Foreign takeovers of British firms will be easier to block if they threaten national security

Takeovers of British firms by foreign companies will be easier to block if they threaten national security under tough powers proposed by ministers.

Business Secretary Greg Clark is expected to announce proposals today that will allow the Government to intervene on deals affecting a broader range of companies.

There is concern that under current rules, sensitive technology used by smaller yet vital companies or industries such as telecoms can too easily fall into foreign hands.

Measures announced last month already lowered the threshold for the Government to intervene in industries such as those making military products and computing hardware.

Under the plans due to be announced in a White Paper today, ministers will be able to call in deals across the economy that pose national security concerns.

They will then be able to put conditions on the deal or block it. They could even undo a deal where it has taken place. 

The Government has just waved through the sale of Derby-based components maker Northern Aerospace to Chinese-owned Gardner, following concerns about technology falling into Chinese hands. 

Earlier this year it intervened in the sale of engineering company GKN to Melrose, securing a veto over the sale of its prized aerospace arm over the next five years.

After the proposals are outlined today there will then be a 12-week consultation period.