Key Facts

• UK attracted around $750 billion of foreign direct investment over the past decade.
• This investment helped create 600,000 new jobs across the country.
• In 2019-20 alone, more than 39,000 jobs were created in England due to foreign direct investment projects.
• The Bill aims to address novel ways hostile actors use to bypass current regimes for screening investments.
• Government intends to update legislation to address national security risks from foreign actors.
• Call-in power allows for scrutiny of transactions without size limitations.
• Notification requirement applies to 17 prescribed economic sectors.
• Consultation on refining sector definitions is ongoing.
• Three quarters of a trillion dollars have come into the UK over the past decade due to inward investment.
• Transactions covered by mandatory notification without clearance will be legally void.
• Information requirements for notification are streamlined from 36 pages to one-third of that.
• Government aims to provide clearance for most transactions within 30 working days.
• The regime includes both civil and criminal sanctions, aligning with French and German regimes.
• The UK has the lowest corporation tax rate in the G20.
• The UK ranks fourth in the 2020 global innovation index.
• The UK is one of the top 10 countries for ease of doing business.
• The UK has a world-leading research and development environment.
• The Bill includes a mandatory notification obligation in 17 key sectors.
• It has the potential to impact at least 1,000 notifications per year.
• There is five-year retrospective application for call-in transactions.
• A new investment security unit will be established within BEIS to manage the regime.
• The Bill enables Ministers to add new sectors subject to mandatory notification through delegated legislation.
• There are concerns about the lack of transparency regarding sensitive issues.
• ARM is considered a crown jewel of the British tech sector facing a threatened takeover by Nvidia.
• Miliband has been concerned about legislation regarding foreign takeovers since at least 2010.
• He references past instances such as the Kraft takeover of Cadbury and the threatened Pfizer-AstraZeneca merger.
• Other major industrial economies including France, Germany, Australia, Japan, and the United States have similar strategic interests in certain industries.
• The National Security and Investment Bill is described as long overdue.
• Clauses 32 to 39 deal with penalties, fines, and incarcerations with a scope up to five years.
• China is identified as the single biggest threat to the United Kingdom and the free world.
• Civil-military fusion in China affects every enterprise and company.
• Data harvesting by Chinese firms is linked to state intelligence work under national security law.
• TikTok owner ByteDance has links with the Chinese Communist Government.
• The Henry Jackson Society found that only 23 of 117 Chinese acquisitions over the last decade would have been caught by the Bill.
• The Australian Government used similar legislation to block an acquisition of AVZ Minerals by a Chinese firm.
• Other Five Eyes partners have more extensive national security tests in their legislation.
• The speaker expresses concern about the pressure on the Secretary of State when making final decisions.
• The UK Government's current ability to scrutinise investments on national security grounds is limited under part 3 of the Enterprise Act.
• Other countries, such as the US, Japan, Canada, Sweden, Germany, and France, have tightened their investment security regimes.
• The Bill introduces a mandatory notification scheme for certain sectors and asset types.
• The impact assessment estimates between 1,000 to 1,830 transactions notified per year under the new regime.
• Only 12 transactions were reviewed on national security grounds in the past 17 years.
• The Bill aims to overhaul the UK’s approach to foreign investment.
• The impact assessment suggests a net cost of £43 million to business.
• Microbusinesses developing high-tech intellectual property may be affected by the measures.
• Universities and academia might face inhibited investment due to potential call-ins or risk concerns.
• Notifications are expected up to 1,800 transactions per year.
• Photonics Leadership Group questions BEIS's preparedness for high volume submissions.
• The Bill aims to update the framework for overseeing national security consequences of investments.
• Most nations on earth have a framework for this purpose.
• The US and Australia will likely have tighter restrictions than the UK after the implementation of the Bill.
• The Bill focuses on national security with substantial powers.
• There are concerns about potential administrative consequences from unintended sanctions such as five years’ imprisonment and fines of 5% of turnover.
• The reduction of the turnover threshold for review from £70 million to £1 million was made only two years ago.
• Businesses may find it attractive to notify even when not required due to future Government actions or public interest tests.
• The National Security and Investment Bill aims to scrutinise foreign investment and protect national security.
• ARM-Nvidia takeover is a significant case for scrutiny under the new regime.
• Clause 7 covers corporate vehicles but excludes individuals from its scope.
• Five years of retrospectivity has been adopted by the Government.
• The Bill is crafted to recognize increasing state competition.
• Australia reduced the foreign investment threshold to zero in March.
• France lowered the shareholding required for an inquiry from 25% to 10% in August.
• The US CFIUS regime is one of the most mature in the world.
• The Bill covers 17 sectors affected by rapid technological change.
• DeepMind's sale to Google and ARM's sale to SoftBank are highlighted as strategic losses.
• The UK has double the foreign direct investment compared to France or Germany.
• The de minimis clause is set at zero, but a £1 million threshold could be considered.
• The Bill distinguishes between national interest and national security.
• The consultation process is welcomed by businesses and lawyers.
• FDI has created over 600,000 jobs in the UK.
• In 2018-19, FDI created over 57,000 new jobs.
• The value of inward FDI fell from 10% of GDP in 2016 to 2% in 2018.
• The £4 billion sale of Cobham to a US company is cited as an example where the Bill would not have prevented risks to national security.
• The MOD raised concerns that the merger could allow unauthorized persons access to sensitive information and capabilities.
• The MP suggests transferring decision-making authority from BEIS to a national security committee or sub-committee.
• The new investment security unit is criticized for not having national security at its core.
• Supply chains are complex, long, and diverse, potentially leading to security risks if not properly mapped by security services.
• Universities may face issues with foreign investments, especially from Chinese or Russian companies, in research programmes.
• Concerns about the strategic nature of land acquisition by foreign entities, particularly regarding Government offices.
• Closed hearings involving intelligence are controversial and their application within the Bill is questioned.
• The five-year retrospection period for measures in the Bill is seen as potentially problematic.
• John Redwood supports Minister powers to prevent foreign acquisitions where security matters are concerned.
• Concerns exist about asset-stripping and job losses due to foreign investments.
• The UK runs a massive trade deficit with the EU, leading to reliance on foreign currency.
• There is a £100 billion deficit before the covid-19 pandemic.
• Charlotte Nichols addresses delays in approving Hinkley Point C nuclear project due to fears of Chinese influence since 2016.
• Over 4,500 civil nuclear workers are employed in Nichols' constituency.
• The Bill is partly stimulated by a 2013 ISC report recommending new legislation.
• The Government acknowledges continued and broad-ranging hostile activity from foreign intelligence agencies and state actors.
• John Hayes suggests that future legislation may be needed due to the dynamism of security threats.
• The statement mentions the need for precision in the Bill's scope.
• China is currently being investigated by the ISC regarding national security issues.
• John Hayes refers to a Cabinet Office review with Sir Oliver Letwin focusing on threats to core infrastructure, particularly the energy sector.
• 41% of TikTok’s users are aged between 16 and 24.
• The Bill aims to screen investments that pose a national security risk.
• The Intelligence and Security Committee suggested changes in 2013.
• The ISC report from 2013 recommended legislation which is now being addressed seven years later.
• The Bill aims to protect British industry and national security by requiring notification for business ownership changes in specific sectors.
• Sectors covered include advanced robotics, artificial intelligence, cryptographic authentication, quantum technologies, satellite, and space technologies.
• Government's impact assessment estimates over 1,000 transactions annually, potentially up to 1,800.
• Only 100 people are allocated for handling the transactions.
• The UK's manufacturing sector has collapsed from 30% of GDP in the 1970s to just 9% now.
• Arm, a British tech company, is being sold to Nvidia.
• Cadbury was sold to Kraft without proper consideration for long-term sustainability.
• 57 critical national infrastructure supply chains depend on China.
• The Bill empowers the Secretary of State to impose remedies up to and including blocking transactions posing a risk to national security.
• It covers 17 sensitive areas including computing hardware, quantum technologies, satellite and space technologies.
• Pritchard asks for an undertaking on timely publication of mandated reporting sectors.
• Foreign direct investment in the UK created almost 40,000 jobs in 2019.
• The Office for Investment was recently established.
• Less than 1% of all M&A asset transactions are expected to result in notification under the new bill.
• The amendments proposed include a character test and a public interest test.
• Australia has both a character test and a public interest test based on national security considerations.
• CFIUS, the Committee on Foreign Investment in the United States, involves multiple government departments in decision-making processes.
• There is a concern about Chinese investment in critical infrastructure such as nuclear industry.
• The Bill will affect less than 1% of all mergers and acquisitions in the country.
• Huawei is involved with at least 11 United Kingdom universities as well as six London colleges.
• Only 23 out of 117 Chinese acquisitions of UK corporations in the past decade would have been subject to mandatory notification under the proposed legislation.
• The China National Offshore Oil Corporation controls about 25% of UK oil production and 10% of the country’s energy needs.
• China has a poor track record regarding foreign acquisitions that need scrutiny.
• Less than 20% of Chinese acquisitions are being scrutinised under this legislation.
• The Bill does not prevent companies complicit in human rights violations from investing in the UK.
• Huawei's involvement in core infrastructure is considered a severe threat to national security.
• The Government plans to phase out Huawei by 2027.
• A committee on foreign investment is suggested to promote transparency and parliamentary scrutiny.
• The definition of national security should be expanded to include human rights.
• There are at least 929 UK shell companies involved in 89 corruption and money laundering cases, accounting for £137 billion.
• The Bill's scope can be used to tackle organised crime linked to terrorist organisations.
• The Bill aims to create an investment screening regime similar to those in other nations.
• Less than 1% of mergers and acquisitions are predicted to result in voluntary notification to Government, though some believe this may be underestimated.
• Concerns have been raised about the potential increased administrative burden deterring investors.
• The Bill is seen as precautionary rather than driven by historical evidence.
• There have been discussions about extending the Bill's scope beyond the current 17 sectors.
• Concerns raised about potential retaliatory measures following decisions such as that regarding Huawei.
• The regime for assessing threats through an investment lens was designed in 2002.
• In 2002, President George W. Bush declared Iran, Iraq and North Korea as being the “axis of evil”.
• Between 1,000 and 1,830 notifications may be made under the new regime.
• 100 instances might go through a full national security assessment with remedies imposed on 50 cases.
• Over 600,000 new jobs have been created by foreign direct investment (FDI) projects in the UK over the past decade.
• More than $750 billion has flowed into the UK as a result of FDI projects in the last ten years.
• The Bill will provide powers to block mergers and acquisitions that are national security risks.
• Screening powers will be extended to include assets, intellectual property, and companies.
• The Bill aims to protect sensitive UK assets from hostile actors.
• It includes a turnover requirement for updates to powers.
• Businesses deserve certainty in the regime's decision-making process.
• Publishing statistics on notifications would be welcome.
• The Government have been slow to update legislation compared to other countries like the US, France, and Germany.
• Concerns are raised about foreign acquisitions such as Huawei’s role in the UK’s 5G network and Imagination Technologies’ takeover by Canyon Bridge.
• Ministers failed to modernize the takeover regime to match technological advancements.
• The Bill's sectors subject to mandatory notification are undefined in primary legislation.
• Labour will seek details on how retrospective powers would be applied under the Bill.
• Labour is concerned about the economic and legal consequences for businesses if acquisitions are rendered void after the fact.
• The legal texts in the Bill refer explicitly to national security.
• A proportionate public interest power already exists on the statute book.
• Stephen Phipson, chief executive of Make UK, recognises that the Bill will modernise the UK's approach to investment screening.
• The five-year retrospection period was chosen because six months would be too short to prevent hostile parties from timing out trigger events.
• The Bill does not define the exhaustive content of national security but provides examples like espionage, disruption, destruction, and inappropriate leverage.
• The Government estimates that most transactions will not be affected by the legislation and aims for clearance within 30 days for notifiable investments.
• Public spending on R&D is committed to increase to £22 billion.
• PPE manufacturing in the UK increased from 1% at the start of the pandemic to about 70%.