Factbox - What happens after votes are counted in the UK election?

(Reuters) - Britain votes in an unusually close national election on May 7 with no one party forecast to win an overall majority. A surge in support for nationalist and single-issue parties has fragmented the traditional two-party system long dominated by the Conservatives, led by David Cameron, and Labour, led by Ed Miliband, leaving an array of possible outcomes. Few legally binding rules govern the process of forming a coalition. But, based on convention, the principal facts and procedures concerning how Britain's next government will be formed are set out below. ELECTION BASICS Voters are asked to elect a member of parliament for their local constituency. The candidate with the most votes wins. Britain's first-past-the-post electoral system means the winner-takes all situation. There is no system of proportional representation for candidates who come second. For the election to produce a majority government, the biggest party theoretically must win at least 326 seats of the 650 regional constituencies. But in practice, the threshold for a majority is around 323, because the Sinn Fein party does not take up any seats it wins in Northern Ireland. The defining principle for any prospective government is that it has the support of a majority of lawmakers in the elected lower chamber of parliament, the House of Commons. This is typically tested by a vote on the Queen's Speech -- a speech at the start of a parliament setting out a legislative agenda which has been prepared by the prospective government and is read out by Queen Elizabeth. WHO IS IN CHARGE NOW? Parliament was officially dissolved on March 30 and all 650 seats declared vacant. Prime Minister David Cameron and his team of ministers remain in charge of their departments and retain their ministerial decision-making power. But, by convention, the government refrains from taking major policy decisions, entering new long-term commitments or making high-profile appointments. If a national emergency forces the government to act quickly, it may consult with the opposition informally to discuss the best course of action. When a new parliament is formed, it may be required to endorse actions taken during the interim period. HUNG PARLIAMENT If there is no majority winner once the votes are counted, political parties begin negotiations to determine the next government. In that case, Cameron and his ministers would remain temporarily in charge. He would be expected to continue to use the official prime ministerial Downing Street residence in central London. Cameron, as incumbent, is entitled to the first attempt to test confidence in his government through a vote in parliament. During negotiations, Cameron and his team retain their full legal powers to act on behalf of the country. Legislation introduced in 2011 fixed the date for the 2015 vote, allowing the government to finish most of its outstanding business and minimise the number of decisions that need to be made during the election period. The Institute for Government think tank says that if it was clear Cameron could form the next government, the restrictions on decision-making that applied in the pre-election period could be loosened. Conversely, if it was clear he had lost the election his ability to make decisions during this period would be constrained. The outcome of the inter-party negotiations would decide the next government. If it became apparent Cameron was not able to form a government, he would be expected to resign once an alternative government had become clear. In 2010, the talks that resulted in a coalition between the Conservatives and the Liberal Democrats lasted five days, but no deadline is set for the negotiations. The Institute for Government says talks may well take longer this time because parties will have learned lessons from 2010, when unresolved differences led to political problems further down the line. The Queen's speech is due to be delivered on May 27. "This will give the parties about 18 days to conclude their negotiations and present the Queen with a clear candidate for prime minister," an Institute for Government briefing note said. "This will probably be enough" THE NEXT GOVERNMENT In the event of a hung parliament three types of government could be formed: Formal coalition - Two or more political parties, whose combined number of seats produce a working majority, enter a formal coalition government made up of ministers from the participating parties. The coalition produces joint policies and votes together on them. Informal coalition - A pact between two or more parties to co-operate on a range of issues. They would agree to pass the Queen's Speech and reject any subsequent "no confidence" motion proposed by the opposition. Minority government - A party without a majority, which is able to win the Queen's Speech vote in parliament. That party would then rely on cutting ad hoc deals with other parties to win the votes required to pass new laws. THE NUMBERS - Either the Conservatives or Labour will win the most seats. Current predictions show both falling short of a majority, with the overall winner not currently expected to win more than 300 seats. - The Liberal Democrats, who became junior coalition partners in 2010 with 57 seats, are forecast to suffer heavy losses. But they may still do well enough to form a coalition with Labour or the Conservatives. Politically, they could form a coalition with either party. They have said they will open coalition talks with whichever one of the two main parties has won a mandate to govern, but have not defined whether this means most seats, or most votes. - The Scottish National Party (SNP) is forecast to make large gains and may overtake the Liberal Democrats to win third place. Polls have shown they might win more than 40 seats. Labour has ruled out a coalition with the SNP. But the two might strike a less formal agreement. The SNP has ruled out a coalition with the Conservatives. - The UK Independence Party (UKIP) is expected to win only a handful of seats despite their third-place showing in national opinion polls, in part because of the electoral system. They have offered to cut a deal with the Conservatives if Cameron brings forward a planned EU membership referendum to this year. - Smaller parties are expected to win around 20 seats in total and are spread across the political spectrum, making possible alliances hard to predict. A SECOND ELECTION Britain could be forced to hold a second election if the government formed after May 7 collapses. This can be triggered in two ways: - A vote to dissolve parliament which is supported by a two-thirds majority of lawmakers. - A vote of no confidence in the current government, winnable by a simple majority. Under this scenario, the opposition would have 14 days to try and form a government before a second election is called. THE ROLE OF THE QUEEN Queen Elizabeth has the power to dismiss a prime minister or to make a personal choice of successor, but a monarch has not exercised this right since 1834 and the tradition is considered archaic. By long-standing convention the queen does not get involved in party politics, and the formation of the next government is left to the parties to resolve amongst themselves. (Reporting by William James; Editing by Andrew Osborn and Guy Faulconbridge, Larry King)