The National Security and Investment Act 2021 (the NSI Act) came into force on 4 January 2022. The NSI Act establishes a new, stand-alone statutory regime for government scrutiny of, and intervention in, acquisitions and investments for the purposes of protecting national security.

The NSI Act obliges UK universities for the first time to consider risks to national security when they transfer ownership of spin-out companies, intellectual property, land, or moveable property such as machinery. The government will be able to impose certain conditions on an acquisition, and in rare instances, it may unwind or block an acquisition completely.

The new rules cover qualifying acquisitions of certain entities and assets, which are likely to affect some parts of the higher education and research sectors. The guidance has listed 17 sensitive areas of the economy, such as advanced materials, robotics, quantum technologies, artificial intelligence and synthetic biology.

Sue Angulatta, Director of R&E quote: “We advise staff to have full awareness of the NSI Act and to familiarise themselves with the 17 sensitive areas listed in the legislation. Guidance and resources have been provided on our staff pages”.

The department for Business, Energy and Industrial Strategy (BEIS) is keen to stress that the UK continues to welcome foreign investment and that these reforms are in line with other countries.

From March the Research Collaboration Advice Team (RCAT) will sit within the BEIS and will act as a source of advice and platform for HEIs to access guidance and support in order to support the integrity of research, protect the security of the UK’s research ecosystem and care for the safety and reputations of researchers working in the UK.

For more information about the National Securities and Investment Act, Export Controls and Sanctions please visit the  Managing risks in Internationalisation page.