In brief
On 22 July 2025, the UK Cabinet Office made three major announcements relating to the National Security and Investment Act ("NSI Act"), which embodies the UK's foreign direct investment ("FDI") screening process.
Firstly, the UK Government confirmed its intention to create exemptions to the NSI Act regime for certain types of internal reorganisations. Secondly, it launched a planned consultation on a draft of proposed changes to the notifiable sectors, including the introduction of three new standalone mandatory notification sectors. Finally, the Government also published its latest annual report on the operation of the regime.
These announcements signal some of the most significant actual and contemplated changes to the regime since the NSI Act – the UK's first, standalone foreign investment screening regime – came into force more than three years ago. Together with the recently published Industrial Strategy and National Security Strategy papers, the proposals mark an important step by the current Labour Government towards creating a more reliable and up-to-date FDI screening regime in the UK, in line with their main objective of achieving economic growth.
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Daniel Quirk and William Guy, Trainee Solicitors, have contributed to this legal update.