Ministers intervened in EIGHT takeovers by Chinese firms last year

Ministers intervened in eight sensitive takeovers by Chinese investors last year, it was revealed today.

The government action was disclosed in an official report on how new powers to protect the national interest have been used.

Deputy PM Oliver Dowden said the UK did not want to ‘decouple’ from China, but had to be ‘clear-eyed’ that Beijing represented the ‘largest state-based threat’ to economic security. 

Under the National Security and Investment Act 2021, ministers can block or impose conditions on deals seen as a danger to the country’s interests.

The Cabinet Office said it had received 866 referrals in the last financial year, covering areas such as defence, energy, scientific research and communications.

Details of the companies involved are not given, but 65 were ‘called in’ for closer inspection – and around two in five of those involved investors associated with China.

Around a third were connected to the UK and a fifth with the US. Some bids were linked to more than one county.

Mr Dowden said the UK did not want to ‘decouple’ from China, but had to be ‘clear-eyed’

The overwhelming majority were approved in the end, but ‘final orders’ were issued in 15 cases – blocking, unwinding or imposing conditions on the deals.

Eight of the orders were connected to China, four with the UK, and three with the US.

In the foreword to the report, Mr Dowden said it was a ‘light-touch, proportionate regime that offers companies and investors the certainty they need to do business, while crucially protecting the UK’s national security in an increasingly volatile world’.

Separately Mr Dowden told the BBC that the decisions were ‘country agnostic’.

‘I’m very clear that I do not want us to decouple from China, I don’t think it’s in our interest,’ he said.

‘But at the same time, we have to be clear-eyed about protecting our national security, just in the same way that the Chinese are.’

Asked why Chinese deals were disproportionately targeted, Mr Dowden pointed out that China ‘is just a very big investor, globally’. 

‘The second (reason) is, as we set out in our national security review, China represents the largest state-based threat to economic security,’ he went on.

‘So it’s not a surprise that we should look carefully at Chinese transactions. But equally, we look across the board.’

Under the National Security and Investment Act 2021, ministers can block or impose conditions on deals seen as a danger to the country’s interests