Top legal trends for UK SMEs in 2025: What you need to know

As we head into 2025, the legal landscape for SMEs in the UK is evolving and staying ahead of these changes could make all the difference for your business. Whether you’re streamlining your contracts, protecting customer data, or keeping up with shifting regulations, now’s the time to prepare.

Here are the key legal trends to watch, with practical insights to help you stay one step ahead.

1. Data protection: Flexibility on the horizon

The UK’s Data Protection and Digital Information Bill (or whatever version of it passes into law) is one to watch. If the changes remain as proposed it promises to make compliance simpler, swapping rigid requirements like DPIAs (Data Protection Impact Assessments) for more flexible risk assessments and updating rules around subject access requests (SARs) to help businesses manage “vexatious” requests.

Why does it matter? Whether or not this bill passes as is, the direction is clear: data compliance will stay central, but businesses may have more room to adapt how they meet their obligations.

What should you consider doing? Audit your current data processes and ensure you’re equipped to handle changes whether that’s updating privacy notices, training staff, or tightening cybersecurity.

2. Late payments: Big businesses may be running out of excuses

The ongoing issue of late payments is still under the spotlight, with regulators pushing for stronger penalties to protect smaller businesses. Expect tighter rules and enforcement in 2025 to crack down on delays that cause cash flow headaches for SMEs.

Why does it matter? A stronger stance on late payments is great news for SMEs, but you’ll still need clear payment terms, rights you can enforce against late payers, and robust systems to enforce them.

What should you consider doing? Review your contracts now to ensure your terms are watertight and consider automating your invoicing processes to stay on top of cash flow.

3. Consumer protection and greenwashing: Getting real

New rules under the Digital Markets, Competition and Consumers Act are coming into play, and they’re a game-changer for anyone selling to consumers. Businesses need to be upfront about pricing, terms, and environmental claims and there can’t be anymore greenwashing or vague “eco-friendly” statements without proof.

Why does this matter? Misleading claims or unclear terms could result in fines or reputational damage. Transparency isn’t just a legal requirement; it’s what customers demand.

What should you consider doing? Be honest about your product claims, back up sustainability credentials with evidence, and review your terms and conditions for clarity and fairness.

4. Supply chain risks: Keeping things in check

Supply chains have been under pressure for years, and contracts are starting to reflect that. Force majeure clauses, price escalation terms, and stricter performance obligations are becoming standard.

Why does it matter? SMEs need to protect themselves from supply chain disruptions while maintaining strong relationships with partners.

What should you consider doing? Review your supplier contracts to ensure they cover risks like delays, rising costs, and unforeseen disruptions. Clear remedies for non-performance can save you headaches down the line.

5. Intellectual property: Protect what is yours

Whether it’s a new product design or your business name, intellectual property (IP) is one of your most valuable assets. As competition heats up, SMEs need to be proactive about protecting their IP and enforcing their rights and also need to ensure they are not registering IP in bad faith (see Are your trade marks safe? Lessons from the Sky/SkyKick case for small and medium sized businesses for more on bad faith).

Why does it matter? Your brand and innovations are what set you apart. Neglecting to protect them could cost you in the long run. Protecting them too much can also cause problems as your registration could be invalid if you have no intention of selling goods and services in the classes registered in.

What should you consider doing? Conduct an IP audit, register trademarks where needed, and ensure contracts with partners and suppliers safeguard your rights.

6. Other emerging trends to watch

There are a few other areas gaining attention in 2025 that SMEs should have on their radar. Consider consulting employment and ESG Compliance specialists for support.

Employment law. Flexible working and transparency in pay are hot topics. While not my area of expertise, it’s worth staying informed and consulting an employment lawyer if you need support.

ESG Compliance: Sustainability reporting is becoming more of a priority. For businesses ready to showcase their environmental and governance practices, this could be an opportunity to stand out.

Navigating legal trends might not be the most exciting part of running a business, but it’s crucial for growth and resilience. Whether it’s updating your contracts, protecting your data, or planning for regulatory changes, staying proactive is the best way to protect your business and build trust with customers. At Adaptable Legal Counsel, I specialise in helping SMEs make sense of legal complexities with practical, tailored advice. If you’d like a hand preparing for 2025, feel free to get in touch, I’d love to help your business thrive.

About Adaptable Legal Counsel

Adaptable Legal Counsel offers flexible legal services designed to meet the unique needs of small and medium-sized businesses. We specialise in helping businesses with drafting contracts, negotiating partnerships with larger clients, and tackling specific legal challenges, and much more. Whether you’re looking for legal counsel as a service, fractional legal support, or assistance with day-to-day commercial legal work, we’re here to help.

For more information about how Adaptable Legal Counsel can support your business, visit our website. To book a free, no-obligation initial chat, click here.

About Amy

Amy is a commercial solicitor with a strong background in commercial contracting. During her time at Panasonic and Reed Exhibitions (RX Global), part of the RELX Group, Amy gained invaluable experience advising on contractual matters. She now offers fractional legal support, helping SMEs navigate complex legal landscapes with confidence and efficiency. She now offers flexible legal services, including flexible retainers and fractional legal counsel as a service packages through Adaptable Legal Counsel.

Disclaimer: This blog is for informational purposes only and should not be considered legal advice. The content provided here is intended to offer general insights into key contract clauses for small businesses. For specific legal advice tailored to your circumstances, please consult a qualified legal professional. Adaptable Legal Counsel disclaims any liability for actions taken or not taken based on the information in this blog.