A new law gives the British government the power to stop takeovers of 17 sectors of the economy.
The UK government’s National Security and Investment (NSI) Act has come into force, giving the state new powers to intervene in business and investor takeovers across 17 critical areas of the economy.
The government issued a statement Tuesday morning confirming that the NSI Act will come into effect immediately. According to the statement, it was called “NSI Act”. “the biggest shake-up of the UK’s national security regime for 20 years.”
The law gives ministers the ability to scrutinize and intervene in acquisitions made by anyone, including businesses and investors, where there is potential harm to the UK’s national security.
The document identifies 17 areas in the economy that require ministers to have greater control over acquisitions. The ministers will be empowered to secure deals in many areas including advanced robotics and artificial intelligence, civil nuclear sectors, transport, quantum tech, and defense.
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There were already some rights that the government could use to block foreign-led takeovers. This would affect economic stability, media plurality and pandemic response.
“The UK is world-renowned as an attractive place to invest but we have always been clear that we will not hesitate to step in where necessary to protect our national security,”Kwasi Kwarteng, Business Secretary, stated in a statement.
This move is taking place amid controversy over the American multinational Nvidia’s $40 billion (54 billion USD) acquisition of British chipmaker ARM.
US multinationals and private equity have always found UK businesses attractive. Government attention was drawn to recent deals with defense suppliers Ultra Electronics, and Meggitt.
US-led takeovers have also targeted other industries like pharmaceuticals.
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