National Security regime

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The National Security and Investment Act 2021 (the “NSI Act”) received Royal Assent on 29 April 2021 and came into force on 4 January 2022.

The NSI Act gives the Secretary of State for the Department of Business, Energy & Industrial Strategy (“BEIS”) the power to review a transaction and make an order preventing, remedying or mitigating a national security risk. There is a new Investment Security Unit within BEIS that will review transactions. The NSI Act introduces a mandatory notification regime for trigger events involving acquisitions in 17 specific sectors (the “Mandatory Sectors”) (including advanced robotics, artificial intelligence, communications, computing hardware, data infrastructure and energy – to name but a few).

The BVCA has engaged with BEIS on this Bill since its early inception – having responded to the consultations in the 2017 Green Paper, the 2018 White Paper, the consultation on the sectors in scope of the mandatory regime and more recently the Section 3 Statement, as well as engaging in other correspondence and meetings with BEIS and engaging with members of the House of Lords.

The BVCA joined the NSI Act expert panel in April 2021 to provide feedback on a number of areas of the new regime and joined a number of meetings with BEIS and ministers to discuss this feedback. This work will continue into 2022 and as the regime takes shape and we would welcome feedback from members.

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