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National Security and Investment Bill - New Clause 7
20 January 2021
Lead MP
Stewart Hosie
Debate Type
Bill Debate
Tags
No tags
Other Contributors: 29
At a Glance
Stewart Hosie raised concerns about national security and investment bill - new clause 7 in the House of Commons. Other MPs contributed to the debate.
How the Debate Unfolded
MPs spoke in turn to share their views and ask questions. Here's what each person said:
Lead Contributor
Opened the debate
This new clause would require the Government to publish an 'Annual Security Report' to the Intelligence and Security Committee of Parliament. The report must include details about the jurisdiction of the acquirer, national security risks posed in transactions for which there were final orders, particular technological or sectoral expertise being targeted, and any other instructive information on national security threats uncovered through reviews under this Act.
Rosie Winterton
Lab
Stockport
Ms Winterton moved several new clauses including one that would require the Government to produce a report setting out the impacts of this legislation on Small to Medium Enterprises and early-stage ventures, along with relevant guidance. She also proposed creating a grace period for SMEs if offences were committed within six months after the Bill’s passage.
Julian Lewis
Con
New Forest East
Proposes that a special report containing relevant classified national security material should be prepared for the ISC. Emphasises the need for parliamentary oversight given the sensitive nature of issues involved, such as intelligence agencies' work. Cites legal basis under which ISC functions, stressing its flexibility to oversee new units related to intelligence or security matters.
Chi Onwurah
Lab
Newcastle upon Tyne Central and West
Argues for the necessity of the Bill to address national security concerns highlighted by Labour over years. Supports new clauses 5, 6, and amendment 7 aimed at improving clarity in assessing threats, easing burdens on SMEs, and ensuring effective scrutiny through an annual report to Parliament’s Intelligence and Security Committee.
Thomas Tugendhat
Con
Tonbridge
Argues for the need of a framework defining national security without constraining future adaptability. Mentions significant past decisions like DeepMind's sale to Google and Arm’s sale to SoftBank as strategic mistakes that underscore the importance of adapting laws to changing circumstances. Advocates for new clause 4, which aims at enabling the Government to look at foreign investment more rigorously.
Kevan Jones
Lab
Durham, UK
[INTERVENTION] Congratulates Thomas Tugendhat on his Committee’s report and expresses concerns about decisions made by government departments, highlighting the Ministry of Defence's decision to buy E-7 Wedgetail aircraft from Boeing.
Stephen Kinnock
Lab
Aberavon
Speaks in favour of new clause 5, emphasising the need to protect Britain's national security from hostile business takeovers and investment vehicles that are not aligned with UK values. He highlights the impacts of the pandemic on economic vulnerability, the rise of China as a threat to sovereignty, and the failure to protect critical national infrastructure sectors such as chemicals, defence, finance, health, and water. Kinnock also raises concerns about foreign state involvement in takeovers and calls for clearer definitions in the Bill.
Rosie Winterton
Lab
Sheffield Central
Interjects to inform Stephen Kinnock that there are more speakers and suggests limiting his speech to about 10 minutes, as he has already spoken for 15 minutes.
Jamie Stone
Lib Dem
Caithness, Sutherland and Easter Ross
Supports the amendment to place an annual security report before the Intelligence and Security Committee. Expresses concerns over Russian and Chinese threats, particularly regarding hostile foreign acquisitions like DeepMind's sale to Google and Arm’s acquisition by NVIDIA. Advocates for broadening the public interest test to include issues such as child labour, modern slavery, and Uyghur rights in trade deals. Highlights the importance of cross-party agreement on defence matters.
Opposes new clause 5 due to concerns about defining national security too narrowly, which could limit the Government's flexibility in addressing evolving threats. Provides a hypothetical example of a small social media firm being potentially acquired by hostile foreign entities for propaganda purposes, highlighting the difficulty in predicting and defining future national security issues.
Kevan Jones
Lab
Durham
Supports the Bill, highlighting its importance in protecting national security and critical infrastructure. Argues for new clause 7 to provide external oversight of decisions made under the Bill through the Intelligence and Security Committee (ISC), which already has the necessary clearance levels. Discusses challenges with obtaining sensitive information from the Cabinet Office and suggests the need for robust oversight mechanisms.
Sam Tarry
Lab
Ilford South
Labour supports the Bill but proposes amendments to make it more robust. It highlights the need for a comprehensive industrial strategy and criticises the Conservative government's failure to prioritise national security over economic interests, citing examples such as ARM Holdings' takeover by SoftBank. The amendment would bring the UK in line with international allies and ensure that merger control is accountable.
Andrew Griffith
Con
Arundel and South Downs
Griffith argues against the proposed amendments, stating they would harm investment and economic growth. He emphasises the importance of foreign direct investment in creating jobs and fostering innovation across various sectors such as clean energy, artificial intelligence, and FinTech. Griffith urges Labour to withdraw its amendments to maintain the UK's attractiveness for international investors.
Jim Shannon
DUP
Strangford
Supports the Bill's objectives to protect national security while recognising concerns about over-prohibition for potential investors. Emphasises the need for clear legislation detailing parameters and trigger events for Secretary of State intervention, ensuring transparency for businesses and foreign investors. Highlights Northern Ireland’s potential for cyber investment due to its favourable business rates and skilled workforce.
Bob Seely
Con
Isle of Wight
Seely emphasised that national security is broader than just defence and espionage, encompassing economic, energy, and technological threats. He referenced the Henry Jackson Society report on Five Eyes supply chain reliance on China, noting over a quarter of British supply chains are dominated by China in 229 critical categories. He argued for the inclusion of factors such as national resource, critical supply chain, and critical infrastructure to help guide good decisions in the national interest.
Kim Johnson
Lab
Liverpool Riverside
Supports the Bill's aim to protect UK jobs and industries from foreign, hostile acquisitions but calls for a robust industrial strategy that includes investment in tech sectors and strategic intervention powers like those in France and the USA. Emphasises the need to retain high-growth companies in the UK.
Argues for enhanced protection of national security, stressing that the Bill's measures are necessary to prevent foreign investors from obtaining critical technologies which could be used against the UK. Supports the investment security unit and the Secretary of State’s power to call in other businesses if national security is at risk.
Matt Western
Lab
Warwick and Leamington
Supports the Bill and new clauses. Emphasises the importance of national security for Labour. Criticises past governments for their slow response to threats such as Huawei, Pfizer-AstraZeneca merger, Google-DeepMind, Nvidia-Arm technology takeover, GKN-Melrose takeover, Cobham aviation acquisition. Highlights testimonies from experts like Charles Parton and Sir Richard Dearlove regarding the Chinese threat and the need for a broader definition of national security.
John Hayes
Con
South Holland and The Deepings
Mr. Hayes supports the National Security Bill, emphasising its relevance to national wellbeing and security in the face of malevolent forces. He commends new clauses 4 and 5 for their approach to assessing risk but suggests more clarity on the circumstances under which risks will be assessed. Mr. Hayes also highlights the importance of a framework rather than specific guidelines. Additionally, he stresses that all government departments must work together to ensure security and resilience. He calls for better oversight through new clause 7, suggesting an annual report detailing when and why the Government acted. However, he acknowledges the need for rapid response without always seeking parliamentary approval.
Nadhim Zahawi
Con
South Holland and The Deepings
The Secretary of State has laid a statement with the Bill that identifies three types of risk: target risk, trigger event risk, and acquirer risk. He argues against overly specific definitions of national security to ensure flexibility in addressing evolving risks. The Government aims for technocratic decisions without political interference.
Kevan Jones
Lab
North Durham
Thoughtful contributions were made regarding the oversight of sensitive and confidential information that should fall within the remit of the Intelligence and Security Committee. Emphasised the importance of ensuring the scope of the Bill was appropriate, particularly for smaller businesses and academia.
Kwasi Kwarteng
Con
Spelthorne
Paid tribute to his predecessor Alok Sharma for his work on the Bill. Emphasised the need for safeguards against exploitation in international investment, stressing that the Bill provides appropriate national security protections without changing the UK's commitment to free trade and inward investment.
Nigel Evans
Con
Rhondda
Congratulated Kwasi Kwarteng on his new role as Secretary of State for Business, Energy and Industrial Strategy.
Nigel Evans
Constituency Party
Chorley
Congratulated President Biden and Vice-President Harris on their inauguration, expressing confidence that they will receive a warm welcome in the UK. Did not comment specifically on the Bill or amendments.
Julian Lewis
Con
New Forest East
Welcomes the Bill but suggests formalising ISC oversight to improve its effectiveness. Emphasises that the ISC's role should be formalised for better scrutiny and security, despite it being a positive step forward.
Congratulates the Secretary of State on his promotion and acknowledges the work done by staff and Members. Stresses that while the Bill is necessary and overdue, businesses must be supported to grow despite new burdens.
Praises the improvement in national security through the Bill and supports ISC oversight of sensitive investment decisions. Suggests close links between the new unit and security services for effective decision-making.
Congratulates the Secretary of State and welcomes the recognition that the ISC has a role in scrutiny. Argues for formalising this mechanism to ensure parliamentary oversight, even as Ministers change over time.
Simon Baynes
Con
Clwyd South
The Bill ensures necessary powers to scrutinise business transactions for national security, provides certainty and transparency for businesses and investors, reinforces UK's legal system and regulatory framework, simplifies interaction with Government, addresses small number of transactions that raise national security threats, and updates investment-screening powers from 2002.
Jim Shannon
DUP
Strangford
Supports the Bill for strengthening national security regime. Queries about small independent businesses setting up with American investors, and whether investment will be encouraged despite potential bureaucracy and delays. Asks for assurance that investment in Northern Ireland will not be discouraged.
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