More than three-quarters of UK companies have seen an increase in regulatory inquiries and investigations over the past three years, according to research published today (15 October).

US law firm Fulbright & Jaworski found that regulatory matters top the list of greatest concerns for UK businesses, with 53 per cent pinpointing it as a major concern.

Chris Warren-Smith, Fulbright’s head of international financial services disputes, said: “UK companies citing regulatory matters at the top of their litigation concerns is in stark contrast to two years ago, when employment disputes were of greatest concern.”

The focus on regulation comes as UK companies witness an increase in inquiries from the US government-led regulator the Securities and Exchange Commission.

Fulbright’s fourth annual litigation trends survey found that 81 per cent of UK businesses had received requests for information compared with less than a quarter last year.

The report also reveals that almost a quarter of the 305 companies in the UK and US surveyed had total annual legal spends of £5m with UK businesses having an average spend of £1.5m, compared with £1.8m in the US.

Lista Cannon, the US firm’s London chief, said the majority of legal budgets are now being spent on regulatory matters.

“The study shows the level of litigation against companies has gone down from 12 months ago,” said Cannon. “But the spend hasn’t faltered, which means the money is being refocused on internal and external investigations.

“The cost can be justified in that what goes in the investigation reports, such as document analysis and witness statements, would have to be done anyway if litigation ensued.”