The new regime is of direct relevance to the Higher Education Institutions (HEIs) which work within many of the areas covered by the Act.
The National Security and Investment Act 2021 (“Act”) came into force on 4 January 2022. It brings in a new regime allowing for Government intervention in transactions on national security grounds, as well as requiring mandatory notifications by acquirers in some instances.
The new regime is of direct relevance to the Higher Education Institutions (HEIs) which work within many of the areas covered by the Act.
The new rules apply to so-called qualifying acquisitions, which has a wide meaning and includes the acquisition of votes or shares in excess of 25% and the acquisition of rights or interests in an asset. It is important to highlight that the rules apply to acquisitions by both UK and overseas acquirers.
The new system introduces a mandatory notification and pre-completion clearance system for the acquisition of shares/voting rights in companies or other entities that operate in any of the 17 specified sectors below:
Failure to make a mandatory notification means that a transaction is void and there are a range of civil and criminal penalties that can be imposed on both companies and individuals that fail to notify. These include fines of up to the higher of £10m or 5% of worldwide turnover and prison sentences of up to five years.
Asset acquisitions and other acquisitions outside of the 17 mandatory sectors are not subject to mandatory notification but can be voluntarily notified. A voluntary notification may need to be considered where possible national security concerns are identified. This assessment is important, as the Secretary of State has call-in powers in respect of qualifying acquisitions and, ultimately, can order the blocking or unwinding of a transaction.
The concept of a qualifying entity or asset is a wide one and includes:
The Government has published Guidance on the application of the Act for HEIs, which includes a summary of how the rules could apply to the sector, and examples of different acquisitions that are within the scope of the Act and could be subject to mandatory notification requirements or called-in.
Examples given include:
The new regime increases the need for all institutions to put in place systems that assess and protect research and academic collaborations.
Helpful and sensible steps are outlined in guidance published by the Centre for the Protection of National Infrastructure and the National Cyber Security Centre. These include:
As with most areas of compliance, the key points are the need for senior level involvement; risk assessment; appropriate policies and procedures on the basis of the risks; communication and awareness raising; and ongoing review and monitoring.
If you would like any assistance with the interpretation or implication of the new guidance in your institution, please contact matthew.woodford@brownejacobson.com.
Partner
matthew.woodford@brownejacobson.com
+44 (0)121 237 3965
There’s been little evidence of interventions or financial management reviews this year and it appears the Education and Skills Funding Agency (ESFA) has re-focussed on financial delivery. It’s also telling that there were no discernible changes to the reporting of financial irregularities in the Academies Trust Handbook 2022.
The Children’s Commissioner, Rachel De Souza, has recently published a report “Beyond the labels: a SEND system which works for every child, every time”, which she intends to sit alongside the DfE’s SEND Review (2019) and SEND Green Paper (2022) and which she hopes will put children’s voices at the heart of the government’s review of SEND system.
There’s greater opportunity than ever for parents, carers and guardians to voice any concerns they have relating to their child’s education and for their concerns to be heard and to be taken seriously. While most staff in schools and academies are conscious of their legal duties relating to complaints management, many are struggling to cope with such a significant increase in the volume of complaints they must manage.
We’re pleased to collaborate with Lloyds Bank, who recently asked us and audit and risk specialists Crowe UK to offer guidance that academy trusts would find helpful when considering setting up a trading subsidiary.
The DfE has published new guidance and opened the application process for window two of the Trust Capacity Fund (TCaF) for 2022/2023, with a fund of £86m in trust capacity funding focused particularly on education investment areas.
The Independent Inquiry into Child Sexual Abuse was established in March 2015. We now have its report. As you would expect with such a broad scope, the report is long and makes a number of far-reaching recommendations. In this article, Dai Durbridge highlights seven of the 20 recommendations, sets out how they could impact on schools and suggests what steps to take now.
Browne Jacobson’s education team has been named as winner of the ‘Legal Advisors to Education Institutions’ category at the Education Investor Awards 2022 for a record sixth time.
Since the new Suspensions and Exclusions Statutory Guidance was published, we have received a lot of questions about the use of managed moves. For the first time, the Statutory Guidance does explain what a managed move is, but in relatively broad terms and does not cover the mechanics of how a managed move should operate.
Over 3000 young people from across the UK and Ireland took part in a virtual legal careers insight event, aimed at making the legal profession more diverse.
Holly Quirk, an associate barrister in Browne Jacobson’s Manchester office, was awarded the Legal Professional of the Year Award at this year’s Manchester Young Talent Awards.
The risk of assault against staff is, sadly, something that all schools need to consider carefully. Here one legal expert explains what they can do to protect staff and ensure they fulfil their duty of care.
Browne Jacobson’s education team has again been confirmed as a national powerhouse after securing five Tier 1 rankings relating to Education in the latest edition of Legal 500 and maintaining a Band 1 UK-wide ranking for Education in Chambers & Partners UK 2023.
Created at the end of the Brexit transition period, Retained EU Law is a category of domestic law that consists of EU-derived legislation retained in our domestic legal framework by the European Union (Withdrawal) Act 2018. This was never intended to be a permanent arrangement as parliament promised to deal with retained EU law through the Retained EU Law (Revocation and Reform) Bill (the “Bill”).
In this article we set out the criteria, expectations and support schools should consider if notified they fall within this new category.
The words “Grammar schools” are once again being whispered in government and the question of whether the creation of new grammar schools will finally be implemented as a central focus to DFE policy has re-surfaced.