This article explores 10 British stocks to hold not only for European market diversification, but also a global diversification since they globally renowned brands. British stocks generally pay higher dividend compared to their American counterparts, but tend to fluctuate, based on the exchange rate. Another caveat is that some companies only pay dividends once or twice a year, as opposed to the normal four times a year. The stocks discussed here all listed on the US exchanges trading as ADRs.

The advantage of buying British stocks for a dividend play is that American and Canadian investors can take advantage of a tax break. The tax treaty between the countries allows companies to pay out the dividends without any withholding taxes. Some stocks described below are originally companies from other countries (BHP is Australian, Royal Dutch Shell and Unilever are companies from the Netherlands), but because they are registered in the UK, can be traded as UK-listed companies offering investors the said tax break.

Let's jump into the details of the 10 British stocks to consider.

AstraZeneca plc (AZN) is a global pharmaceutical company. AstraZeneca discovers, develops and commercializes prescription medicines for six areas of healthcare: Cardiovascular, gastrointestinal, infection, neuroscience, oncology, and respiratory and inflammation. AZN has a 5-yr average yield of 3.2% and a 5-yr dividend growth rate (DGR) of 3.86%.

BHP Billiton (BHP) (BBL) is a diversified natural resources company. The company operates in nine segments: petroleum, aluminum, base metals, diamonds and specialty products, stainless steel materials, iron ore, manganese, metallurgical coal and energy coal. BHP Billiton trades under two ADR symbols NYSE: BHP, which is registered in Australia (Americans and Canadians also get the same tax treatment as described above - no withholding taxes when held under retirement accounts) and NYSE: BBL which is registered in the UK. BHP/BBL has been raising dividends for 12 years, has 5-yr average yield of 3.5% and 5-yr DGR of 8.1%.

British American Tobacco plc (BTI) is a holding company in, as the name suggests, the tobacco sector. The company's four principal brands include Dunhill, Kent, Lucky Strike and Pall Mall. The company has many other famous international and local brands, including  Rothmans, Vogue, Viceroy, Kool, Peter Stuyvesant and Benson & Hedges. The company's brands are sold in over 180 markets - which includes cigarettes, smokeless snus and cigars. BTI has a record of raising dividends for 10 consecutive years, has a 5-yr average yield of 3.7% and 5-yr DGR rate of 11.8%.

Diageo plc (DEO) produces, distills, brews, bottles, packages and distributes spirits, beer, wine, and ready to drink beverages. DEO sells products in more than 180 markets with brands such as Johnnie Walker, Crow Royal, J&B, Buchanans, Windsor and Bushmills whiskeys; Smirnoff, Ketel One, Croc vodkas; Captain Morgan rum and rum-based products; Bailey's, Tanqueray, Guinness stout. DEO has raised dividends for 5 consecutive years, has a 5-yr average yield of 2.3% and a 5-yr DGR of 8.3%.

GlaxoSmithKline plc (GSK) is a global healthcare group, which is engaged in the creation and discovery, development, manufacture and marketing of healthcare products, including vaccines, over-the-counter medicines and health-related consumer products. GSK's principal pharmaceutical products include medicines in therapeutic areas: respiratory, anti-virals, central nervous system, cardiovascular and urogenital, metabolic, antibacterials, oncology and emesis, dermatology, rare diseases, immuno-inflammation, vaccines and human immunodeficiency virus (HIV). GSK has a 5-yr average yield of 5.1% and 5-yr DGR of 6.07%.

HSBC Holdings plc (HSBC) is a global banking and financial services organization. As of Dec 31, 2012, it provided a range of financial services to around 58 million customers through four global businesses: retail banking and wealth management, commercial banking, global banking and markets, and global private banking. HSBC has a 5-yr average dividend yield of 3.8% and a 5-yr DGR of 8.02%.

National Grid plc (NGG) is an international electricity and gas company. The company's segments include UK transmission, UK gas distribution, US regulated and other activities. The company owns the electricity transmission system in England and Wales and is the national electricity transmission system operator, responsible for both the England and Wales transmission system, and the two high voltage transmission networks in Scotland, which the company does not own. The company also owns and operates electricity distribution networks in upstate New York, Massachusetts, Rhode Island and New Hampshire. NGG has a 5-yr average yield of 4.2% and a 5-yr DGR of 3.61%.

Royal Dutch Shell plc (RDS-B) operates as an independent oil and gas company worldwide. The company explores for and extracts crude oil, natural gas, and natural gas liquids. The company had stopped raising its dividends from 2009 to 2012, but has initiated the increases again since 2012. RDS.B has a 5-yr average  yield of 5.10% and a 5-yr DGR of 2.28%.

Unilever (UL) is a giant in the consumer goods sector. Unilever has four business segments - personal care, foods, refreshment and home care. Unilever offers products under various brand names such as Axe, Becel, Flora, Ben & Jerry's, Bertolli, Blue Band, Rama, Brylcreem, Cif, Clear, Comfort, Domestos, Dove, Fissan, Heartbrand, Hellmann's, Amora, Knorr, Lifebuoy, Lipton, Lux, Omo, Pond's, Radox, Rexona, Signal, Closeup, Simple, St Ives, Sunlight, Sunsilk, Surf, TRESemm, Timotei, VO5 and Vaseline. UL has been raising dividends for 25 years and has a 5-yr average yield of 3.6% and a 5-yr DGR of 5.96%.

Vodafone Group plc (VOD) provides mobile telecommunication services worldwide, serving approx 450 million customers. Vodafone has equity interest in telecom operations in nearly 30 countries and around 50 partner networks worldwide. Vodafone has a 5-yr average yield of 6.6% and a 5-yr DGR of -5.24%.