Powers to block foreign takeovers strengthened

Ministers will be handed powers to scrutinise foreign takeovers of businesses to ensure they do not threaten the UK’s ability to tackle future public health emergencies.

They fear that the economic disruption caused by the coronavirus crisis will make firms with critical functions more susceptible to takeovers from “hostile approaches” or “malicious parties”, according to the Department of Business, Energy and Industrial Strategy.

The Government will table changes to the Enterprise Act 2002 in Parliament on Monday in a bid to safeguard national security by protecting key companies and technology.

Ministers would be able to intervene if a business directly involved in a pandemic response, such as a vaccine research firm or protective equipment manufacturer, was eyed for a takeover.

Powers would also be expanded to intervene in mergers in artificial intelligence, cryptographic authentication technology and advanced materials by lowering the threshold for scrutiny to take place.

More comprehensive powers are planned, but the first measures are expected to come into force on Tuesday after being introduced by a statutory instrument.

Business Secretary Alok Sharma said: “These measures will strike the right balance between the UK’s national security and resilience while maintaining our world-leading position as an attractive place to invest – the UK is open for investment, but not for exploitation.

“These powers will send an important signal to those seeking to take advantage of those struggling as a result of the pandemic that the UK government is prepared to act where necessary to protect our national security.”