The cost of regulation just topped $1 trillion: report

Lawyers working at a desk.
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The estimated cost of complying with regulations for firms around the world is some $1.2 trillion, according to a report published on Thursday by international law firm Berwin Leighton Paisner.

Its 'Speed of Business' study was based on interviews with 250 global businesses in six sectors that included oil and gas, finance, and real estate. The countries in the survey were the U.S., U.K., Germany, Spain, Italy, France, China, Japan, Hong Kong and Singapore.

(Read more: Regulations raising cost of doing business)

"The total cost of compliance for the six sectors in ten economies surveyed, was $1.2 trillion," Berwin Leighton Paisner said in a statement.

"The importance of innovation and informed leadership was a key theme throughout the research and many executives felt that despite innovation being critical to company growth - almost a third believed regulation had made it harder to achieve," it added.

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The law firm said that some negative views about regulation may stem from the perceived cost that excessive regulation creates. Over 40 percent of the firms surveyed believed they spend between 5 and 10 percent of their turnover on complying with regulations, according to the study.

Overall, 59 percent of respondents in the U.S. and 54 percent in Asia said that government regulation had a positive impact on their ability to innovate, with the response in Europe at 40 percent.

In the U.S., there were some areas of concern such as financial regulation, with 54 percent of respondents saying financial regulation was a "serious barrier" to economic growth. That compared with 42 percent in Asia and 28 percent in Europe.

Since the global financial crisis, the financial industry globally has faced tighter regulations. In the U.S., for instance, regulators are trying to agree on the final wording of the controversial Volcker rule that blocks banks from proprietary trading or making risky trades with a company's own money.

(Read more: Federal Reserve considering a delay to Volcker rule)

China blues

China appeared to stand out in the report as one country in particular where regulation was seen a big obstacle to business.

Foreign companies have flocked to the world's second largest economy to take advantage of the country's rapid economic development and growing class of consumers.

According to Berwin Leighton Paisner, financial services firms in China were hardest hit in terms of costs related to regulation. The costs were estimated at $54 billion, followed by $42 billion in the real-estate sector.

Chinese companies estimate they will spend $127 billion on complying with regulation over the next year across financial services, real estate and health alone, the report said.

China last week unveiled a 60-point reform plan for sweeping economic changes. These include measures to open up markets and loosen controls on the pricing of water, electricity and natural resources.

(Read more: China's economic reforms: What you need to know)

"China stands out as a country that firms would like to break into but are deterred from doing so due to complex and un-navigable regulation," the Speed of Business study said.

"Interestingly, neighboring Asian businesses we interviewed in Japan, Hong Kong and Singapore also viewed China as the place they would like to break into but felt regulation was preventing them," it added.

—By CNBC.Com's Dhara Ranasinghe; Follow her on Twitter @DharaCNBC