In November, the UK Government announced a significant and wide-ranging package of reforms that, if adopted, will both recalibrate and expand its existing powers to assess and intervene in mergers and acquisitions on the grounds of national security.
The proposed reforms are set out in the National Security and Investment Bill and contemplate the introduction of a new national security investment-screening regime that will operate alongside and in addition to the Competition and Markets Authority’s mergers framework under the Enterprise Act 2002.
A new Investment Security Unit, which will sit within the Department for Business, Energy and Industrial Strategy, will be the point of contact for businesses with questions or wishing to notify the Government about transactions.
It is not yet clear when the new regime will come into force. However, current indications are that it will be in the first six months of 2021.
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Under the new regime, the Government will have the power to ‘call in’ acquisitions that are deemed to pose a threat to national security. The call-in mechanism will allow the Government to review non-notified transactions for a period of up to five years post-completion, which is reduced to six months, if the Government has become aware of the trigger event. Whilst separate from the CMA merger control regime, the Bill states that the Unit must consult the CMA before issuing any final orders.