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Lords examines National Security and Investment Bill

14 April 2021

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The House of Lords starts report stage, a further check and change, of the National Security and Investment Bill on Thursday 15 April.

The purpose of this bill is to create orders in connection with national security
risks that arise from the acquisition of control over certain entities and assets.

Members are expected to discuss changes on topics including the risk to national security posed by climate change and guidance for the higher education and research sector.

Committee stage day three: Tuesday 16 March

Members discussed subjects including disclosure of information to countries with reciprocal agreements, review of business loans and grants distributed in response to COVID-19 and climate, environment and ecological security.

Lords committee stage day two: Tuesday 9 March

Members discussed a rage of topics, including acquisition of land near sensitive sites, minority investor veto rights and assets wholly controlled within UK higher education and research institutes.

Committee stage day one: Tuesday 2 March

Members discussed a range of topics, including government powers to declare transactions as void, protection for UK businesses from international competition and trigger event timelines.

Lords second reading: Thursday 4 February

Members discussed a range of subjects highlighted by the bill, including the growth of skills sets to deal with rapidly changing technologies, increased bureaucracy and the impact on new and existing small businesses

Lord Callanan (Conservative), Parliamentary Under Secretary in the Department for Business, Energy and Industrial Strategy, opened the debate and responded on behalf of the government.

Speakers included the chair of the National Trading Standards Board and the former chair of the National Security Forum.

Lord Woodley (Labour), non-executive director of UIA (Insurance) Ltd, made his maiden speech, the first speech by a member in the chamber.

National Security and Investment Bill

This bill aims to establish a new statutory regime for government scrutiny of investments for the protection of national security.

Provisions of the regime include:

  • government powers to issue notices to call-in in acquisitions of control over qualifying entities or assets ("trigger events") to undertake a national security assessment
  • duty of the government to publish a statement on usage of call-in notices
  • a mandatory notification system requiring proposed acquirers of certain shares or voting rights in specific entities to obtain government clearance
  • government powers to amend the acquisitions which fall within scope of the mandatory notification system
  • a voluntary notification system to encourage notifications from parties that their trigger event may raise national security concerns
  • remedies to address risks to national security, including sanctions for non-compliance and legal challenges
  • interaction with the Competition and Markets Authority.

Additionally, the bill amends the overseas disclosure gateway in the Enterprise Act 2002 to remove the restriction on UK public authorities to disclose information in connection with a merger investigation.

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