Corporate associate Jonathon Gunn authored an article for Acquisitions Daily titled “Fears Over Block to Foreign Investment,” addressing the potential impact of the United Kingdom (U.K.)’s impending National Security and Investment Bill (the “Bill”).
The Bill will update the U.K. government’s rules on reviewing investment activities on national security grounds. Particularly causing distress for foreign investors is recent reporting that the Bill will give the government the power to review and intervene in investment transactions that were completed prior to the Bill taking effect.
In his article, Gunn explains that it’s unlikely that the government will reopen transactions completed prior to the Bill coming into force, except in exceptional circumstances. To determine whether there is a risk of a deal being reopened, investors should consider cross-checking completed deals against the government’s review or “call-in” criteria. If there is reasonable prospect of a call-in, investors should look to demonstrate why the perceived risk to national security is low.
Gunn also discusses further due diligence investors should take going forward in transactions and highlights deal protection mechanisms investors should obtain.