On 4th January 2022, the National Security and Investment Act come into force.
Investors acquiring a building or an interest in an entity which owns a building, where:
- the main purpose of the building is to host active telecommunications equipment; and
- that active equipment is used by a public electronic communications network or service with a UK turnover of at least £50 million,
should be aware that they must notify the government of this transaction and obtain the government's approval to this acquisition. Failure to do so, will mean the acquisition is void.
This is subject to:
- the entity / asset being acquired having a connection to the UK; and
- the level of control being acquired passing a specified threshold.
The rationale behind this notification / approval requirement is to enable the government to scrutinise the acquisition to determine if it could pose a risk to national security.
Whilst this is another telecoms linked hurdle for property investors to clear, the scope of the Act in the context of telecoms is limited. The government guidance makes it clear that the sale of a building / entity owning a building, which has a 5G small cell on its roof (for example), where the remainder of the building is residential or for unrelated commercial purposes, would fall outside the mandatory notification obligation.