A Labour government would give itself new powers to block corporate takeovers that undermine the fight against climate change, under plans unveiled on Tuesday.
Ministers would be able to scrutinise buy-outs of British companies and step in if they believe one could make its more difficult for the UK to keep its commitments under the Paris Agreement.
The powers, which would also extend to other situations such as when a takeover puts human rights at risk, would be an extension of current Tory plans that only allow takeovers to be blocked in the name of “national security”.
The government is legislating for a new National Security and Investment Bill to avoid situations like the Chinese government buying up firms that control essential infrastructure.
But Labour says the restrictions should go further and be spelled out in law so that the decision on whether to move against a particular firm is not left up to the government of the day.
The opposition plan, which will be proposed this week in an amendment to the government’s bill, could see companies with a poor track record on the environment blocked from gaining a foothold in the UK.
The government’s bill is already expected to lead to a significant expansion in state scrutiny of takeovers, imposing new controls in sectors like civil nuclear, communications, defence, energy, transport, and space.
“Ministers have a poor track record on national security, from waving through Huawei’s role in the UK’s 5G network to standing by while acquisitions have seen British businesses stripped for parts,” said Chi Onwurah, the shadow business minister.
“Their history of making dodgy deals with mates also means it would be wrong to leave deciding what is and is not a threat to national security to the whim of Ministers.
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“Labour is calling for clear rules that would set out when foreign acquisitions should be blocked, to back British businesses and protect our country’s best interests.”
Stephen Kinnock, the shadow minister for Asia and the Pacific, said “home-grown businesses” had been left “at the mercy of hostile takeovers”.
The government says its bill is required “to put in place a new regime to reduce national security risks” and that similar systems already exist in the US, Germany, and Japan.
