Ministers seek powers to block foreign takeovers retrospectively

New bill to stop hostile actors investing in the UK to be passed through Parliament

A finger about to press a Huawei logo in a dark room

A new bill that could potentially give the government powers to retrospectively block foreign takeovers of UK companies is being passed through the House of Commons on Wednesday. 

The new legislation will update the government's current powers, which are almost 20 years old.

With the National Security and Investment Bill, ministers will be able to fully scrutinise interest from overseas, impose conditions or, as a last resort, block any deal in any sector where it deems there is an unacceptable risk to national security. This also includes powers to reverse any deal made within five years. 

There is a suggestion the Bill will be used to prevent investment from countries like China, with companies being used by its government to access UK networks. Some conservative backbenchers are reportedly for amendments thar make it easier to prevent takeovers by foreign companies accused of being involved in human rights abuses.

"The UK remains one of the most attractive investment destinations in the world and we want to keep it that way," said business secretary Alok Sharma. "But hostile actors should be in no doubt - there is no back door into the UK."

The proposals come at a time of heightened political concerns over both Chinese ownership of key segments of the economy and also the UK's dependencies on foreign suppliers, which has been further revealed during the pandemic.

A number of Conservative ministers want the government to make it harder for Chinese companies to buy strategic British firms, particularly after they successfully forced the government to u-turn and ditch Huawei's 5G technology for the UK's networks.

The chairman of PwC, Kevin Ellis, suggested the bill would provide "much-needed certainty and transparency to investors and businesses" but he also stressed that it was "vital" that the UK continued to be an attractive destination for foreign investment.

"While we shouldn't underestimate the UK's attractiveness for investment, competition for foreign direct investment is getting much fiercer," he said. "Across all industries and markets the bar is being raised and we can't rely on existing skills, historical relationships or legacy perceptions to drive future success."

Featured Resources

BCDR buyer's guide for MSPs

How to choose a business continuity and disaster recovery solution

Download now

The definitive guide to IT security

Protecting your MSP and your customers

Download now

Cost of a data breach report 2020

Find out what factors help mitigate breach costs

Download now

The complete guide to changing your phone system provider

Optimise your phone system for better business results

Download now

Recommended

Google’s about to push everyone into two-factor authentication
Security

Google’s about to push everyone into two-factor authentication

6 May 2021
Defense Dept. expands vulnerability disclosure program to all publicly accessible defense systems
ethical hacking

Defense Dept. expands vulnerability disclosure program to all publicly accessible defense systems

5 May 2021
Security researchers take control of a Tesla via drone
ethical hacking

Security researchers take control of a Tesla via drone

5 May 2021
Best free malware removal tools 2021
Security

Best free malware removal tools 2021

5 May 2021

Most Popular

Dell patches vulnerability affecting hundreds of computer models worldwide
cyber security

Dell patches vulnerability affecting hundreds of computer models worldwide

5 May 2021
16 ways to speed up your laptop
Laptops

16 ways to speed up your laptop

29 Apr 2021
KPMG offers staff 'four-day fortnight' in hybrid work plans
flexible working

KPMG offers staff 'four-day fortnight' in hybrid work plans

6 May 2021