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The UK wants to clamp down on ‘malicious’ foreign buyers snapping up promising firms in areas like AI and quantum computing

The UK government has announced a proposed overhaul of local takeover laws that could prevent prospective tech giants being sold to foreign buyers.

The proposed measures would require foreign buyers in 17 key industries, including AI, quantum computing, autonomous robots, and data infrastructure, to check in with a newly-formed government department about their plans.

The idea is to ward off potential threats to the UK’s national security, and prevent “malicious” entities from enmeshing themselves in sensitive infrastructure and technologies.

Directors of businesses that fail to comply could face fines of up to £10 million (or around $13 million), or their companies be forced to pay up to 5% of their annual turnover.

The National Security and Investment Bill is expected to be tabled in Parliament on Wednesday, and it will need to pass several stages before it becomes law.

“Hostile actors should be in no doubt – there is no back door into the UK,” business secretary Alok Sharma said. “This bill will mean that we can continue to welcome job-creating investment to our shores, while shutting out those who could threaten the safety of the British people.”

The proposals would also give ministers the power to unwind deals five years after they take place, if the correct procedures aren’t followed.

“We are taking a five-year retrospective power to call in transactions in the wider economy which were not notified to us but may raise national security concerns, both of which are similar to the powers under the French, German and Italian regimes,” the government said in a statement.

“However, these powers will not apply to transactions which took place prior to the Bill’s introduction to Parliament, so businesses and investors have certainty about historical deals.”

Under the proposals ministers could also limit the number of shares a “risky” investor can acquire, and restrict a buyer’s access to sensitive information and sites.

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As well as preventing a future unicorn from being sold to the US, the measures are also thought to be designed to limit the potential for Chinese business interests.

The government is under continued pressure from China hawks within its own party, who have warned of China as a risk to the UK’s national security. Prime Minister Boris Johnson has, under pressure from this group, reversed a decision to allow Chinese tech giant Huawei to supply kit to the UK’s 5G networks.

And the proposals come amid increased focus on keeping the UK’s most promising firms from being sold off to foreign buyers, hostile or not. Business Insider previously reported Dominic Cummings, Prime Minister Boris Johnson’s most senior advisor, hoped to help build a “$1 trillion tech company” in the UK, and was conscious that AI research firm DeepMind and chip designer ARM were sold off to Google and SoftBank, then Nvidia respectively.

Here’s the full list of 17 industries which may be impacted by Wednesday’s proposals if they become law:

1. Civil Nuclear
2. Communications
3. Data Infrastructure
4. Defence
5. Energy
6. Transport
7. Artificial Intelligence
8. Autonomous Robotics
9. Computing Hardware
10. Cryptographic Authentication
11. Advanced Materials
12. Quantum Technologies
13. Engineering Biology
14. Critical Suppliers to Government
15. Critical

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Source:  Fresh News Now (Business Insider).  Fresh News Now,  The UK wants to clamp down on ‘malicious’ foreign buyers snapping up promising firms in areas like AI and quantum computing…

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