United Kingdom Says it Will Now Examine M&A Deals

United Kingdom Prime Minister Boris Johnson recently announced that the government will vet M&A deals in the tech sector (and other areas) to make certain no unwelcome threats sneak into the United Kingdom’s fragile economy.

National Security and Investment Bill

Johnson’s administration is introducing the National Security and Investment Bill. The legislation says its aim is to “strengthen the ability of the United Kingdom ability to investigate and intervene in mergers, acquisitions and other types of deals that could threaten our national security,” including deals related to the telecoms, IT and AI sectors.

National Security Threatened by Hostile Actors

The United Kingdom and its businesses face continued and broad-ranging hostile activity. The government seeks to detect those who compromise their national security and that of our allies. Such behaviour left unchecked can cause vulnerability to disruption, unfair leverage, and espionage. Per the bill, the government must be able to fully combat these threats coming from ever more determined overseas actors.

Details of the United Kingdom Bill

But the bill states that “[o]nce the government has decided that there may be a national security concern in a transaction, there will be a detailed review. The government can then take any action it considers necessary and proportionate to address any national security risk.”

United Kingdom Huawei
United Kingdom Huawei
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No More Huawei 5G Equipment

The bill bans United Kingdom mobile providers from buying new Huawei 5G equipment after the end of the year. They must remove all of the Chinese firm’s 5G kit from their networks by 2027.

Sectors Affected in the United Kingdom

The bill will require for investors and businesses to tell the government about “proposed deals in a limited number of sensitive sectors.” Despite claiming to be “limited,” the United Kingdom bill will apply either in full or in part to 17 sectors, including:

  • Autonomous Robotics
  • Communications
  • Computing Hardware
  • Critical Suppliers to Government
  • Critical Suppliers to the Emergency Services
  • Cryptographic Authentication
  • Data Infrastructure
  • Quantum Technologies
  • Satellite and Space Technologies
United Kingdom Strategy
United Kingdom Strategy

Ryan Carpenter serves as Attorney and Managing Director of Carpenter Wellington. Ryan advises clients across a broad set of corporate and commercial matters.

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