Enterprise Act 2002 (Specification of Additional Section 58 Consideration) Order 2020

Baroness Falkner of Margravine Excerpts

Wednesday 15th July 2020 Lords Chamber

[Baroness Falkner of Margravine (Non-Afl)]

I welcome the inclusion of public health emergencies as a public interest consideration under these measures.

I know that other countries have experience of why these measures are needed; take the recent example of the German biotech firm CureVac, which was in the process of launching an IPO on the NASDAQ this month. According to the Financial Times, the German Government, acting on the basis that the US Government had sought to take over the group in order to secure a supply of a Covid-19 vaccine, bought a 23% stake in it—equivalent to €300 million—through KfW, the state-owned development bank. They were able to do so because German legislation from 2017 allows them to intervene in any acquisition of a German company if it endangers “public order” or “Germany’s fundamental security interests”. The House may be interested to know that several Chinese actors had bought out or tried to buy strategic German firms until that point.

I also want to press the Minister on why our categories of these sectors are so relatively narrow. The German legislation now takes in companies that produce software for power plants, energy and water supply networks, electronic payments, hospitals and transport systems, in addition to the normal national security considerations. The German Government widened their legislation because, as they put it at the time,

“German companies are often forced to compete with businesses in countries that have a ‘less open economic system than ours’.”

No prizes for guessing which country that might be, given the Statement yesterday. I hope that the Minister will take a closer look at what can be done to secure our broader national interests in the forthcoming Bill.