U.K. May Tighten Takeover Laws to Curb Foreign Influence
The U.K. government is preparing to introduce legislation that would force British companies to report attempted takeovers that could give rise to security risks, The reporter said.
Company directors that fail to observe the rules could face fines, disqualification, or jail, the newspaper said, without saying where it obtained the information.
Prime Minister Boris Johnson also wants academic partnerships and research projects to be included under the rules, reflecting his concern that the country’s cash-strapped universities are looking to tie up with overseas companies.
While the measures were flagged in the Queen’s Speech to parliament in December and Johnson’s predecessor Theresa May drew up similar plans, the timing of the article suggests Downing Street is keen to push the legislation through as it seeks to negotiate how it will trade with European Union and as relations with Beijing sour.
Johnson’s administration is looking at ways to reduce its reliance on China’s Huawei Technologies Co. for the U.K.’s fifth-generation mobile network, a stance that potentially could affect billions of pounds of investment in an economy currently staring down its worst recession in centuries.
The Sunday Times reported China’s ambassador to the U.K. as saying that the Huawei issue is being regarded as a “litmus test” of how much Britain wants to do business with China. Among the high-profile projects potentially at risk: the nuclear plants at Hinkley Point and Sizewell.
In an attempt to quieten an ever-louder clamor from lawmakers complaining about the company’s motives for doing business in Britain, Huawei is planning an ad campaign from Monday highlighting its involvement with the U.K. over the past two decades.
Victor Zhang, Huawei’s vice-president, told the Financial Times the company was not controlled by Beijing and that it was 100% owned by its employees.