Foreign Affairs Committee launches inquiry into FCO’s role in blocking foreign asset stripping in the UK

The Foreign Affairs Committee today launches a new inquiry into the Foreign & Commonwealth Office’s role in blocking foreign asset stripping of UK companies, especially where there may be national security risks.

This inquiry will examine how the FCO assesses whether a potentially hostile party is seeking to secure significant influence or control over a UK company and in what circumstances the FCO should intervene.

The Committee will also focus on what safeguards are required in the forthcoming National Security and Investment Bill to ensure that the FCO has a full role in the decision-making process in relation to interventions.

Chair of the Foreign Affairs Committee, Tom Tugendhat MP, said:

“Over the past few years, we’ve witnessed the UK Government seemingly sit back and watch as a number of our country’s tech firms have been snapped up by other nations.

“Whilst busying ourselves with taking back control from Brussels, we’ve lost sight of how vital these companies are and how great the risk of losing them is.

The transfer of some of our best tech firms into foreign hands comes at a great cost – innovation slips through our fingers and countless people’s jobs are at risk.

“We want to see the Government sit up and pay attention, especially when these takeovers could be seen as a potential threat to national security or an attempt by a hostile party to gain leverage in key sectors of our economy. When do several small takeovers amount to the capture of a whole sector and what can we do to stop it?

“The Government’s main concern right now is winning the battle against coronavirus and so it should be. However, we must not allow those who would seek to benefit financially or politically from this grave distraction the means to do so.”

The Committee welcomes written evidence on:

• What role should the FCO play in guiding UK Government decisions on intervening in foreign takeovers of UK companies, where there may be national security risks?
• How does the FCO assess whether a potentially hostile party is seeking to secure significant influence or control over a UK company?
• In what circumstances should the FCO seek to intervene in decisions on takeovers on the grounds of the impact on bilateral relations or the UK’s geopolitical interests?
• What safeguards are required in the forthcoming National Security and Investment Bill to ensure that the FCO has a full role in the decision-making process in relation to interventions?

Form of written evidence:

Submissions should be no longer than 3,000 words. The main body of any submission should use numbered paragraphs. Each submission should contain:

• a short summary, perhaps in bullet point form;
• a brief introduction about the person or organisation submitting evidence, for example explaining their area of expertise or experience;
• any factual information from which the Committee might be able to draw conclusions, or which could be put to other witnesses;
• any recommendations for action by the Government or others which the submitter would like the Committee to consider for inclusion in its report to the House.

Submissions should be in mailable format such as MS Word (not PDFs) with no use of colour or logos. Guidance on submitting written evidence and data protection information is available here: Guidance on submitting written evidence. 

Deadline for submissions

The Committee is asking for initial written evidence to be submitted through the Committee’s web portal by midnight on 29 May.

It is recommended that all submitters familiarise themselves with the Guidance on giving evidence to a Select Committee of the House of Commons which outlines particulars of word count, format, document size, and content restrictions. 

Diversity

We encourage members of underrepresented groups to submit written evidence. We aim to have diverse panels of Select Committee witnesses and ask organisations to bear this in mind when we ask them to choose a representative. We are currently monitoring the diversity of our witnesses.

FURTHER INFORMATION:

Committee Membership is as follows:

Tom Tugendhat (Chair) (Tonbridge and Malling), Conservative; Chris Bryant (Rhondda), Labour; Chris Elmore (Ogmore), Labour; Alicia Kearns (Rutland and Melton), Conservative; Stewart Malcom McDonald (Glasgow South), Scottish National Party; Ian Murray (Edinburgh South), Labour; Andrew Rosindell (Romford), Conservative; Mr Bob Seely (Isle of Wight), Conservative; Henry Smith (Crawley), Conservative; Royston Smith (Southampton, Itchen), Conservative; Graham Stringer (Blackley and Broughton), Labour.