate risk advisory services strengthens the strategic role of financial services as enablers of credible transition pathways across the real economy

Long term (to 2050)

Key risks

systemic market disruption: In BAU, sustained vulnerability across energy, transport and water systems affects asset values, risk modelling and lending decisions. This raises systemic financial risk and challenges traditional approaches to credit, insurance pricing and capital allocation. Disruption to established processes result in exposure to volatile markets and increased cost for development of new models
digital inequality: Rapid digitalisation without resilience measures risks excluding vulnerable groups and exposing them to cyber threats. Conduct, consumer duty and reputational risks for financial services providers increase exponentially reliant on digital‑first delivery models
stranded assets: Retained fossil fuel infrastructure increases long‑term exposure to devaluation and transition cost shocks. Banks, insurers and investors face heightened balance sheet risk if transition exposure is not actively managed.

Long‑term opportunities

a fully decarbonised grid in the 1.5°C scenario reduces energy prices and unlocks scalable deployment of data‑centric financial services. Long‑term operational resilience and growth in digital, data‑intensive financial products supports operation resilience and investment opportunities
mature supply chains for renewables, battery technology and natural capital markets create new investment avenues, with financial services playing a central role in mobilising capital and shaping these emerging markets
inclusive and just‑transition strategies strengthen customer trust and market resilience through a wider, more diverse range of participants in the economy, increasing the pool of talent for firms to recruit from and investment opportunities in entrepreneurs and SMEs

How risks and opportunities vary across the three climate scenarios

THEME

BUSINESS AS USUAL

MODERATE AMBITION

1.5°C ALIGNED

Energy

High and volatile power prices driven by continued fossil fuel reliance increase operating costs for business.

Grid constraints limit data centre expansion, slowing AI, cloud migration and fintech innovation.

Partial grid decarbonisation reduces some volatility but continued gas reliance keeps prices elevated.

Data centre growth constrained in some regions, creating uneven access to digital capacity.

Fully decarbonised, resilient grid delivers more stable energy prices.

Scalable, low carbon power enables data centre expansion, advanced analytics, AI deployment.

Technology

Limited data centre capacity and infrastructure disruption from extreme weather reduce system resilience.

Slower AI adoption constrains risk modelling, climate analytics and innovation.

Regional disparities in digital infrastructure persist, limiting rollout of digital innovations.

Improved but uneven digital infrastructure supports growth in core systems, but power and water constraints limit advanced AI use.

Cyber resilience and redundancy require higher ongoing investment due to extreme weather and uneven policy implementation.

Reliable, low carbon digital infrastructure supports widespread AI, real time climate risk assessment and fintech growth.

Higher system resilience reduces outage risk and improves customer trust and adoption.

Policy and Legal

Weak and inconsistent policy signals reduce investor confidence in UK sustainable finance.

Regulatory change is reactive and frequent, increasing compliance complexity and cost without clear long-term direction.

Clearer direction than BAU but continued policy uncertainty increases regulatory burden.

Firms face overlapping reporting, transition planning and supervisory expectations across regimes.

Increase in transparency requirements exposes firms to increased stakeholder pressure and reputational risk.

Clear, stable and credible policy framework aligned to net zero supports long term capital allocation.

Strong cross-border regulatory certainty accelerates green finance, transition products and innovation.

Significant increase in transparency and compliance requirements result in potential cost to do business, despite assumed AI efficiency gains.

Reputation

UK loses leadership position as a global green finance centre.

Firms face reputational risk from perceived misalignment with climate goals and reduced international competitiveness.

Reputation risks remain if progress is seen as too slow or inconsistent.

Competitive pressure increases from jurisdictions with clearer net zero delivery.

Reputation strengthened through credible net zero alignment, resilient infrastructure and leadership in sustainable and transition finance, reinforcing the UK’s global standing as a global hub for green finance.

Communities and Consumers

Higher energy and insurance costs disproportionately affect vulnerable customers, increasing credit, affordability and conduct risks for financial institutions.

Faster change creates transition risk for some customers and SMEs if support mechanisms lag.

Financial inclusion challenges persist for digitally excluded groups.

More inclusive transition supported by coordinated policy and investment.

Lower system costs and better digital access improve financial inclusion and resilience for households and businesses.

What this means for financial services leaders

Climate transition risk has deep implications for capital allocation, operational resilience, digital strategy and consumer outcomes across financial services. For GCs, sustainability heads and leaders across the business, scenario analysis is becoming more than a reporting exercise, it is a strategic tool to understand potential futures and ensure the business is fit for purpose beyond the next reporting cycle.

Organisations can use scenario analysis for a host of reasons including, but not limited too:

identify where transition exposure is highest across markets and portfolios
build resilience into operational, legal and governance frameworks
position for opportunities in emerging low‑carbon and nature‑based markets

Within financial services, transition risk is generally more advanced than in many other sectors, a development largely attributed to legislation like TCFD. Yet, despite this progress, actions remain insufficient; global financed emissions continue to rise even as investment intensity decreases. As regulators increasingly demand credible transition pathways instead of simply setting long-term targets, investors and NGOs are paying closer attention to the gap between stated commitments and actual capital flows. The risks linked to litigation, greenwashing, and fiduciary duty are escalating when disclosures and strategies fail to align, making it more important than ever for institutions to ensure consistency. Moreover, trends in financed emissions now directly influence transition risk assessments, stress testing, and capital adequacy discussions, reflecting their growing significance in the industry.

Given the increased scrutiny on transition risk, scenario analysis emerges as a critical strategic tool for financial services leaders. By systematically exploring a range of possible futures, organisations can proactively identify and mitigate the risks of higher costs, reduced access for vulnerable groups, and operational disruption during periods of rapid change. Considering the volatility of the geopolitical situation in many regions, this more fluid approach enables firms to take a more holistic and balanced approach to climate risks and opportunities. This approach not only supports compliance with regulatory demands for credible transition plans, but also enables firms to align their capital allocation and operational strategies with a more inclusive and resilient transition, thereby reducing exposure to litigation and reputational damage from greenwashing or unfulfilled commitments.

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Understanding transition risk in energy & infrastructure

Thu, 6 Aug 2026 00:00:00 +0100

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Understanding transition risk in energy & infrastructure

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Published: 5 August 2026
Author: Max Finney

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What is climate scenario modelling – and why use it?

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The three scenarios used

1. Business as Usual (BAU)

No major policy changes beyond current commitments. This represents the slowest pace of decarbonisation and the highest level of sustained climate risk.

2. Moderate Ambition

Some policy progress, but behaviour change and infrastructure deployment lag behind net zero pathways.

3. 1.5°C Aligned (Balanced Pathway)

Policy and behaviour change keep pace with net zero goals. This scenario delivers the most resilient and lowest‑carbon future.

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What are the material transition risks and opportunities for energy & infrastructure?

Short term (to 2030)

Key risks

energy price volatility and fossil fuel dependency: Electricity prices remain closely linked to global oil and gas markets, increasing uncertainty for project economics and route to market decisions
grid constraints and connection delays: Limited network capacity slows the deployment of renewable and hybrid energy projects and restricts growth in energy-intensive infrastructure such as data centres
policy and route to market uncertainty: Evolving UK policy frameworks create complexity for PPAs, pricing models and long-term revenue certainty
water stress and system competition: Competing demand between power generation, hydrogen production and data centres places pressure on water infrastructure and planning decisions
supply chain disruption and critical minerals pressure: Early-stage electrification drives demand for critical materials, increasing cost volatility and delivery risk

Opportunities

scaling hybrid clean energy development: Integrated generation, storage and flexible assets improve resilience and commercial performance
expansion of PPAs and structured revenue models: Growing demand for long-term power agreements creates opportunities for innovation in route to market
increased infrastructure investment activity: Strong capital flows into clean energy and infrastructure support project development and pipeline growth

Medium term (to 2040)

Key risks

misaligned energy system investment: Continued reliance on fossil fuel infrastructure slows the benefits of renewable deployment and increases transition cost
network capacity and electrification constraints: Demand from transport, buildings and industry places sustained pressure on grid infrastructure
technology uncertainty across transition pathways: Competing roles for hydrogen, carbon capture and electrification create complexity for long-term investment decisions
rising capital costs and financing complexity: Projects become more capital intensive, requiring more sophisticated funding structures and increasing execution risk

Opportunities

expansion of E&I finance capability: More complex financing structures, including debt and blended capital, support growth in advisory and execution
heavy transport decarbonisation: Regulatory pressure on HGV emissions drives investment in electrification and alternative fuels
integrated infrastructure systems: Linking energy, transport and digital infrastructure creates more resilient and scalable project models.

Long term (to 2050)

Key risks

stranded assets in legacy infrastructure: Failure to transition away from fossil fuel assets creates long-term financial exposure
systemic infrastructure vulnerability: Underinvestment in integrated systems reduces resilience to climate and market shocks
resource constraints across water and materials: Persistent competition for key resources limits system performance and expansion

Long‑term opportunities

decarbonised and stable energy systems: Reduced reliance on fossil fuels delivers more predictable long-term pricing
leadership in next generation energy and infrastructure: Developers and investors aligned to net zero pathways are best placed to capture long-term market value
fully integrated infrastructure networks: Coordinated investment across energy, water, transport and digital systems improves resilience and efficiency

How risks and opportunities vary across the three climate scenarios

THEME

BUSINESS AS USUAL

MODERATE AMBITION

1.5°C ALIGNED

Energy

Electricity prices remain exposed to global oil and gas markets due to continued fossil fuel reliance and slower electrification of the system.

Developers, investors and energy-intensive users such as data centres face sustained cost volatility and reduced confidence in long-term PPA pricing structures.

Partial grid decarbonisation reduces some exposure to fossil fuels, but continued reliance on gas keeps prices elevated and uneven across regions.

Hybrid energy developers and investors must manage inconsistent economics across assets and geographies.

A fully decarbonised electricity system decouples pricing from fossil fuel markets and improves long-term price stability.

Clean energy developers, infrastructure investors and large energy users benefit from predictable costs and scalable low carbon power supply.

Infrastructure

Limited investment in transmission and distribution infrastructure constrains capacity and delays the connection of new energy assets.

Grid bottlenecks restrict delivery of renewable projects, hydrogen developments and data centre expansion.

Targeted infrastructure upgrades improve capacity in some locations but fail to keep pace with system-wide electrification.

Developers must navigate regional constraints and increased competition for network access.

Coordinated investment in energy networks enables large-scale integration of renewables, storage and electrified demand.

Developers, infrastructure providers and digital operators benefit from reliable, high-capacity systems that support growth across sectors.

Route to market

Uncertainty in policy frameworks and pricing mechanisms reduces the availability and effectiveness of long-term PPAs and structured revenue models.

Clean energy developers face challenges securing bankable agreements and attracting capital.

Increasing policy clarity supports growth in structured PPAs, but variations in implementation create uneven market access.

Developers and investors must tailor route to market strategies across different regions and project types.

Mature and transparent route to market mechanisms support long-term contracting and efficient pricing.

Developers, financiers and corporate offtakers benefit from stable revenue models and increased liquidity in energy markets.

Investment

Slower policy progress and infrastructure constraints reduce investor confidence and delay capital deployment into clean energy and infrastructure projects.

Financing activity remains selective, limiting growth in hybrid energy, heavy transport and emerging technologies.

Capital is deployed more actively, but investment remains focused on lower-risk or established assets due to persistent uncertainty.

Growth in E&I finance increases, but more complex projects still face constraints in securing funding.

Strong policy alignment and clear transition pathways unlock significant capital flows into clean energy and infrastructure systems.

Investors, lenders and developers are able to scale financing across renewables, transport electrification and integrated infrastructure projects.

Resources

Demand for critical minerals and water resources increases rapidly without coordinated management, leading to supply constraints and cost pressures.

Developers and infrastructure operators face delays, increased procurement risk and location constraints for projects such as hydrogen and data centres.

Improved resource management reduces some constraints, but supply chains remain under pressure from electrification demand and competing uses.

Developers and operators must actively manage sourcing strategies and project design to mitigate risk.

Circular economy approaches and diversified supply chains reduce dependence on primary materials and improve resource efficiency.

Energy and infrastructure projects are delivered with greater resilience, supported by more stable supply chains and reduced exposure to resource volatility.

What this means for energy & infrastructure leaders

Climate transition risk has deep implications for capital allocation, project delivery, system resilience and commercial models across energy and infrastructure. For developers, investors and advisers, scenario analysis is becoming more than a reporting exercise, it is a strategic tool to understand how different pathways will shape asset performance and market opportunity over time.

Within energy and infrastructure, transition risk is increasingly shaped by the interaction between policy ambition and delivery capability. Even where direction is clear, delays in grid investment, supply chain capacity and planning frameworks can materially affect outcomes for projects and portfolios. As a result, there is growing scrutiny on the credibility of delivery pathways, not just the ambition of targets.

Organisations can use scenario analysis for a host of reasons including, but not limited to:

test the resilience of revenue models, including PPAs and route to market strategies, under different pricing and policy conditions
inform investment and financing decisions across a more complex and capital-intensive pipeline of clean energy and infrastructure assets
position for opportunities in emerging markets such as hybrid energy systems, transport decarbonisation and integrated infrastructure

Given this, scenario analysis provides a practical way to navigate uncertainty. By exploring how energy systems, infrastructure investment and resource constraints evolve across different pathways, organisations can better understand the trade-offs between cost, resilience and growth. This supports more informed decisions on where to deploy capital, how to structure projects and how to build systems that remain viable as the transition accelerates.

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Understanding transition risk in technology & AI

Thu, 6 Aug 2026 00:00:00 +0100

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Understanding transition risk in technology & AI

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Published: 5 August 2026
Author: Max Finney

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What is climate scenario modelling – and why use it?

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The three scenarios used

1. Business as Usual (BAU)

No major policy changes beyond current commitments. This represents the slowest pace of decarbonisation and the highest level of sustained climate risk.

2. Moderate Ambition

Some policy progress, but behaviour change and infrastructure deployment lag behind net zero pathways.

3. 1.5°C Aligned (Balanced Pathway)

Policy and behaviour change keep pace with net zero goals. This scenario delivers the most resilient and lowest‑carbon future.

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What are the material transition risks and opportunities for technology & AI companies?

Our scenario analysis highlights several critical impacts of the transition to net zero across digital infrastructure, energy systems, resource use, supply chains and consumer outcomes. These evolve over time and present both challenges and opportunities for organisations operating across technology, AI, cloud services, digital infrastructure and data-intensive business models.

Short term (to 2030)

Key risks

infrastructure and energy constraints: Growth in AI and digital services increases demand for data centre capacity, but electrical grid constraints and insufficient transmission infrastructure can limit expansion and reduce processing capacity available for AI-enabled services and digital innovation.
consumer pushback: As AI becomes more embedded in everyday products and services, consumers may increasingly question whether the benefits justify the environmental and ethical trade-offs. Concerns around data centre energy and water use, privacy, bias, transparency and job impacts could slow adoption where organisations fail to show clear value, responsible governance and credible impact management.
climate-related disruption: Storms, heatwaves and wider infrastructure vulnerability increase the risk of outages affecting digital connectivity, cloud services and critical technology infrastructure, undermining reliability and resilience.
water scarcity pressures: Large-scale data centres create significant cooling requirements in some locations. Competition for water resources and increasing water stress may constrain future development and increase operating costs.
supply chain and reputational exposure: The growing demand for semiconductors, critical minerals and digital infrastructure components increases exposure to environmental and social risks within global supply chains, creating both operational and reputational challenges.

Opportunities

AI-enabled climate solutions: AI applications supporting climate adaptation, energy management, healthcare and mobility create opportunities for technology providers to support decarbonisation across the wider economy while opening new markets and revenue streams.
investment in digital resilience: Organisations that invest early in resilient digital infrastructure, cyber security, low-carbon data centres and renewable-powered services are likely to benefit from increasing demand for trusted and sustainable technology solutions, as well as resilience from energy price spikes and lower total cost of ownership for assets.

Medium term (to 2040)

Key risks

tension between AI growth and climate ambitions: As AI adoption accelerates, energy demand from data centres and digital services increases significantly. Without sufficient renewable generation and transmission upgrades, organisations face growing pressure to balance growth ambitions with climate commitments.
data centre location constraints: Water availability, grid capacity and planning restrictions increasingly influence where digital infrastructure can be developed, limiting flexibility and potentially increasing regional inequalities in digital capacity.
consumer trust and cyber risks: Greater reliance on digital services, AI and connected infrastructure increases exposure to cyber security incidents, operational disruption and loss of public trust if system resilience and protection is not maintained and consistently improved in line with best practice.
resource dependency: Continued expansion of AI, cloud computing and advanced technologies increases demand for critical minerals and specialised components, intensifying supply chain competition and scrutiny on the social and environmental impact of extracting and processing those resources.

Opportunities

low-carbon digital infrastructure: Continued global expansion of renewable electricity generation and grid decarbonisation creates favourable conditions for commercially viable sustainable AI deployment and wider green digital transformation.
advanced resource management: Growth in circular economy approaches, improved environmental management and more responsible sourcing creates opportunities to reduce supply chain risk and demonstrate leadership in sustainable technology development, utilising technology such as block chain to provide granular, reliable tracing of materials through supply chains.
expansion of AI applications: Continued deployment of AI across sectors such as healthcare, mobility, infrastructure and climate adaptation strengthens the strategic role of technology businesses in enabling an effective transition.

Long term (to 2050)

Key risks

infrastructure resilience risk: As economies become increasingly dependent on digital systems, failures in energy, water or data infrastructure create systemic risks affecting organisations, consumers and wider economic activity. Liability for this disruption is likely to fall on technology providers, increasing overheads and insurance premiums.
digital exclusion: Increased reliance on AI-enabled services may exclude vulnerable or digitally disadvantaged groups if accessibility and inclusion are not embedded into service design and delivery. Organisations that fail to embed accessibility, inclusion and human-centred design into products and services risk reputational damage, reduced customer trust and increased regulatory scrutiny.
persistent supply chain scrutiny: Expectations regarding environmental impacts, resource use and labour practices across global technology supply chains continue to intensify, increasing legal, reputational and commercial exposure.

Long‑term opportunities

Data centre expansion enabled by clean energy: In a 1.5°C aligned pathway, renewable generation and transmission investment keep pace with demand, supporting large-scale deployment of AI, cloud computing and advanced digital services.
Climate-resilient digital ecosystems: Improved infrastructure resilience, robust cyber security and reliable connectivity strengthen confidence in digital services and support sustainable economic growth.
Technology-enabled societal benefits: Mature AI solutions support healthcare, mobility, infrastructure management and resource efficiency, helping organisations create wider social value while improving competitiveness.

How risks and opportunities vary across the three climate scenarios

THEME

BUSINESS AS USUAL

MODERATE AMBITION

1.5°C ALIGNED

Digital infrastructure

Data centre growth constrained by electricity network capacity and infrastructure resilience challenges. Connectivity remains vulnerable to storms, heatwaves and outages.

Data centre development concentrated in locations with available grid capacity. Digital growth continues but is uneven across regions.

Grid and renewable investment keeps pace with demand, supporting widespread digital infrastructure growth and resilient connectivity.

Energy

Growing tension between digital sector expansion and energy system constraints. AI deployment limited by available low-carbon power.

Renewable deployment progresses but infrastructure constraints continue to influence the scale and location of technology investment.

Renewable-powered digital infrastructure supports large-scale AI deployment and sustained sector growth.

Water and resources

Water demand from data centres creates competition for resources in stressed regions. Supply chain impacts from critical minerals attract growing scrutiny.

Alternative cooling technologies and improved management reduce some resource constraints, but water and material availability remain important considerations.

Strategic spatial planning and efficient cooling technologies reduce water impacts, while stronger environmental management improves resource resilience.

Supply chains and governance

Supply chain vulnerabilities and environmental impacts create operational and reputational risks.

Polarised governance requirements across territories increase uncertainty and compliance burden, causing higher overhead costs.

Greater emphasis placed on resilient and responsible sourcing supports expanding digital infrastructure, reducing risk of supply chain shocks.

Governance ambitions remain fractured but increased alignment enables more holistic compliance approach.

Robust supply chains and stronger environmental management support sustainable industry growth and investor confidence.

Aligned regulatory environment enables long term certainty and more efficient compliance.

Consumers and society

Public concern around AI accelerates as energy demand, water use, data centre expansion and critical mineral sourcing become increasingly visible.

Trust in AI-enabled services remains fragile and adoption is uneven, particularly where organisations cannot clearly demonstrate tangible benefits or address concerns around privacy, transparency and workforce impacts

Consumers increasingly expect organisations to demonstrate responsible AI governance, transparency and measurable societal value alongside innovation.

Environmental and ethical concerns do not significantly slow adoption, but they create greater regulatory pressure, investor scrutiny and competitive differentiation between trusted and less trusted providers.

Digital infrastructure, cyber security and inclusive design support broader access to technology benefits across society.

AI applications strengthen outcomes in healthcare, mobility and other critical services.

What this means for technology & AI leaders

Transition risk has significant implications for digital infrastructure strategy, AI deployment, energy procurement, operational resilience and supply chain management across the technology sector. The pace of digitalisation increasingly depends on the availability of energy, resilient infrastructure and access to critical resources. At the same time, growing scrutiny of AI, cyber security and social inclusion means that despite the focus on growing market share, organisations must balance growth ambitions with wider environmental and societal expectations.

For technology and AI leaders, the challenge is no longer simply whether AI can be deployed at scale, but whether it can be deployed in a way that customers, regulators, investors and communities are willing to support. Access to low-carbon energy, water availability, digital infrastructure resilience and responsible supply chains are becoming increasingly important determinants of growth. Equally, public trust is emerging as a critical business asset. Organisations that cannot clearly demonstrate the value of AI, while addressing concerns around privacy, transparency, workforce impacts and environmental footprint, may find adoption slows despite strong underlying demand.

Scenario analysis provides a practical way to test these future challenges before they materialise. It can help organisations:

understand where energy, water and infrastructure constraints could limit future growth and innovation
identify vulnerabilities within digital infrastructure, supply chains and critical resource dependencies
assess how changing stakeholder expectations, regulation and consumer trust could affect adoption of AI-enabled products and services
build more resilient, transparent and trusted approaches to AI deployment
identify opportunities linked to digital resilience, climate adaptation and technology-enabled decarbonisation

The technology organisations most likely to succeed will be those that recognise trust and resilience as competitive advantages, not compliance obligations. As AI becomes increasingly central to economic activity, market leadership will be shaped not only by technical capability, but also by an organisation's ability to secure the energy, infrastructure, resources and public confidence needed to scale responsibly. Those that can demonstrate clear societal value, strong governance and responsible innovation will be better positioned to attract customers, investment and long-term growth.

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Understanding transition risk in consumer & retail

Wed, 5 Aug 2026 00:00:00 +0100

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Understanding transition risk in consumer & retail

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Published: 5 August 2026
Author: Max Finney

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What is climate scenario modelling – and why use it?

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The three scenarios used

1. Business as Usual (BAU)

No major policy changes beyond current commitments. This represents the slowest pace of decarbonisation and the highest level of sustained climate risk.

2. Moderate Ambition

Some policy progress, but behaviour change and infrastructure deployment lag behind net zero pathways.

3. 1.5°C Aligned (Balanced Pathway)

Policy and behaviour change keep pace with net zero goals. This scenario delivers the most resilient and lowest‑carbon future.

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What are the material transition risks and opportunities for consumer & retail?

Short term (to 2030)

Key risks

greenwashing and claims scrutiny: Environmental claims around recyclability, carbon neutrality, sustainable sourcing, recycled content and product impact must be clear, accurate, evidence based and consistent across the supply chain. The risk is particularly material where claims are repeated by retailers, online marketplaces or brand partners without sufficient substantiation.
packaging compliance and cost pressure: Extended producer responsibility for packaging increases the importance of packaging data, material choices, recyclability assessments and governance over brand, private label, imported and ecommerce packaging. Poor data or hard to recycle packaging could increase cost exposure and operational complexity.
energy cost volatility: Continued exposure to fossil fuel linked energy prices increases operating costs across stores, warehouses, refrigeration, hospitality, leisure sites, fulfilment centres and data intensive ecommerce platforms.
logistics and distribution disruption: Storms, heatwaves and infrastructure vulnerability increase the risk of disruption to transport, warehousing and last mile delivery, affecting service levels, inventory availability and contractual performance.
changing consumer practices: Cost of living pressures, sustainability expectations and trust in claims are reshaping purchasing decisions. Consumers may support more sustainable products in principle, but adoption can be uneven if alternatives are less affordable, less convenient or poorly evidenced.

Opportunities

better claims governance can protect trust, reduce enforcement risk and allow genuine product improvements to stand out in a crowded market
packaging design, refill, reuse, repair, resale and take back models can reduce resource dependence and create distinctive customer propositions
investment in energy efficiency, renewable procurement and smarter estate management can reduce long term exposure to volatile operating costs

Medium term (to 2040)

Key risks

misaligned investment flows: Delays in decarbonisation infrastructure investment can constrain deployment of electrified retail estates, distribution networks and low carbon logistics solutions. Businesses may face higher operating costs and slower deployment of low carbon technologies, making it harder to compete with markets that are seen as more transition ready.
regulatory tightening: Greater scrutiny of environmental claims, supply chain transparency, packaging compliance and reporting obligations creates additional administrative burden and increases exposure to litigation, fines, enforcement action and reputational damage where claims or disclosures cannot be substantiated.
technology bottlenecks: Without sufficient grid capacity and electrification infrastructure, businesses may face constraints in expanding decarbonised logistics, warehousing, refrigeration, ecommerce fulfilment and AI-enabled retail operations. This can slow adoption of automation, digital inventory management and lower carbon logistics solutions, increase costs and reducing competitiveness against operators in markets with more mature infrastructure.
water scarcity: Competition for water between households, agriculture, manufacturing and digital infrastructure increases supply chain risk across consumer and retail sectors. Businesses may face greater disruption to food, beverage, apparel and consumer goods supply chains, alongside increased due diligence requirements for suppliers operating in water stressed regions. This can increase costs, reduce sourcing flexibility and create greater scrutiny of responsible resource management practices

Opportunities

organisations that embed circularity into product design and customer experience stand to strengthen branding, reduce material exposure and unlock new revenue streams.
consumer demand for sustainable products and transparent supply chains strengthens the role of brands and retailers as enablers of more sustainable consumption. Organisations that can demonstrate credible progress on climate, packaging, waste reduction and responsible sourcing are likely to strengthen customer trust, attract investment and differentiate themselves in increasingly competitive markets.

Long term (to 2050)

Key risks

systemic market disruption: Sustained vulnerability across energy, transport and water systems affects the availability, cost and reliability of products and raw materials that support consumer markets. Businesses face increasing pressure from supply shortages, price volatility and disruption to logistics and distribution networks, making long term planning, inventory management and customer fulfilment more challenging.
digital inequality: Increasing reliance on digital commerce, AI enabled services and self-service customer journeys risks excluding digitally disadvantaged or lower income consumers if accessibility and inclusion are not embedded into product and service design. This can reduce market reach, weaken customer trust and create reputational and regulatory challenges.
nature and biodiversity decline: Nature degradation and biodiversity loss threaten the availability, quality and cost of the natural resources that underpin many consumer and retail products. Food, beverage, apparel, personal care and consumer goods supply chains depend on healthy ecosystems, water resources, soil quality and biodiversity. Businesses may face increasing sourcing challenges, regulatory scrutiny and cost pressures where natural capital is degraded or poorly managed, requiring greater investment in responsible sourcing, traceability and nature positive supply chains.

Long‑term opportunities

a fully decarbonised energy system reduces operational costs and improves resilience across stores, warehouses, manufacturing facilities, hospitality venues and ecommerce fulfilment centres.
more stable energy prices from renewable energy deployment supports investment in electrification, automation and lower carbon logistics while improving long term competitiveness.
mature circular supply chains and improved access to recycled materials reduce exposure to virgin resource constraints and volatile commodity markets.
inclusive and affordable transition strategies strengthen customer trust, brand value and market resilience

How risks and opportunities vary across the three climate scenarios

THEME

BUSINESS AS USUAL

MODERATE AMBITION

1.5°C ALIGNED

Regulation and compliance

Packaging and other compliance costs and reporting burdens increase as obligations expand unevenly across regions.

Environmental claims face scrutiny, but inconsistent regulation creates uncertainty and higher legal and compliance costs.

Regulatory expectations become clearer but overlapping regional requirements continue to create complexity.

Businesses improve governance around packaging, sustainability disclosures and product claims, inconsistency in data and progress within supply chains create ongoing challenges to delivery.

Clear and stable policy frameworks support long term planning and investment.

Robust governance, high quality data and mature compliance systems enable businesses to manage obligations, substantiate claims and respond efficiently to evolving sustainability requirements.

Credibility and transparency become competitive advantages.

Consumers and markets

Consumers remain concerned about sustainability but may push back where lower carbon alternatives are perceived as less affordable, less convenient or poorly evidenced.

Trust in environmental claims remains fragile and purchasing decisions are increasingly influenced by concerns around authenticity and value.

Sustainable products and services become more mainstream, but adoption remains uneven across customer groups and markets.

Businesses that can combine affordability, convenience and credible sustainability credentials strengthen customer loyalty and market positioning.

Lower system costs, more transparent information and greater availability of sustainable products support widespread consumer participation.

Trust in sustainability claims improves and businesses benefit from stronger customer relationships and more resilient demand.

Resource management

Dependence on virgin materials and inefficient resource use increases exposure to commodity price volatility, material scarcity and waste management costs.

Circular business models remain niche and struggle to scale.

Resource efficiency improves through better packaging design, waste reduction and increased use of recycled materials.

Progress is uneven across sectors and products, but businesses that invest early begin to reduce cost and supply risks.

Circular economy principles are embedded across product design, sourcing and operations.

Reduced dependence on virgin materials improves resilience, lowers costs and mitigates exposure to resource volatility, while supporting long term competitiveness.

Nature and biodiversity

Nature degradation, biodiversity loss and water stress increasingly affect the availability, quality and cost of natural resources that underpin many consumer products.

Businesses face greater sourcing challenges, supply disruption and reputational risk where impacts on ecosystems are poorly managed.

Better management of natural capital reduces some risks, but pressure on ecosystems continues in key sourcing regions.

Businesses invest more heavily in responsible sourcing, traceability and supplier engagement to manage regulatory and stakeholder expectations.

Nature positive approaches, regenerative supply chains and stronger environmental stewardship support long term resource security.

Businesses benefit from more resilient sourcing, improved stakeholder trust and reduced exposure to ecosystem degradation and biodiversity loss.

Supply chains

Supply chains remain exposed to climate disruption, infrastructure vulnerability, water stress and geopolitical instability.

Product availability becomes less predictable, logistics costs rise and businesses must devote greater resources to continuity planning and supplier monitoring.

Greater visibility and collaboration improve resilience across supply chains, although disruption remains a material risk.

Enhanced traceability, stronger supplier partnerships and improved data help businesses manage cost, continuity and reputational exposure.

Diversified sourcing, strong supplier relationships and advanced traceability systems create more resilient and transparent supply chains.

Improved coordination reduces disruption, strengthens responsible sourcing practices and supports long term operational stability.

What this means for consumer & retail leaders

Transition risk has deep implications for consumer and retail strategy because it cuts across the core of how products are sourced, made, marketed, sold, delivered, used and recovered. For general counsel, sustainability leads, commercial teams, procurement, product, marketing and operations, scenario analysis is becoming more than a reporting exercise. It is a practical way to test whether the business remains resilient as regulation, consumer expectations, infrastructure and resource availability change.

The main lesson for consumer and retail businesses is that trust, resource efficiency and operational resilience are becoming connected. A product claim is no longer just a marketing issue. It depends on packaging data, supplier evidence, product design, logistics, lifecycle impact and the ability to prove what has been said. Similarly, packaging and waste are no longer back-office compliance issues. They shape input costs, customer experience, supplier resilience and exposure to regulatory change.

Organisations can use scenario analysis to:

identify where transition exposure is highest across products, packaging, suppliers, channels, estates and customer segments
test whether environmental claims, packaging data and sustainability governance are robust enough for higher scrutiny
prioritise investment in circularity, waste reduction, supplier engagement, energy efficiency and logistics resilience
understand how affordability, inclusion and changing consumer practices could influence adoption of low carbon products and services
position for growth through credible product claims, practical circular services and more resilient supply chains

The consumer and retail organisations most likely to succeed will be those that treat the transition as a commercial redesign challenge, not a compliance add on. Businesses that can reduce waste, evidence claims, manage packaging obligations, work with suppliers and offer customers credible, affordable choices will be better placed to build trust and adapt as the transition accelerates.

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Law Commission consultation: Reforming interim rent on lease renewals

Tue, 4 Aug 2026 00:00:00 +0100

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Law Commission consultation: Reforming interim rent on lease renewals

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Our next article considering the Law Commission's consultation on the future of the Landlord and Tenant Act 1954 (the Act) tackles one of the more complex and frequently misunderstood aspects of the lease renewal process: interim rent.

Published: 4 August 2026
Authors: Elinor Sandbach

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The Act currently contains detailed provisions dealing with interim rent. However, the Law Commission has concluded that the existing regime is difficult to understand, can produce uncertainty and tactical behaviour, and may lead to unfair outcomes both for landlords and tenants.

The consultation therefore considers whether the current approach should be replaced with a simpler system or retained in a more streamlined form.

Interim rent

When the contractual term of a lease protected by the Act expires, the tenant will often remain in occupation under a statutory continuation tenancy while the parties negotiate the terms of a renewal lease.

As a starting point, the terms of the existing lease continue during that continuation period. This means the tenant generally continues to pay rent at the level specified in the existing lease, even if market rental values have changed significantly since the lease was originally granted or the level of rent last reviewed.

Either party may, however, apply to the court for an interim rent determination.

The interim rent period starts from the earliest date that could have been specified in the relevant section 25 or section 26 notice, and continues until either:

1. the renewal tenancy is completed

2. the continuation tenancy comes to an end (for example, because the landlord successfully opposes renewal or the tenant decides not to proceed).

The current statutory regime is complicated because different valuation assumptions can apply depending on the circumstances. Where a renewal lease is ultimately granted, interim rent is often agreed to be the same as the rent payable under that new lease. However, the legislation contains a number of exceptions, particularly where:

1. rental values have changed substantially during the continuation period

2. the terms of the renewal lease differ from the existing tenancy

3. no renewal tenancy is ultimately granted.

Further complexity arises because the rent under the renewal tenancy is currently linked to the court's determination process. Legally, the valuation date is the commencement date of the renewal tenancy i.e. three months and three weeks after the court decides the provisions of the tenancy. Since future market conditions cannot be known, in practice the valuation date is generally treated as the date of the final hearing, even though that date may be itself uncertain (with final hearings sometimes listed for in excess of 12 months from the date of a Court application). This can create difficulties for valuers and encourage tactical delays in both rising and falling markets.

The Law Commission also highlights a practical cashflow issue. Until interim rent and renewal rent are agreed or determined, tenants continue to pay rent at the existing level. Once the final figures are established, a substantial balancing payment may become due from either landlord or tenant, potentially many months after the relevant period has ended.

Proposals for reform

Rather than abolishing interim rent altogether, the Law Commission has developed two alternative reform models.

Option A: fixed valuation and commencement dates

Under Option A, both the valuation date and commencement date for the renewal tenancy would be fixed by reference to the section 25 or section 26 notice.

The intention is to create a clearer and more predictable system in which the parties know from the outset the dates that will be used for valuation purposes.

If adopted, this approach would largely remove the need for separate interim rent provisions because the rent under the renewal tenancy would effectively apply from a date linked to the notice itself.

The principal advantages are greater certainty, simpler valuation evidence and reduced scope for tactical delay.

However, the proposal could create difficulties where the renewal tenancy differs materially from the existing tenancy. For example, if the renewal lease relates to only part of the premises, it may be unfair for the tenant to continue occupying the whole property during the continuation period while paying rent calculated by reference to the smaller demise.

The Law Commission therefore proposes that, in certain cases, adjustments could be made to reflect significant differences between the continuation tenancy and the renewal tenancy.

The consultation also seeks views on whether the notice-linked date should be:

the earliest date that could have been specified in the notice (which, following the amendments introduced by the Regulatory Reform (Business Tenancies) (England and Wales) Order 2003, is the date from which interim rent is currently payable); or
the actual termination date specified in the notice.

This distinction could have significant strategic implications. The 2003 Order deliberately severed the link between interim rent and the date actually specified in the notice, instead tying interim rent to the earliest date that could have been specified. The intention was to prevent parties from obtaining a tactical advantage by choosing a longer notice period. Reverting to the actual termination date would risk reintroducing those tactical considerations, as parties may seek to influence both the valuation date and the commencement of any revised rent by controlling the timing of their notices.

Option B: retain interim rent but simplify it

Option B would preserve the current structure of the Act, keeping the commencement date and valuation date broadly unchanged, and with interim rent continuing to exist as a separate concept.

However, the basis on which interim rent is assessed would be substantially simplified.

Rather than the current array of different valuation exercises and exceptions, interim rent would be assessed by reference to the open market rent of a hypothetical tenancy on the same terms as the continuation tenancy.

This approach is simpler than the current statutory scheme, and avoids both bringing forward the lease renewal cycle and the need to account for differences between the continuation tenancy and the renewal tenancy.

However, it would not eliminate uncertainty around valuation dates and would continue to allow scope for tactical delay because the renewal rent would still be linked to the timing of the court process.

Application of interim rent in more complex scenarios

The consultation also examines how either option should work where circumstances do not fit the traditional lease renewal model.

For example, issues can arise where the rental model changes on renewal, such as a transition from a conventional rack rent to a turnover rent arrangement. The ability of the court to order a turnover rent is discussed in Chapter 7 of the Consultation and in our article here: Commercial leases: On what terms and rent can a lease be renewed?

The Law Commission recognises the practical difficulties of retrospectively calculating turnover-based rents for periods when tenants may have had no obligation to keep or provide the relevant trading data. Under Option A, the court could be given power to make an appropriate adjustment. Under Option B, interim rent would instead remain based on the rental model used in the original tenancy.

The consultation proposes a similar approach where no renewal tenancy is granted, suggesting that the rent should continue to be assessed using the same rental structure as the original lease.

The Law Commission also seeks views on whether parties should be able to apply for interim adjustments to rent during the continuation period and how balancing payments should be enforced once the final rents have been determined.

Comment

From a corporate occupier perspective, Elinor Sandbach, partner in the real estate litigation team, comments:

“From an occupier perspective, the strongest argument for reform is greater certainty. The current regime can leave occupiers carrying a significant contingent liability for many months while lease renewal proceedings progress, only for a substantial balancing payment to arise long after the relevant period has passed. That uncertainty can make budgeting and financial planning particularly challenging for businesses with large property portfolios.

Option A has obvious attractions because it creates a clear valuation framework from the outset and reduces the scope for tactical delay. However, fixing the valuation date at the notice stage also means that the parties are effectively pricing a lease before the terms have been finalised and, in some cases, before market conditions have fully evolved. In volatile occupational markets, a significant period may elapse between the service of a notice and completion of the renewal lease, creating a risk that the rent ultimately paid is detached from conditions prevailing at the point the new tenancy is actually granted.

Many occupiers may therefore see merit in the simplicity offered by Option B, which preserves the existing renewal timetable whilst streamlining the valuation exercise.”

Laurence Matthews, a Senior Associate in the real estate litigation team who acts for investors and developers, agrees:

“Option A gives both parties greater certainty from the outset, but the trade-off is that it could accelerate the lease renewal cycle. Fixing the valuation and commencement date at an earlier stage means that a lease that takes a year to negotiate may have already lost a substantial part of its term by completion, bringing the next renewal process into view much sooner. While parties may respond by agreeing longer lease terms, that will of itself affect value and, potentially, the new level of rent under the renewal lease."

This article forms part of our series examining the Law Commission's consultation on reform of the Landlord and Tenant Act 1954. Our separate article on Chapter 7 Part 1 considers the Law Commission's proposals regarding the assessment of rent under renewal tenancies.

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Orwell's legacy meets trade mark reality: Why Animal Farm and 1984 could not be protected by trade mark law

Mon, 3 Aug 2026 00:00:00 +0100

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Brand interchange | 3 min read

Orwell's legacy meets trade mark reality

Why Animal Farm and 1984 could not be protected by trade mark law

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Decision: ANIMAL FARM and 1984
Court: EUIPO Grand Board of Appeal
Citation: R1719/2019-G and R1922/2019-G
Decision: Here and here
Key issues: Descriptiveness, distinctiveness

Published: 3 August 2026
Authors: Eloise Di Pasqua

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Introduction

While Animal Farm and 1984 remain two of the most influential literary works ever written, a recent EUIPO Grand Board of Appeal decision demonstrates that fame alone does not guarantee trade mark protection. The ruling provides an important reminder that trade mark law protects indicators of commercial origin, not cultural significance.

Background

The Estate of the late Sonia Brownell Orwell sought to register the titles Animal Farm and 1984 as EU trade marks for a range of goods and services, including books, films, digital content, educational materials, games and entertainment services.

At first glance, the applications may have appeared straightforward. Both titles enjoy worldwide recognition and are intrinsically associated with George Orwell's works. However, the EUIPO examiner partially refused the applications on the basis that the marks were descriptive and lacked distinctive character for many of the goods and services applied for.

The matter ultimately reached the EUIPO Grand Board of Appeal, which was asked to address an important question: can the title of a famous literary work function as a trade mark, or will consumers simply view it as describing the content of the goods and services concerned?

Decision

The Grand Board upheld the refusal to register both marks for a significant number of content-related goods and services.

The Board's key findings included:

Animal Farm and 1984 are widely recognised by the relevant public as the titles of Orwell's novels
where the mark describes its subject matter of the goods and services then it may be liable for refusal under Article 7(1)(c) EUTMR
where goods or services convey creative, educational or entertainment content, literary titles may directly describe that content
copyright ownership, editorial control and licensing arrangements do not determine whether a sign functions as a trade mark; consumer perception remains the decisive test

Importantly, the Board emphasised that there is no blanket prohibition on registering book titles as trade marks. However, exceptionally famous titles may face difficulties where the public primarily associates them with the underlying work rather than with a commercial undertaking.

Commentary

This decision highlights the distinction between copyright and trade mark protection. The Grand Board found that consumers are likely to perceive Animal Farm and 1984 as the titles of famous literary works and as descriptions of their content, rather than as indicators of commercial origin.

The ruling also demonstrates that fame can sometimes hinder, rather than help, trade mark registration. While brand owners often seek widespread recognition, highly famous titles may become so embedded in popular culture that they are no longer perceived as trade marks.

For rights holders, the decision is a reminder that trade mark protection cannot be relied upon simply because a work enjoys significant cultural prominence. The key question remains whether the sign functions as a badge of origin for the relevant goods and services.

Key takeaways

fame alone will not secure trade mark registration and, in some cases, may make registration more difficult where consumers associate the sign with a well-known work rather than a commercial source
the decisive question is how consumers perceive the sign in relation to the relevant goods and services
titles of creative works may be refused registration where they are perceived as describing the content or subject matter of the goods or services
applicants should carefully assess specifications and consider whether the sign will be viewed as a badge of origin, particularly in the publishing, entertainment and educational sectors
evidence of acquired distinctiveness may be important where a title has become culturally ubiquitous.

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What the new Securities Transfer Tax means for equity and incentives

Wed, 29 Jul 2026 00:00:00 +0100

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What the new Securities Transfer Tax means for equity & incentives

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While not directly aimed at employee incentives, the new securities transfer tax marks a significant shift in the way equity is taxed on transfer - impacting option holders, trusts and legal advisers.

Published: 29 July 2026
Authors: Dan Sharman

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HMRC’s much-anticipated overhaul of stamp taxes will introduce a mandatory, self-assessed digital system for securities in 2027. While not directly aimed at employee incentives, the new securities transfer tax marks a significant shift in the way equity is taxed on transfer - impacting option holders, trusts and legal advisers.

The government published draft legislation on 13 July 2026 confirming that the current stamp duty and stamp duty reserve tax regimes will be replaced in 2027 by the Securities Transfer Tax (STT) - a new mandatory, single self-assessed tax on securities.

Now the draft legislation is published we are following up on our previous article (Implications of the Upcoming Changes to the Stamp Taxes Regime on Employee Incentive Arrangements). The key points from our previous article remain the same, which we have set out again below

The introduction of STT signifies HMRC’s ongoing efforts to modernise, simplify and digitalise the UK tax system by allowing taxpayers to use an online portal to pay STT instead of submitting documents to HMRC to ‘stamp’.

Although not directly relevant to employee incentive arrangements, the introduction of the STT may have some interesting consequences for the way employee and manager equity is dealt with.

For clarity, option exercises satisfied by a fresh issue of shares will not attract the STT. However, option exercises satisfied by the transfer of existing shares will be within the scope of the STT.

Key changes under the new STT regime

Key changes affecting employee incentives include the following:

mandatory tax - Unlike stamp duty, the STT will not be a “voluntary tax” and the buyer (which could include new joiners or option holders exercising their options) will be liable for paying it
digitalisation - The reporting and payment of the STT will be fully digitalised. Further detail of the proposed online portal is awaited but it is anticipated that confirmation of the transaction will be generated immediately on the reporting and payment of the STT. This should permit the company registrar to write up the register of members simultaneously
accountable person - The buyer will be liable for the tax, but the online portal will also allow agents, such as legal advisers and accountants, to register as the "accountable person" for paying the tax on behalf of the buyer. An accountable person will be liable for the STT on a joint and several basis with the buyer, unless HMRC are satisfied that the accountable person took all reasonable steps, both before and after the transaction, to recover the tax from the buyer. Clear procedures and evidence trails will be important and legal advisers may be reluctant to assume this role
removal of the £1,000 de minimis exemption - The £1,000 de minimis exemption (treating transactions with consideration of less than £1,000 as exempt from stamp duty) will be removed. HMRC’s policy aim is to offset the additional compliance burden through a fully digital reporting and payment process. HMRC had previously indicated that the portal would generate a UTRN/transaction confirmation on submission, which should enable registrars to update the register of members more quickly, although further detail on the portal is still awaited
late notification penalties - Late notification penalties will be changed to a percentage-based regime.

Benefits of STT for share plans

The STT aims to modernise the method of paying tax on the transfer of shares, through a digitalised system, similar to that currently used to pay Stamp Duty Land Tax. Whilst the details of the reporting process are awaited, it is hoped that the digitalisation will facilitate same-day registrations. There should be no need to enter into declarations of trust (to transfer the beneficial interest in shares) where there is insufficient time to receive an authentication code from HMRC (e.g. where options are exercised on the same day as completion of a sale of the relevant option shares).

Potential challenges for share plans

The main challenges will arise from the removal of the £1,000 de minimis exemption that currently exists for stamp duty. Under existing rules, transfers of shares for consideration of £1,000 or less are exempt, meaning low-value option exercises do not attract stamp duty. However, under the proposed STT rules, share transfers effected for value will be subject to the STT, irrespective of the amount of consideration. Accordingly, all in-scope transfers will need to be reported and the STT paid. While it is hoped that the portal will remove the need for a stock transfer form to be produced and will simplify the current ‘stamping’ process, the STT will create an additional burden for buyers of shares, certain option holders and employee benefit trusts (EBTs) regularly involved in transferring shares to employees, where the small value transfers are currently exempt from stamp duty.

Option holders will be personally liable to pay any STT whenever they exercise their options (assuming those options are satisfied by a transfer of existing shares). any such exercise will incur the STT and this must be paid by the ‘buyer’, but not necessarily the option holder, before completion. A cashless exercise may, therefore, result in the corporate ‘buyer’ being liable for the STT rather than the option holders. This would greatly simplify any option exercise process immediately prior to completion. The alternative would be for legal advisers to be authorised by the option holders to pay stamp duty on their behalf. This would likely result in the adviser being an ‘accountable person’, where an accountable person will be jointly and severally liable for the STT.

Option holders will be personally liable to pay the STT where relevant, whatever the consideration. Where an M&A transaction requires the exercise of options prior to completion (where options are satisfied by the transfer of shares rather than an issue of new shares), any such exercise will incur the STT and this must be paid by the option holder before completion. Any adviser will be familiar with the potential difficulties of arranging for multiple option holders to sign option documents, often in short timeframes. Therefore, to streamline the STT process prior to completion, legal advisers may need to be authorised by the option holders to pay STT on their behalf. With this in mind, effective wording should be built into the option exercise documents to grant such authority and avoid potential delays to the transaction. A point to watch is the draft definition of ‘buyer’, which refers to the person by whom the consideration for the transfer is payable and may differ from the transferee. We will await further guidance from HMRC as to how this might apply in practice.

The change from a “voluntary” tax to a mandatory tax, with the purchaser liable to pay, also adds a cost to employees participating in equity incentive arrangements which historically have often been borne by the company setting up the arrangements. Going forward, it seems that if a company wants to cover this cost for its participating employees, it will need to “gross up” the tax as it will be paying the employee’s tax liability on their behalf (which is considered a taxable benefit under general tax principles).

What should businesses do now?

Companies operating share plans should start identifying where and when the STT may arise and consider what process changes may be needed. In particular, they should:

review option exercise processes where awards are satisfied by transfers of existing shares
consider whether option exercise documents should provide for the delegation of authority for payment/reporting of the STT
review EBT transfer processes and who will be responsible for any STT reporting and payment
monitor the progress of the draft legislation and HMRC guidance, seeking specialist tax and incentives advice where needed.

Conclusion

The publication of draft legislation is a significant step towards the modernisation of the UK’s stamp taxes regime. Overall, the new digital streamlined processes should generally reduce the time, administrative burden and associated costs for companies implementing share plans, though companies will need to factor in STT costs for lower-value transactions that would currently be exempt. The digital process may make routine filings more straightforward, but businesses will still need controls to ensure STT is identified, reported and paid on time for every share transfer to avoid penalties accruing.

For further advice please contact Dan Sharman dan.sharman@shoosmiths.com or Laura Gould laura.gould@shoosmiths.com

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Securities Transfer Tax: stamp duty (finally) enters the digital age

Wed, 29 Jul 2026 00:00:00 +0100

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Securities Transfer Tax: stamp duty (finally) enters the digital age

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The Securities Transfer Tax (STT) should make routine share transfers faster and cleaner, turning a historic ‘voluntary’ documentary tax into a mandatory self-assessment regime.

Published: 29 July 2026
Authors: Daniel Kennedy

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The Securities Transfer Tax (STT) should make routine share transfers faster and cleaner, turning a historic ‘voluntary’ documentary tax into a mandatory self-assessment regime with filing obligations, amendment mechanics, repayment rules and percentage-based penalties.

On 13 July 2026, the government published draft legislation for a new Securities Transfer Tax (STT).The new tax is intended to replace both ad valorem stamp duty and stamp duty reserve tax (SDRT) from 2027, bringing the UK’s share transfer taxes into a single digital, self-assessed regime. Comments on the draft are invited by 7 September 2026, with legislation expected to be included in Finance Bill 2027 with the new tax to take effect in Autumn 2027.

Stamp duty is an archaic tax on documents, while SDRT taxes agreements to transfer chargeable securities (with no requirement for agreements to be in writing). The overlap between the two can be awkward in practice, as the two taxes don’t always dovetail. The STT is designed to replace the fragmented two-tax framework with a single online process, immediate acknowledgement and a tax charge that is triggered by the transaction rather than a document.

0.5% charge on consideration in money or money’s worth

The STT will apply when a person agrees to transfer 'chargeable securities' for consideration in money or money's worth. Chargeable securities will include shares and equity-like debt interests in UK incorporated companies, and units in certain unit trust schemes, together with certain related interests, options and subscription rights. The main rate of the STT will be 0.5% of the consideration, in money or money’s worth, with the charge arising on an agreement to transfer chargeable securities rather than on a stamped instrument.

The concept of chargeable consideration is much broader than under ad valorem stamp duty where the tax only attached to certain types of consideration. One significant question which has arisen is whether the broadening of the concept of ‘chargeable consideration’ means that tax will be payable by reference to the buyer being obligated to procure that the target company being purchased repays debt on completion (a common and well established means of structuring purchases which minimizes the amount of stamp duty payable) and, if this is now seen as chargeable consideration, how does one value that act of procuring?

The ‘buyer’ will be liable to pay the tax. The draft legislation defines the ‘buyer’ as the person by whom the consideration for the transfer is payable and makes it clear that the buyer may differ from the transferee.

Removal of £1,000 de minimis

The draft legislation removes the £1,000 de minimis exemption (treating transactions with consideration of less than £1,000 as exempt from stamp duty). So smaller transfers, eg from minority shareholders, regardless of the consideration, will come within charge, assuming the draft legislation is enacted in its current form.

Stamp duty is currently rounded up to the nearest £5. The STT will not follow this approach and amounts of STT that are payable shall be rounded to the nearest whole penny.

This brings into charge a very large number of transactions that have previously been outside of the scope of the old regime by reason of falling below the £1,000 threshold. This creates a significant administrative burden in connection with what are low value transactions.

Equity incentives

In particular, the removal of the £1,000 de minimis will result in additional tax obligations for option holders who exercise their options in exchange for existing shares that are transferred to them, as well as for employee benefit trusts involved in transferring shares to employees, where the low levels of consideration currently don’t attract stamp duty.

Option holders will be personally liable to pay any STT whenever they exercise their options (assuming those options are satisfied by a transfer of existing shares). Where an M&A transaction requires the exercise of options prior to completion (where options are satisfied by the transfer of shares rather than an issue of new shares), any such exercise will incur the STT and this must be paid by the ‘buyer’, ordinarily the option holder, before completion.

A cashless exercise may, therefore, result in the corporate ‘buyer’ being liable for the STT rather than the option holders. This would greatly simplify any option exercise process immediately prior to completion. The alternative would be for legal advisers to be authorised by the option holders to pay stamp duty on their behalf. This would likely result in the adviser being an ‘accountable person’, where an accountable person will be jointly and severally liable for the STT. Legal advisers may therefore be reticent to fulfil this role.

Our more detailed article ‘What the new Securities Transfer Tax means for equity and incentives’ can be found here.

Same-day registration

Companies will still be restricted from registering certain transfers in the statutory books of the company unless they have evidence that the STT has been paid. However, taxpayers will now file and pay through an online process rather than needing to wait for a stamped stock transfer form. This should enable same-day registration of legal title and will expedite the writing-up of the register of members post-completion. This will be particularly beneficial in the context of pre-sale reorganisations where delays in stamping stock transfer forms currently create friction.

‘Substantial completion’ for shares

One feature of the draft regime is the importation of SDLT-style timing concepts. Under the proposed rules, the STT can arise on the earlier of completion and ‘substantial completion’. The policy objective is clear: where the buyer has obtained the economic benefits of ownership, the tax charge should not be delayed simply because the contract has not technically completed.

This will require consideration where exchange and completion are not simultaneous, completion is conditional and/or where shares/rights are transferred in stages. Advisers will need to focus on when the buyer has, in substance, received the benefits and burdens of ownership - for example voting rights, dividend entitlement, control over the shares or the ability to direct their sale. Although the concept is familiar from land transactions, its specific application to securities will benefit from HMRC guidance.

Contingent, uncertain and deferred consideration

The draft rules should produce a fairer outcome for consideration that is deferred, contingent or unknown at completion. Under the current stamp duty rules, duty is generally calculated once and for all by reference to the consideration known, or capable of being ascertained, when the instrument is executed. Where the consideration is contingent, the ‘contingency principle’ can require duty to be calculated on the assumption that the contingency will occur, even if the amount is never ultimately paid. Conversely, genuinely unascertainable consideration may fall outside stamp duty altogether. Very often this results in tax being paid by reference to a value which does not match the actual consideration eventually paid by the buyer.

The draft STT legislation provides that if the amount of consideration is unknown, the buyer is expected to make a reasonable estimate and pay tax on that basis. If the consideration is uncertain, it may be possible to defer payment in respect of the uncertain amount. Once the final amount becomes known, the STT can be recalculated and any additional tax paid or overpayment reclaimed. It is noted that this requires buyers to continue to monitor the stamp duty position after completion (in contrast to the ‘once and for all’ approach under ad valorem stamp duty). Interest will accrue where tax is not paid within the initial 30-day payment window, so buyers will need to take this into account when calculating any reasonable estimates and eventually settling the final tax amount.

Reliefs, reorganisations and partnership structures

Group relief, reconstructions and acquisitions relief, intermediary relief and the ‘growth market’ exemption will continue to be available under the STT. Share buybacks will be treated in the same way under the STT as under the existing rules.

The draft provisions for group relief include restrictions (as they do for stamp duty) where arrangements involve third parties, and further guidance may be needed on how those rules apply where bank funding is used in a group reorganisation.

Transfers of partnership interests are excluded from the STT, however the draft legislation does include a targeted anti-avoidance provision, to prevent partnership arrangements being used to transfer economic ownership of shares without a charge.

Practical implications for transactions

The reforms should reduce delays, especially where parties currently wait for HMRC stamping confirmation before updating the register of members. At the same time, the introduction of the STT will require advisers to consider:

whether the tax point could arise before formal completion of the share transfer because of substantial completion
who is responsible for filing, payment and dealing with any shortfall or overpayment
how deferred, earn-out or completion accounts consideration will be estimated, trued up and/or deferred
what evidence is needed for reliefs and exemptions, and when it must be available
whether transaction documents should include specific STT covenants/indemnities/warranties, undertakings and information rights
how to manage small transfers that previously relied on the £1,000 stamp duty de minimis, which will now require returns to be made.

Final thoughts

The STT should simplify the UK’s share transfer tax regime. It replaces an anachronistic documentary tax with a single digital charge, removes much of the stamp duty/SDRT overlap and should make registration of legal title faster in routine transactions. It should result in fairer calculations of tax and avoid the current situations where the tax is levied by reference to a different value than the consideration actually provided for the shares (which can work both for and against the taxpayer). However, the removal of the £1,000 de minimis will increase reporting obligations and may complicate some completion processes where there are multiple option holders and/or minority shareholders. We expect there to be considerable lobbying for the threshold to be re-applied ahead of the introduction of the tax in Autumn 2027.

For further advice please contact your usual Shoosmiths contact.

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Shoosmiths advises Atlas Health Capital on investment in AGB-Pharma

Wed, 29 Jul 2026 00:00:00 +0100

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Shoosmiths advises Atlas Health Capital on investment in AGB-Pharma

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Shoosmiths has advised Atlas Health Capital on the acquisition of AGB-Pharma, a specialist pharmaceutical company focused on supporting patients living with sleep disorders.

Published: 29 July 2026

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The investment is being made through Atlas Health Fund I, which was raised in early 2026 and attracted strong investor demand. The transaction will support AGB-Pharma's next phase of growth, including international expansion and the development of its product portfolio.

The Shoosmiths corporate team was led by partner Tim Nye, supported by partner Alison Chivers, principle associates Alice Richmond and Brodie Thomson and associate Jessica Pearson.

Founded in Lund, Sweden, in 2020, AGB-Pharma has rapidly established itself as a leading player in its specialist field. The company is focused on improving outcomes for patients living with sleep disorders and has developed a strong reputation for innovation and patient-centred care.

Atlas Health Capital invests in European mid-market healthcare businesses across the MedTech, niche pharmaceutical and animal health sectors. Through its Anchor, Expand, Accelerate value creation framework, the firm partners with management teams to drive sustainable growth and long-term value creation.

Commenting on the transaction, Ben Long, Founder and Managing Partner of Atlas Health Capital, said:

"AGB-Pharma is exactly the type of specialist healthcare business we established Atlas to support. I am full of admiration for what Stig, founder of AGB-Pharma AB, and his team have achieved. We look forward to working closely with the management team to invest in the business, broaden its capabilities to support more patients and build on the strong foundation the team has laid."

“I would also like to thank the Shoosmiths team for their pragmatic and commercial support throughout the transaction, which has been invaluable in helping us successfully reach this milestone.”

Stig Henningsson, founder of AGB-Pharma AB, added:

"I am particularly proud that AGB-Pharma became the first pharmaceutical company in the world to have Melatonin AGB approved in Sweden for the treatment of children with insomnia and ADHD. I now leave the company in the capable hands of the management team and Atlas, so they can continue the company's mission of improving sleep quality."

Tim Nye, partner in Shoosmiths’ corporate team, said:

"We are delighted to have supported Atlas Health Capital on this investment in AGB-Pharma. The transaction reflects continued investor confidence in high-quality specialist healthcare businesses that combine innovative products, strong management teams and clear opportunities for growth. AGB-Pharma has established a compelling position in an important area of patient care, and we look forward to seeing the business continue its development with the support of Atlas."

The financial terms of the transaction were not disclosed. Completion remains subject to customary regulatory approvals.

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AI-generated workplace disputes: Burden or opportunity?

Mon, 27 Jul 2026 00:00:00 +0100

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AI-generated workplace disputes: Burden or opportunity?

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AI is changing how employment disputes are raised and pursued. We look at the practical steps employers can take to cut through the noise and deal with AI-generated disputes proportionately.

Published: 27 July 2026
Authors: Darlia Williams

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Employees can now use free online tools to generate detailed grievances, tribunal pleadings, correspondence and broad data subject access requests in minutes. While that can help employees articulate their concerns clearly, it can also add complexity to the issues and bring in arguments that may not be legally correct. As a result, it means employers are receiving lengthy, legalistic documents from employees whose expectations for resolution may be shaped by AI, rather than qualified legal advisers. Given AI’s propensity to agree with the prompter, an employee’s expectations can be inflated without having an actual legal basis, making resolution of the issue more difficult.

For employers, this creates both burden and opportunity: more material to manage and more time and cost involved in dealing with disputes, but also more scope to narrow the issues, test the evidence and focus on the facts.

Practical steps for employers

Speak to the employee, not the document

One of the weaknesses of AI produced content is that it is only as good as the prompt and information provided to it. Where an employee gives an incomplete or one-sided account, the AI output is likely to amplify their perspective and present it in a more persuasive and often lengthy form.

For employers, a meeting, whether in person or online, will often be the quickest way to understand what the employee is really saying. It allows the employer to ask the employee to explain their concerns in their own words, identify the facts they rely on and clarify what outcome they want. In practice, employers should ask: what happened, who was involved, when did it occur, what evidence is available and what outcome is the employee seeking? The discussion should be documented carefully and used to define the scope of any investigation.

Follow the process

The ACAS Code of Practice on disciplinary and grievance procedures remains the minimum standard employers should follow when handling workplace issues. In AI-assisted disputes, that discipline matters even more. It gives employers a structure for dealing with lengthy correspondence: follow internal policies, keep clear records, investigate reasonably and communicate outcomes proportionately.

Don’t match volume with volume

Employers should not assume that a document is stronger because it is longer, or more persuasive because it cites legislation or case law. AI generated content may look daunting at first glance, but it can also reveal weaknesses in the employee’s case: missing dates, vague allegations, unsupported assumptions or legal points that do not match the facts or which are, in fact, incorrect. Employers should avoid validating inaccurate AI generated content and do not necessarily need to respond line by line to every aspect. A better approach is to identify the core allegations, investigate them properly and explain the outcome clearly.

Employers should also resist being pulled into legal arguments with employees. An employer’s role is not to debate the law or provide legal commentary; it is to understand the factual complaint, reach a sensible conclusion and decide what, if any, action should be taken. Where a grievance cites case law or legal principles, the employer can say that it has considered the points raised but has focused its investigation on the underlying factual concerns.

Put clear guardrails around AI use

Employers should consider introducing or updating an AI policy. This should explain:

when employees may use AI tools
whether tools should be limited to company approved ones only rather than publicly available tools
what information must not be entered into public AI platforms in any circumstances
the need for employees to check accuracy before relying on AI generated content and
potential confidentiality, data protection and privilege risks.

A clear policy will not prevent every issue, but it should give employers a framework for managing AI use consistently and help identify where a breach of confidentiality or data protection has occurred for which disciplinary action against an employee may then be taken.

AI in the employment tribunal

AI is also making employment tribunal claims harder to manage and settle. Employees who rely on AI for an assessment of their claim may receive a confident, claimant-friendly output as well as suggested legal arguments, strategy and an overinflated estimation of the claim value. This can reinforce the claimant’s view of their case and entrench their position, particularly where the output has not been checked by a legal adviser.

For employers, this means receipt of more claims, more complexity, more ambitious applications and difficult settlement discussions. However, AI generated content often contains factual errors, incorrect case law, misconceived claims and disproportionately lengthy correspondence. This is where employers may have an opportunity. The Employment Tribunal may strike out misconceived claims and, whilst cost awards remain relatively rare, may award costs where an employee pursues meritless claims or otherwise acts vexatiously or unreasonably during proceedings by generating excessive correspondence.

AI use may also create targeted disclosure opportunities. Where employees use AI to generate content related to their dispute, the AI prompts used and their output may not be legally privileged and therefore may be disclosable in Employment Tribunal litigation. Employer requests for disclosure about AI use should however be targeted, proportionate and linked to the issues in dispute. They should not be used as a fishing expedition or as a substitute for engaging with the merits of the claim. The same point cuts both ways: if an employer has used AI in preparing correspondence, pleadings or evidence, it should be ready to explain and justify that use if challenged and ensure that all aspects are checked and accurate.

Key takeaway

AI is not going away. Employers should expect more lengthy grievances, more legalistic correspondence and more AI assisted tribunal claims. The answer is not to match volume with volume, or to treat every AI generated point as equally important. Instead, employers should keep the process disciplined: speak to employees directly, focus on the facts, comply with the ACAS Code and their internal policies, keep clear records and respond in a way that is proportionate, accurate and commercially sensible.

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Less healthy foods: What are the key lessons from the ASA’s rulings?

Mon, 27 Jul 2026 00:00:00 +0100

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Less healthy foods: What are the key lessons from the ASA’s rulings?

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In July 2026, the Advertising Standards Authority (ASA) published six rulings considering whether the restrictions on the advertising of less healthy foods and drinks (LHF) had been breached.

Published: 27 July 2026
Authors: Adam Flynn

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This article summarises the key takeaways from those rulings and earlier 2026 decisions. For background on the LHF restrictions, see our previous articles (here and here).

Ads depicting unidentified non-LHF products are not safe

The four July 2026 rulings which were not upheld concerned paid-for online ads for promotions or offers, such as ‘pizza from only £10’ or a ‘double deal’. Each ad showed non-prepacked food, but none of the ads specifically named or otherwise identified the product shown.

In each ruling, the ASA reiterated that brand ads (i.e. ads that promoted a brand, including the brand of a range) are exempt from the restrictions. The ASA considered three scenarios to decide whether the ads breached the restrictions or fell within the brand-advertising exemption. The three scenarios the ASA worked through were as follows:

an ad depicting a specific LHF sold by the advertiser would breach the restrictions
an ad depicting and clearly identifying a specific non-LHF sold by the advertiser would not breach the restrictions
if a realistic product image is shown but the product is not identified, the ASA will assess whether that product is visually indistinguishable from any LHF sold by the advertiser. If it was visually indistinguishable from an LHF, the ad would be in breach.

By way of example, if a non-LHF burger was shown in an ad but was not identified (i.e. the non-LHF burger was not explicitly named), the ad would breach the restrictions if that non-LHF burger was indistinguishable from another of the advertiser’s burgers, which was LHF.

Because all the ads featured non-LHF products, scenario 1 did not apply. However, as the products were depicted but not identified in the ads, scenario 2 was not satisfied, and the ASA moved to consider scenario 3.

Under scenario 3, the ASA will scrutinise the advertiser's wider product range to determine whether any LHF is visually indistinguishable from the unidentified product shown. It is therefore not enough that the product shown in an ad is non-LHF: if it is visually indistinguishable from a specific LHF sold by the advertiser, the ad will likely be restricted.

The practical lesson is clear: where a specific product is shown, identify it in the ad. If this is not done, the ASA may compare it against the advertiser's wider menu or product range, including relatively minor features and variants such as ingredients, filings, and toppings, to assess whether the depicted non-LHF product is visually indistinguishable from an LHF.

Brand characters are off limits if they are synonymous with an LHF

Advertisers should not assume that the use of brand characters will be exempt. In one ruling, the ASA undertook a detailed analysis of the character's shape, colour and relationship to the advertiser's product range before concluding that one of the characters used in the ad was synonymous with a specific LHF product. This shows that the ASA will scrutinise whether consumers are likely to associate a character with a particular LHF. Where a character has become closely linked to a specific product variant, its use will likely bring an ad within the scope of the restrictions.

Food being prepared will be analysed by the ASA

In one ruling, the ASA rejected the advertiser's argument that food shown during the preparation phase should fall outside the scope of the visual indistinguishability test. In the ad, chicken pieces were shown frying in oil. The ASA considered that, apart from needing to be removed from oil, the product appeared as it would when served, and that the final served product was one which was capable of being purchased. As such, the ASA analysed whether the product shown was visually indistinguishable from any LHF sold by the advertiser. On this occasion, the products were not visually indistinguishable from any specific LHF. This led the ASA to conclude the ads were brand advertisements and were therefore out of scope of the LHF rules.

All advertisers need to be aware of the restrictions

The restrictions are not confined to food and drink manufacturers or retailers. In one ruling published in July 2026, the ASA considered an ad by a food delivery platform that did not sell its own food or drink. In another, the ASA expressly reminded advertisers that the legislation does not limit its application to businesses involved in the manufacture or sale of food and drink.

The key question is therefore not the nature of the advertiser's business, but whether consumers could reasonably identify the ad as being for an LHF.

Franchisees are treated as part of the franchisor

Food or drink SMEs (i.e. businesses that employ fewer than 250 people) are exempt from the LHF restrictions. Whilst this is made clear in both the legislation underpinning the restrictions and Advertising Guidance, the ASA has in two separate rulings reminded advertisers that franchisees are treated as part of the business of the franchisor for the purposes of calculating the number of employees.

Incidental products are not restricted

In April 2026, the ASA determined that an identifiable product on the edge of an Instagram ad’s frame which moved in and out of the shot as the camera moved, was not referenced by the central protagonist and, which was only shown when the viewer’s attention would be elsewhere, was incidental. The ASA determined that consumers could not reasonably be expected to identify the ad as for that product, and as such, its use was not restricted.

The ASA reached the same decision for another identifiable product which was not mentioned in a voice-over, and which was only included in a brief shot where the movement of the camera would direct the viewer’s attention elsewhere.

What should I do now?

Advertisers should continue to review paid-for online ads carefully before publication, particularly where food or drink products or brand characters appear. If a non-LHF product is shown, it should be clearly identified in the ad.

If you require any support with your marketing compliance, please do reach out to Adam Flynn and Stephen Johnstone at Shoosmiths.

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Commercial leases: A cautious approach to 1954 Act reform

Thu, 23 Jul 2026 00:00:00 +0100

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Commercial leases: A cautious approach to 1954 Act reform

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Although the Law Commission has proposed changes in some areas of commercial leasehold law, in other areas it is more cautious about making changes.

Published: 23 July 2026
Authors: Michael Callaghan

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Introduction

The Law Commission’s consultation on the Landlord and Tenant Act 1954 (1954 Act), which underpins the law for business tenancies, proposes several significant changes to the 1954 Act. We have focused on a number of these in other articles in this series. However, where changes would overlap with other areas of law, the Law Commission has taken a more conservative and cautious approach to law reform.

Registration gap

The registration gap arises where a property is transferred, but the buyer is not yet registered at HM Land Registry. Legal title remains with the seller, while the buyer holds the beneficial interest. During this period, notices must be served by or on the legal owner, not by or on the new owner. The issue affects both landlords who sell their title and tenants who assign their leases.

The Law Commission’s preferred option is to maintain the current law to ensure that the treatment of the registration gap under the 1954 Act is broadly consistent with other statutory and common law notice requirements. It believes that the difficulties that the registration gap creates, and the way in which those issues are managed by the parties or their representatives, are generally well understood.

Notably, the Law Commission says that there are questions about establishing the grounds for possession where the legal landlord serves a notice opposing the renewal of a tenancy on redevelopment or occupation grounds but the new owner is the person who will redevelop or occupy. However, it does not explore these further or suggest solutions to these questions. This is a missed opportunity to clarify the law.

Occupation by linked parties

For a tenant to benefit from the protection of the 1954 Act, it must be in occupation of premises for the purposes of a business. In modern structures the “tenant entity” may differ from the “occupying entity”. Although there are existing statutory relaxations applying to group companies and trusts, they do not benefit public sector bodies or other arrangements. The Law Commission does not propose immediate reform. Instead, it specifically asks whether occupation by “government bodies” should be treated like group companies and trusts. In effect this would mean that occupation by one government body should constitute occupation of the tenant in circumstances where the tenant is a different government body.

Occupation requirement

Some business tenants may not be able to benefit from the protection of the 1954 Act where their businesses consist of granting rights of occupation of the premises to others as they are not then in occupation of the premises themselves. Typical examples include business tenants that run mobile home sites, and operators of serviced apartments and serviced offices. Similar difficulties might also arise for companies that operate a franchise business model, where the franchisor owns a business tenancy of premises that are occupied by the franchisee.

The Law Commission is cautious about reforming the “occupation” rule and widening it to “using the premises” for the purposes of a business. Such an approach would, it believes, risk unravelling a key principle underpinning the 1954 Act. It is therefore asking for further evidence about the extent to which the “occupation” rule causes difficulties in practice that should be addressed through reform.

Contractual break clauses

If a landlord has a contractual break clause in a protected tenancy, it must not only comply with the contractual obligations in the lease but also comply with the statutory requirements of the 1954 Act to oppose the grant of a new tenancy. It has been suggested that where the parties have agreed to the inclusion of a contractual break clause within a protected tenancy, the landlord should be able to exercise the break without having to oppose the grant of a renewal tenancy under the 1954 Act.

The Law Commission considers that the current law is right. Allowing landlords to terminate a protected tenancy simply by exercising a contractual break clause would risk substantially undermining the protection offered to tenants under the 1954 Act.

Large-scale and complex redevelopments

Where a landlord plans a large-scale or complex redevelopment, a landlord may not be able to satisfy the redevelopment ground to regain occupation. Where extensive works are planned to a wider property, the impact of that work specifically on the tenant’s premises may be relatively minor, or non-existent. However, there could be potentially significant risks or logistical difficulties in undertaking wider redevelopment works with the tenant in situ that might make redevelopment of the wider property prohibitively costly, difficult or dangerous.

The Law Commission has considered whether the redevelopment ground should be amended, or a new ground of opposition created, to enable a court to consider a landlord’s wider works. However, it has concluded that this expansion would represent a significant change to the 1954 Act and should not be implemented. It believes that although there are challenges that are caused by the 1954 Act, there is no evidence those challenges hold back large-scale and complex developments. Nevertheless, it invites consultees’ views regarding any specific challenges that are encountered in large-scale or complex developments, and about any amendments to the 1954 Act that are required to resolve them.

The interaction between MEES and the 1954 Act

The Law Commission discusses the obligations in the MEES Regime (in particular, the duty not to let, or continue to let, “sub-standard” property) and the security of tenure regime under the 1954 Act (which obliges landlords to re-let a property to existing business tenants). Which regime takes priority?

The Law Commission notes that there is a temporary exemption to “postpone” compliance with MEES by six months on the grant of a renewal tenancy pursuant to the 1954 Act and that the consent exemption may also apply. It therefore considers that, in principle, these exemptions mean that the 1954 Act does not itself present compliance issues with the MEES regime.

However, the Law Commission acknowledges that there is a lack of clarity about how the exemptions operate in practice. For example, it is unclear whether a negotiated renewal of a protected tenancy, concluded without the service of a section 25 or section 26 notice (or issuing court proceedings), constitutes a “renewal pursuant to the 1954 Act” for the purposes of the temporary exemption under the MEES regime. However, to the extent that this is an issue with the MEES regime, it is outside the scope of the Law Commission’s consideration of the 1954 Act.

The Law Commission asks for evidence of any practical difficulties in relation to the “conflict” between MEES and the 1954 Act.

What next?

As ever, it is important to remember that this is, for now, only a consultation. Any views provided in response will form the basis of recommendations by the Law Commission. It will then be for government to choose how to implement (or not) those recommendations in order to reform the landscape for commercial landlord and tenant relationships.

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AI in the workplace: Key takeaways from London Tech Week for employers

Tue, 21 Jul 2026 00:00:00 +0100

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AI in the workplace: Key takeaways from London Tech Week for employers

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Artificial intelligence continues to dominate boardroom discussions, but many organisations are now moving beyond the question of whether to use AI and focusing instead on how to implement it effectively.

Published: 21 July 2026
Authors: Jo Tunnicliff

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Artificial intelligence continues to dominate boardroom discussions, but many organisations are now moving beyond the question of whether to use AI and focusing instead on how to implement it effectively. Several sessions at London Tech Week highlighted a common theme: the success of AI adoption is increasingly dependent on people, rather than technology alone. Here are some of our key takeaways for employers.

AI adoption starts with people

One discussion explored how organisations can secure workforce buy-in for AI transformation. Businesses are recognising that successful implementation requires more than investing in technology; it requires engaging employees, building trust and equipping staff with the skills and confidence needed to use AI effectively. Organisations that involve employees early in the process and clearly communicate the benefits of AI are often better placed to realise the productivity and innovation gains these tools can offer.

Another session focused on the results of a major workforce survey examining employee attitudes towards AI. A key takeaway was that whilst enthusiasm for AI is growing, many employees still have concerns about job security, transparency and the impact of AI on decision-making. Employers therefore need to balance innovation with appropriate governance, training and communication strategies.

Balancing innovation with accountability

The legal implications of AI adoption were also a prominent topic. As organisations integrate AI into recruitment, performance management and day-to-day operations, they must consider issues such as discrimination risks, data protection compliance, intellectual property ownership and accountability for AI-assisted decisions. Regulators are increasingly focused on these areas, making robust governance frameworks essential.

For employers, the challenge is no longer simply implementing AI tools but ensuring they are introduced responsibly and effectively. This requires a combination of legal compliance, clear policies, workforce engagement and ongoing oversight.

For HR and leadership teams, the message from London Tech Week was clear: organisations that place equal emphasis on technology, governance and people are likely to be best positioned to maximise the opportunities presented by AI while managing the associated risks. AI transformation is ultimately a people change programme as much as it is a technology project.

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What does the UK’s approach to tackling deforestation mean for your business?

Tue, 21 Jul 2026 00:00:00 +0100

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The UK’s approach to tackling deforestation

What it means for your business

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The UK Government has announced a strengthening of its approach to tackling global deforestation risk in UK businesses’ supply chains and has set out new proposals to ‘further decouple UK consumption from global deforestation’.

Published: 21 July 2026
Authors: Angus Evers

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What has the government proposed previously?

The Environment Act 2021 contains powers for the government to introduce regulations restricting the use by UK companies of ‘forest risk commodities’ in commercial activity. The previous Conservative government consulted in early 2022 on prohibiting larger businesses operating in the UK from using commodities including cattle (beef and leather), cocoa, coffee, maize, rubber, soy and palm oil grown on illegally deforested land. Those businesses would be required to publish information obtained through due diligence into their supply chains, identifying where any ‘forest risk commodities’ they placed on the UK market came from.

Despite the EU adopting a Regulation on Deforestation-free Products in 2023 (which applies in Northern Ireland), the UK Government has not taken the proposals it consulted on in 2022 forward – until now.

What is the government proposing now?

One of the last policy proposals of the Labour government led by Sir Keir Starmer was to publish a policy paper on the UK’s approach to deforestation regulations. The policy paper states that the government aims to introduce regulations, including under the Environment Act 2021, alongside legislation that will strengthen the UK Timber Regulation.

At the core of the proposals is an obligation for qualifying businesses that use forest risk commodities and wood products to carry out due diligence to ensure these are produced in compliance with relevant local laws. According to the policy paper, businesses will need to establish a due diligence system, report on their activity and be able to evidence their compliance by collecting geolocation data on the origin of the specific products.

The measures are designed to strengthen the UK’s approach to tackling illegal deforestation, although the policy paper also states an ambition to transition to a deforestation-free standard, such as the one in the EU Regulation on Deforestation-free Products (EUDR), in due course.

The policy paper indicates that the information requirements under the GB regime will align with what is needed for a due diligence statement under the EUDR when exporting to the EU or moving goods from Great Britain to Northern Ireland.

Which commodities will be caught?

The requirements are intended to apply to the same commodities as the EUDR - namely wood, cattle, cocoa, coffee, palm oil, rubber, soy and certain derived products (e.g. chocolate and furniture).

Which businesses will be caught?

Businesses in Great Britain that trade in forest risk commodities and wood products, and that have an annual turnover of more than £1 million will be required to comply with the due diligence requirements. However, GB businesses with an annual turnover below £1 million that export goods to the EU or Northern Ireland will still need to comply with the EUDR, as there is no turnover threshold under the EUDR.

How will the GB regime interact with the EUDR?

The government has also committed to ensuring the measures will operate consistently alongside the EUDR, to protect the UK internal market and support export-led growth. It remains to be seen how this will work in practice, as whilst the proposed GB regime is concerned with illegal deforestation, the EUDR is concerned with any form of deforestation (including legal deforestation).

The EUDR will continue to apply in Northern Ireland to ensure that Northern Ireland’s unique access to the EU single market is maintained.

What happens next?

The Labour government led by Sir Keir Starmer issued the policy paper and it is too early to tell whether the new Labour government led by Andy Burnham will take forward the proposals. Assuming it does, there will be a consultation on the proposals later in 2026, with a view to introducing regulations in 2027. The regulations will include provisions on enforcement and civil sanctions.

Large and medium-sized UK businesses operating within the EU or placing relevant products on the EU or Northern Ireland markets must comply with the EUDR from 30 December 2026. Micro and small UK businesses operating within the EU or placing relevant products on the EU or Northern Ireland markets must comply with the EUDR from 30 December 2026 for wood products currently regulated under the EU Timber Regulation and from 30 June 2027 for all other relevant products.

UK businesses that may be affected by the proposals should maintain a watching brief and wait for the anticipated consultation later in 2026. As a preliminary step it may also be prudent to begin mapping and assessing supply chains to identify commodities and products that are likely to trigger due diligence requirements.

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easyGroup v Easyfeetstore: How far does a “family of marks” really extend?

Fri, 17 Jul 2026 00:00:00 +0100

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Brand interchange | 4 min read

easyGroup v Easyfeetstore

How far does a “family of marks” really extend?

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Decision: easyGroup v Easyfeetstore [2026] EWHC 767 (IPEC)
Court: Intellectual Property Enterprise Court (IPEC)
Judge: HHJ Hacon
Decision: Here
Key issues: Family of marks

Published: 17 July 2026
Authors: Ellen Hughes-Jones

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Introduction

The Intellectual Property Enterprise Court has handed down an important decision on the limits of the “family of marks” doctrine in easyGroup v Easyfeetstore. The judgment will be of particular interest to brand owners that manage portfolios of marks sharing a common prefix or naming convention, and to businesses facing claims based on alleged brand ‘families’.

At the heart of the dispute was a question that has surfaced repeatedly in easyGroup litigation over the years: does the widespread use of the EASY prefix across a portfolio of brands mean that consumers will assume any EASY+suffix sign originates or is associated with easyGroup?

HHJ Hacon’s answer was clear: not without evidence.

Background

easyGroup, the owner and licensor of the well-known EASY brand portfolio, brought proceedings against Easyfeetstore, its director and an associated US company. The defendants sold orthopaedic and orthotic insoles online using the signs EASYFEET and EASYFEETSTORE.

easyGroup relied on a number of registered trade marks, including marks such as EASYJET, EASYGROUP, EASYFOOD, EASYFOODSTORE and EASYTRAVELSEAT. It alleged infringement under sections 10(2) and 10(3) of the Trade Marks Act 1994, passing off, and sought invalidation of the defendants’ UK EASYFEET registration.

Although a number of issues arose, the case was ultimately driven by easyGroup’s contention that it had established a recognised ‘family of marks’ built around the word EASY.

The key issue: did easyGroup have a protectable family of marks?

The concept of a family of marks is well established in trade mark law. In principle, where consumers recognise a series of marks sharing a common characteristic as originating from the same undertaking, the use of a new mark displaying that characteristic may give rise to indirect confusion.

easyGroup argued that consumers had come to recognise EASY marks as denoting businesses connected with easyGroup. According to that argument, a consumer encountering EASYFEET would assume it was another member of the easyGroup stable of brands.

The difficulty for easyGroup was that the only feature common to all of the marks relied upon was the word EASY. That placed substantial weight on the proposition that the word EASY alone had become a source identifier for easyGroup across a broad spectrum of goods and services.

Why the argument failed

HHJ Hacon concluded that the evidence fell well short of establishing the existence of the claimed family.

A particularly striking aspect of the judgment is the court’s observation that easyGroup has brought numerous similar actions over the years (approx. 76 since 2015), yet had not produced evidence demonstrating that the public recognises EASY+suffix marks as identifying businesses associated with easyGroup.

The judge also relied on earlier authorities, including easyGroup v Beauty Perfectionists [2024] EWHC 1441 (Ch), where similar arguments had been rejected.

The court characterised easyGroup’s position as effectively requiring consumers to assume that any mark consisting of EASY coupled with a descriptive suffix belonged to easyGroup. HHJ Hacon regarded that as an extreme proposition which had not been established on the evidence before him.

This finding proved decisive throughout the remainder of the infringement analysis.

No likelihood of confusion

Once the family of marks argument fell away, easyGroup faced a more conventional comparison between its marks and the defendants’ signs.

The court held that the only common element was the word EASY, which the judge regarded as descriptive and lacking inherent distinctiveness. The suffixes (such as JET, FOOD, TRAVELSEAT, FEET and FEETSTORE) were quite different.

In those circumstances, the court found no relevant visual, aural or conceptual similarity capable of generating either direct or indirect confusion. Importantly, there was also no evidence of actual confusion notwithstanding the parties’ concurrent trading.

The section 10(2) claim therefore failed.

No link, unfair advantage, detriment to distinctive character or detriment to reputation

easyGroup also advanced claims under section 10(3) of the Trade Marks Act.

The court accepted that EASYJET enjoyed a substantial reputation and that EASYFOOD had acquired a reputation within its own field. However, even where reputation existed, easyGroup still had to show that consumers would form the requisite ‘link’ between the defendants’ signs and the relevant trade mark.

The court found that no such link had been established. Nor was there evidence of unfair advantage, detriment to distinctive character or detriment to reputation.

As a result, the section 10(3) claims also failed.

Passing off and invalidity

The remaining claims met a similar fate.

The passing off claim failed because the underlying allegation of consumer confusion was not made out. Likewise, the challenge to the defendants’ EASYFEET registration stood or fell with the infringement case and was dismissed.

Commentary

This decision provides one of the clearest recent judicial statements on the evidential burden involved in establishing a family of marks.

The judgment does not undermine the doctrine itself. Rather, it demonstrates that a claimant must prove that consumers genuinely recognise the common element of the alleged family as an indicator of trade origin. Mere ownership of multiple registrations using the same descriptive component will not suffice.

The case is also a useful reminder that descriptive or laudatory terms remain inherently weak foundations on which to build broad exclusivity claims. The larger and more commercially successful a brand portfolio becomes, the more tempting it may be to argue that a naming convention has acquired independent significance. However, courts will still expect robust evidence that consumers perceive it in that way.

For brand owners, the practical lesson is straightforward: if a family of marks argument is going to form a central part of an enforcement strategy, evidence of consumer recognition should be gathered before litigation begins. For defendants, the judgment provides useful support where the alleged similarity rests primarily on a common descriptive element.

In short, easyGroup v Easyfeetstore confirms that a family of marks can be a powerful doctrine, but only where the family is recognised by consumers rather than assumed by its owner.

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Rising costs, new rights: The challenge facing retail employers

Wed, 15 Jul 2026 00:00:00 +0100

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Rising costs, new rights: The challenge facing retail employers

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What a £4 flat white can tell us about jobs, costs and youth unemployment.

Published: 15 July 2026
Authors: Samantha Mackie

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Rising costs, new rights: The challenge facing retail employers

The UK's consumer and retail sector is facing a difficult balancing act. Businesses are already contending with rising wage costs, higher National Insurance contributions, energy prices, inflationary pressures, supply chain disruption and changing consumer behaviours, leading to increasingly tight margins.

A recent article in The Independent illustrates just how slim those margins can be. It revealed that a £4.10 flat white generates just 18p profit once costs such as wages, high utilities and business rates, VAT and overheads are accounted for.

While this may surprise consumers, it highlights a fundamental reality facing employers. Rising costs of ingredients and supply chain disruption have also increased the cost base for hospitality operators. Increasing the stakes even further, of the £4.10 charged, around £1.60 is attributable to staff costs alone. This underscores the fact that despite industry specific pressures, labour is often the largest cost in service-led businesses.

Against this backdrop, the Employment Rights Act 2025 (ERA 2025) is set to introduce significant additional employment costs and obligations. For employers operating on narrow profitability margins, the reforms raise concerns about whether additional costs can be absorbed without impacting recruitment, product quality or consumer prices.

The changing employment law landscape

The ERA 2025 represents one of the most significant changes to UK employment law in a generation. This is particularly significant for consumer and retail employers, whose business models often depend on large workforces, flexible staffing arrangements such as part-time workers and the ability to respond quickly to fluctuating customer demand during seasonal periods.

Key changes include:

earlier unfair dismissal protection: From January 2027, employees will be able to bring unfair dismissal claims after six months’ service rather than two years, reducing employers' ability to assess suitability and performance before legal risk arises. This is particularly significant for sectors with high staff turnover and large volumes of entry-level recruits
guaranteed hours obligations and compensation for cancelled shifts: From 2027, employers will be required to offer certain zero hour and low hour workers contracts that more closely reflect the hours they have actually worked over a reference period and may have to pay compensation and face penalties for cancelling or changing these workers’ shifts at short notice. This could significantly affect businesses that rely on flexible staffing models to manage seasonal peaks and changing demand
extended time limits for bringing claims: From October 2026, most tribunal claims will be subject to a six-month limitation period rather than three months, increasing legal uncertainty and the cost of managing workplace disputes
from October 2026, there is a proactive duty to take ‘all reasonable steps’ to prevent sexual harassment, and to prevent third-party harassment related to any protected characteristic: This is particularly relevant for customer-facing sectors where employees regularly interact with members of the public.
uncapped compensation for unfair dismissal: The removal of the statutory cap on compensation from 1 January 2027 increases financial exposure arising from employment disputes at a time when many businesses are already operating on narrow margins.

Cost pressures and workforce decisions

Several of the reforms under the ERA 2025 are likely to increase both direct labour costs and the costs associated with managing legal risk:

guaranteed hours and compensation for cancelled shifts may make it more difficult for employers to align staffing levels with fluctuations in customer demand, potentially increasing labour costs during quieter trading periods
earlier unfair dismissal protection and uncapped compensation increase the risks associated with recruitment decisions. Employers may face greater costs where employment relationships do not work out, either through defending claims or through increased settlement and compensation exposure
additional sexual harassment prevention obligations are also likely to require further investment in policies, training, and reporting processes

These reforms arrive at a particularly challenging time for the sector where even modest cost increases can have a disproportionate impact on profitability. Historically, employers could respond through flexible staffing arrangements or adjusting working hours. However, as the ERA 2025 limits some of these options, employers may instead place greater emphasis on reducing recruitment, implementing earlier performance management processes or investing in automation.

Implications for youth employment

The implications of these changes may extend beyond business profitability. Increased labour costs and legal risks may make employers more cautious about creating new roles or taking chances on inexperienced candidates.

This is particularly significant for young people. Consumer and retail employers, such as coffee shops and high street chains, have traditionally provided an important entry point into the labour market, allowing young people to gain work experience and develop transferable skills. But where the cost and risk of employment increases, employers may become more selective in their hiring decisions, potentially reducing opportunities for first-time entrants to the workforce.

Recent data shows that youth unemployment is already rising. Around one million young people are classified as not in education, employment or training (NEET), representing approximately 13.5% of all 16- to 24-year-olds. The ERA 2025 reforms risk adding further pressure to an already challenging picture.

What should employers be doing now?

Consumer and retail employers should begin preparing for the practical impact of further changes under the ERA 2025 and the additional costs it may bring. In particular, employers should consider:

reviewing recruitment and probationary processes to ensure performance, conduct and attendance concerns are identified and managed effectively within the first six months of employment
strengthening measures to prevent sexual harassment including reviewing policies, reporting procedures, and training, particularly for customer-facing staff
assessing workforce planning and scheduling models to ensure they remain suitable in light of guaranteed hours obligations
preparing for an increased risk of employment litigation by reviewing record-keeping practices, manager training and internal processes for early dispute resolution
considering the role of technology and automation within workforce planning as labour costs and compliance obligations increase

Conclusion

The £4.10 flat white demonstrates just how little room many consumer and retail businesses have to absorb additional costs. Against a backdrop of rising operating expenses, the ERA 2025 is set to introduce further labour costs, legal risks and compliance obligations.

While the reforms intend to strengthen worker protections, they may also influence how employers recruit, manage and retain staff. The challenge for businesses in the sector will be balancing these new obligations with commercial reality, without passing costs on to consumers, impacting product quality or reducing opportunities for those entering the workforce.

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No free ride for privilege: White v Uber, litigation privilege and funding communications

Wed, 15 Jul 2026 00:00:00 +0100

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No free ride for privilege

White v Uber, litigation privilege & funding communications

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The High Court has held that litigation privilege does not extend to documents created for the purposes of assessing the the commercial viability of funding litigation.

Published: 15 July 2026
Authors: Emma Carr

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The High Court’s decision in Uber London Ltd & Ors v White & Ors (Re Disclosure) [2026] EWHC 1610 (Comm) serves as a useful reminder for prospective parties to litigation, their legal teams and potential funders that privilege cannot safely be assumed simply because a document discusses the merits of a claim or was created against the backdrop of contemplated proceedings.

The judgment does not itself establish any new law. Rather, it reinforces a principle that has become increasingly clear since the Court of Appeal’s decision in WH Holding Ltd & Anor v E20 Stadium LLP [2018] EWCA Civ 2652, a case with which the author was involved, namely that litigation privilege protects communications created for the dominant purpose of conducting litigation, not every commercial decision made because litigation is contemplated.

Background

The judgment arose out of a disclosure application in claims for unlawful means conspiracy brought against three entities in the Uber group. The Claimants include around 13,000 black cab drivers and the assignee of claims formerly held by two private hire businesses. The claims are proceeding to a preliminary issue trial on limitation, specifically whether the Claimants discovered, or could with reasonable diligence have discovered, Uber’s alleged wrongdoing only after late June 2018.

Against that background, Uber sought disclosure of pre-October 2018 communications between Mishcon de Reya (the Claimants’ solicitors), Harbour¹ (the litigation funder) and the Licensed Taxi Drivers’ Association (of which some individual Claimants are members). Uber contended that those documents could be relevant to what was known by, or reasonably discoverable to, the Claimants before the key limitation dates. The Claimants resisted disclosure on the basis of relevance, privilege, control and proportionality.

Why litigation privilege mattered

Litigation privilege is one of the most important protections available to parties preparing for disputes. It enables parties to investigate claims, obtain evidence and seek advice without fear that those communications will later have to be disclosed.

The difficult question is not usually the existence of the principle, but where its boundaries lie.

White v Uber asks a similar question in the funding context.

The funding context

Before proceedings were issued, Harbour had engaged Mishcon de Reya to investigate potential claims against Uber. At that stage, Mishcon de Reya had not yet been retained by the individual Claimant drivers. The documents in issue were generated while Mishcon de Reya was retained by Harbour and before it later acted for the Claimants.

The Court accepted that some material was relevant, particularly documents that might shed light on what individual drivers knew or understood about possible claims against Uber before June 2018. It also accepted that material showing what Mishcon de Reya and Harbour had discovered might, in principle, be relevant to what the Claimants could with reasonable diligence have discovered, although that category was more indirect.

The privilege decision

Mr Justice Birt held that the relevant Harbour communications did not attract litigation privilege on the evidence before the Court. Their dominant purpose was to enable Harbour to decide whether to fund the litigation. That was a commercial funding decision, not the conduct of litigation itself.

The judgment is not authority for the proposition that communications with funders can never be privileged. Nor does it remove the protection of legal advice privilege where a funder is receiving legal advice and the relevant test is satisfied – as the Court acknowledged would likely be the case here. Its significance is narrower, but important: litigation privilege will not arise merely because the documents concern contemplated litigation, analyse merits or quantum, or are created in the course of a proposed funding exercise. Instead the key question the court will ask is why the documents were created.

That focus on purpose is consistent with the approach in WH Holding. The fact that a communication may be commercially important to litigation, or may affect whether litigation can practically be pursued, does not necessarily mean that it was created for the dominant purpose of conducting the litigation.

Control and informed consent

The judgment also contains an important control point. Where a law firm first acts for a funder in assessing a potential claim and later acts for the claimants, relevant material from the earlier engagement with the funder may be within the claimants’ control for disclosure purposes. That will be difficult to avoid unless (i) the claimants have given properly informed consent to the firm withholding that information² and (ii) that information is in fact withheld.

Practical takeaways for in-house teams (acting as claimant or defendant) and funders

where material is created primarily to enable a prospective funder to decide whether to invest, litigation privilege should not be assumed simply because legal analysis and the contemplation of litigation appears within it. Funding workstreams should be structured with privilege in mind from the outset.
second, there is a practical tension. Funders will need enough information to assess merits, quantum and risk, but claimants and their advisers should consider carefully whether material prepared or shared for that purpose is privileged, and on what basis.
funders and funded parties should distinguish between documents created for a funding decision and documents created, if applicable, for the conduct of litigation. The former may not attract litigation privilege, even where the proposed claim is analysed in detail. The latter may still be protected if the dominant purpose test is satisfied and/or if legal advice privilege applies.
defendants facing a funded action should scrutinise claims of litigation privilege where funding-related communications are withheld on a blanket basis. Privilege claims need to be properly made and explained. It is not enough simply to describe a class of documents as “privileged” without identifying the type of privilege claimed and the basis for it.
in-house legal teams should focus on purpose from the outset. The label attached to a document, or even the presence of detailed legal analysis, is unlikely to be determinative if the communication was created to facilitate a commercial decision rather than the conduct of litigation. As ever, careful consideration should be given to who within the organisation can properly be regarded as the “client” for privilege purposes.

Read alongside WH Holding, White v Uber illustrates a consistent judicial approach rather than a change of direction. The Courts are maintaining a distinction between communications created for the conduct of litigation and communications created to support commercial decisions associated with litigation, such as commercial decisions surrounding settlement and funding.

That distinction is likely to become increasingly important as third party funding and ATE insurance continue to play a greater role in commercial disputes.

¹ There are various Harbour entities and for reasons explained at para 80 of the judgment none were party to the application however it appears the relevant entity was Harbour Fund IV LP.
² For the purposes of paragraph 6.4(b) of the SRA’s Code of Conduct

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Private equity 2026 half-year update: Resilience & liquidity

Wed, 15 Jul 2026 00:00:00 +0100

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Private equity 2026 half-year update: Resilience & liquidity

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The UK private equity market entered 2026 with cautious optimism. Activity remains selective, with capital focussed on high-quality assets, resilient sectors and businesses with clear value creation plans.

Published: 15 July 2026
Authors: Elizabeth Ward

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PitchBook data presented to Shoosmiths in July 2026 reinforces this nuanced picture. The UK remains Europe’s largest private equity market by deal value, with UK PE deal value ahead of France, Germany, the Netherlands and other major European markets in 2026 year-to-date data. However, UK PE activity is pacing 12% lower year-on-year, compared with a 6% decline across Europe and a 20% decline in the US, suggesting that while activity has moderated, the UK remains relatively resilient in a more challenging global environment.

That resilience is also reflected in the broader structure of the UK market. The number of PE-backed companies in the UK has continued to grow, while the number of publicly listed UK companies has declined. PitchBook’s data shows UK PE-backed companies increasing over the last decade, alongside a continuing fall in the number of publicly listed companies. This points to a longer-term shift in the UK corporate landscape: more businesses are remaining private for longer with private capital continuing to play an increasingly important role in funding growth.

Quality over volume

Activity has continued to favour stronger assets. KPMG’s UK private equity outlook points to competition for quality assets, particularly those with recurring and reliable revenue streams, and identifies bolt-ons, exits and operational value creation as key trends for 2026. That mirrors what we are seeing in our own deal activity at Shoosmiths. Sponsors and portfolio companies remain active, but they are prioritising businesses with a clear investment thesis: opportunities to scale, consolidate fragmented markets, deepen capability, access new customers or use technology to improve operating performance.

Buy-and-build remains central

Buy-and-build strategies remain central, with sponsors looking to create value through existing platforms rather than relying solely on new platform investments. Bolt-ons offer a lower risk route to growth, particularly where they support expansion into new geographies, specialist capability, technology or customer bases. PitchBook’s Q1 2026 European PE data points to this trend, with add-ons as a percentage of buyouts rising from 67.4% in 2025 to a decade high of 71.4% in Q1 2026.

Liquidity, exits and realisation strategies

Liquidity and realisation strategies remain a key focus as sponsors face pressure to return capital to investors. With hold periods extending, firms are exploring a wider range of options, including continuation vehicles, minority recapitalisations and refinancing transactions for stronger assets. We are also seeing greater emphasis on exit readiness well before a formal process begins, as buyers and lenders scrutinise whether the investment thesis has been delivered and where further growth remains available.

Sectors: business services, technology and healthcare remain active

One key growth area is B2B deals, with PitchBook's UK sector data showing that B2B transactions represented a significant share of UK private equity deal value in 2026 year-to-date. This mirrors what we are seeing, with professional and business services remaining highly attractive to private equity, particularly where sponsors can pursue consolidation strategies in fragmented markets. We have supported a number of PE-backed accountancy platforms as they continue to pursue strategic acquisitions across the UK and Europe.

Sponsor interest remains strong in software, automation and technology-enabled businesses that support operational efficiency, regulatory compliance and scalable growth, particularly where AI is delivering demonstrable commercial benefits. Compared with 12 months ago, AI, technology infrastructure and data governance feature much more prominently in diligence processes. The strength of a target's digital capabilities and governance framework is increasingly influencing assessments of investment quality, value-creation opportunities and eventual exit readiness.

Healthcare and essential services continue to attract sponsor interest, although regulatory complexity and valuation expectations are prompting a more selective approach. Sponsors remain focused on businesses with resilient demand, specialist expertise and clear opportunities to professionalise operations and support scalable growth.

Cross-border capital remains important

International capital continues to be key. PitchBook data shows that approximately one in three UK PE deals involve a US sponsor, with US investor participation in UK PE deal count reaching around 32% in 2026 year-to-date data. This demonstrates that UK assets continue to attract international capital, particularly where businesses have strong management teams, scalable models and opportunities for growth beyond the UK.

Increased international capital also increases the importance of cross-border execution capability. Transactions involving US or European sponsors often require coordination across multiple jurisdictions, regulatory regimes and adviser groups. That trend is reflected in a number of Shoosmiths' recent transactions, where international investors, overseas targets and multi-jurisdictional workstreams have required coordinated execution across a wide range of legal and regulatory frameworks.

Outlook for H2 2026

The UK remains a deep and attractive private capital market, but investors are continuing to be selective. We expect quality assets to continue to attract capital, particularly in professional and business services, technology, healthcare, education and infrastructure.

Buy-and-build is also likely to continue to feature prominently, especially where platform businesses need to demonstrate growth and operational progress ahead of eventual exit. We also anticipate continued focus on creative structuring, regulatory planning and exit readiness, particularly as sponsors look to return capital to investors after extended hold periods.

The market still has challenges to navigate, including geopolitical uncertainty, higher financing costs, valuation gaps and a tougher IPO environment. Even so, H1 2026 has shown that private equity remains active where the fundamentals are strong: sector focus, disciplined execution and a clear value-creation plan.

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