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<\/a><\/p>\nHow will the new Act affect UK-China collaboration?<\/h4>\n
Under the Act, investors and businesses have a legal obligation to notify the government about certain acquisitions across 17 sensitive areas of the economy:\u00a0\u00a0<\/span><\/p>\n\n- Advanced materials<\/li>\n
- Advanced robotics<\/li>\n
- Artificial intelligence<\/li>\n
- Civil nuclear<\/li>\n
- Communications<\/li>\n
- Computing hardware<\/li>\n
- Critical suppliers to government<\/li>\n
- Cryptographic authentication<\/li>\n
- Data infrastructure<\/li>\n
- Defence<\/li>\n
- Energy<\/li>\n
- Military and dual-use<\/li>\n
- Quantum technologies<\/li>\n
- Satellite and space technologies<\/li>\n
- Suppliers to the emergency services<\/li>\n
- Synthetic biology<\/li>\n
- Transport<\/li>\n<\/ul>\n
This could have an impact on UK companies looking to collaborate with Chinese companies and on UK start-ups seeking Chinese capital investment.<\/p>\n
Depending on the nature of the acquisition, the notification may be mandatory, such as in the acquisition of a controlling right or interest in a qualifying entity above a certain threshold or voluntary, such as in the acquisition of a qualifying asset, including intellectual property (IP).\u00a0 <\/span>Interestingly, the term \u201cqualifying entity\u201d applies not only to UK entities but also to non-UK entities carrying out activities in the UK or supplying goods and services to the UK.\u00a0 <\/span>From an IP perspective, the Act could be interpreted as applying to non-UK IP rights that can be enforced in the country of origin to restrict the supply of goods and services to the UK.<\/p>\nNon-compliance with the Act will result in the acquisition being deemed void and the offender risking exposure to civil and criminal penalties.\u00a0 <\/span>A civil penalty could be as much as 5% of an organisation\u2019s global turnover or \u00a310 million, whichever is greater.<\/p>\n