The UK plans sweeping powers to intervene in foreign takeovers of British assets if deemed a threat to national security.
A draft law, published yesterday, would expand the range of transactions open to government intervention, the UK Department for Business, Energy and Industrial Strategy said.
There would be scope for fines and retroactive interventions in deals that complete after the bill’s publication — a potentially controversial provision that critics said could deter investors.
The proposed legislation covers sectors including defense, energy and transport, as the government seeks to stop British companies, infrastructure and intellectual property falling into “hostile” ownership.
At the same time, the department said the new scrutiny process would be “slicker” than at present, by imposing set timeframes within which ministers must come to a decision.
“The UK remains one of the most attractive investment destinations in the world and we want to keep it that way,” British Secretary of State for Business, Energy & Industrial Strategy Alok Sharma said in a statement. “But hostile actors should be in no doubt — there is no backdoor into the UK.”
Under the National Security and Investment Bill, foreign buyers from all countries purchasing British assets in 17 sectors would be obliged to notify the government of the transaction.
Only some deals in those sectors would be covered, and a separate consultation would determine the full scope of the law.
Ministers would then have 30 days to either allow a transaction to proceed or call it in for further scrutiny on national security grounds.
If that path is chosen, the business secretary would have a further 30 days to make a decision, extendable by another 45 days in the most complex cases.
Punishments for non-compliance with the new regime includes five years imprisonment and fines of as much as 5 percent of global turnover or ￡10 million (US$13.3 million) — whichever is greater.
Transactions subject to mandatory notification that take place without being cleared would be legally void, the department said.
Conditions imposed on sensitive deals could include limits on the size of shareholdings by foreign investors, restrictions on access to commercial information and limits on access to certain projects, it said.
The department has in the past also imposed conditions on pensions and investment.
Once a deal is cleared, ministers would not be able to revisit it — unless inaccurate information was provided.
However, as reported last month by Bloomberg, there are some retroactive elements to the legislation.
Ministers would have five years to scrutinize transactions in the wider economy beyond the 17 sectors.
They would have powers to unpick them if they are judged a threat to national security — a provision the government said is in line with French, Italian and German practice.
The retroactivity would apply from yesterday, so the government would not be able to intervene in already completed deals.
The department estimates that more than 1,000 deals a year might be subject to the new notification requirement, with 70 to 95 called in for further scrutiny and about 10 requiring some sort of remedy.
Until now, interventions have been governed by the 2002 Enterprise Act, which allows government action when a proposed merger would affect media plurality, national security or public contracts.
The department made changes in 2018, which removed thresholds on market share and turnover for some companies, but the new draft legislation would apply across all sectors.
The US dollar was trading at NT$29.7 at 10am today on the Taipei Foreign Exchange, as the New Taiwan dollar gained NT$1.364 from the previous close last week. The NT dollar continued to rise today, after surging 3.07 percent on Friday. After opening at NT$30.91, the NT dollar gained more than NT$1 in just 15 minutes, briefly passing the NT$30 mark. Before the US Department of the Treasury's semi-annual currency report came out, expectations that the NT dollar would keep rising were already building. The NT dollar on Friday closed at NT$31.064, up by NT$0.953 — a 3.07 percent single-day gain. Today,
‘SHORT TERM’: The local currency would likely remain strong in the near term, driven by anticipated US trade pressure, capital inflows and expectations of a US Fed rate cut The US dollar is expected to fall below NT$30 in the near term, as traders anticipate increased pressure from Washington for Taiwan to allow the New Taiwan dollar to appreciate, Cathay United Bank (國泰世華銀行) chief economist Lin Chi-chao (林啟超) said. Following a sharp drop in the greenback against the NT dollar on Friday, Lin told the Central News Agency that the local currency is likely to remain strong in the short term, driven in part by market psychology surrounding anticipated US policy pressure. On Friday, the US dollar fell NT$0.953, or 3.07 percent, closing at NT$31.064 — its lowest level since Jan.
The New Taiwan dollar and Taiwanese stocks surged on signs that trade tensions between the world’s top two economies might start easing and as US tech earnings boosted the outlook of the nation’s semiconductor exports. The NT dollar strengthened as much as 3.8 percent versus the US dollar to 30.815, the biggest intraday gain since January 2011, closing at NT$31.064. The benchmark TAIEX jumped 2.73 percent to outperform the region’s equity gauges. Outlook for global trade improved after China said it is assessing possible trade talks with the US, providing a boost for the nation’s currency and shares. As the NT dollar
The Financial Supervisory Commission (FSC) yesterday met with some of the nation’s largest insurance companies as a skyrocketing New Taiwan dollar piles pressure on their hundreds of billions of dollars in US bond investments. The commission has asked some life insurance firms, among the biggest Asian holders of US debt, to discuss how the rapidly strengthening NT dollar has impacted their operations, people familiar with the matter said. The meeting took place as the NT dollar jumped as much as 5 percent yesterday, its biggest intraday gain in more than three decades. The local currency surged as exporters rushed to
RSS