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On 26 August 2021, the UK Government unveiled a package of announcements which effectively set out its post-Brexit data strategy.

This blog looks at the politics around the costs and benefits of a Brexit divergence dividend in this sector, which the UK Government views as a key area of competitive advantage.

High-Level Content of the

In December 2020, the UK PM set out an ambitious 10 Point Plan for a green industrial revolution, one of the key points of which was the production of 5 GW of low carbon hydrogen in the UK by 2030.  The Plan envisaged hydrogen playing a key role in decarbonising energy-intensive industries and heavy transport and replacing natural gas in domestic heating.

On 17 August the UK Government published its Hydrogen Strategy (together with a number of associated Consultations), which lays the foundations for the UK’s future hydrogen economy and sets out how the UK Government will support innovation and stimulate investment in low carbon hydrogen to meet its 5GW target.

The Hydrogen Strategy is one of a series of strategies the UK government is publishing ahead of the COP26. The UK government has already published its Industrial Decarbonisation Strategy, Transport Decarbonisation Strategy and North Sea Transition Deal and plans to publish its Heat and Buildings and Net Zero Strategies, as well as Number 10’s overarching Net Zero Strategy later this year.

The Hydrogen Strategy

The Strategy is honest about the scale of the challenge and acknowledges that producing 5 GW of hydrogen by 2030 will require rapid and significant scale-up in domestic low carbon hydrogen production. The Strategy also notes the urgent need for a public awareness campaign to overcome consumer concerns about safety.

The Strategy is divided into five main parts:

  • The case for low carbon hydrogen: how it is produced and used; its potential role in meeting net zero; and opportunities for UK firms.
  • A whole-systems approach to the UK hydrogen economy: the roadmap to 2030; the actions needed to develop each element of the hydrogen value chain to reach the 2030 target, Carbon Budget Six and net zero; the market and regulatory frameworks the UK will need to develop a hydrogen market by 2030.
  • The economic opportunities: how the UK will use hydrogen to create jobs in sustainable supply chains; improve research and innovation to accelerate cost reduction and technology deployment; and maximise future hydrogen export opportunities.
  • International collaboration with other countries to support the global transition to net zero.
  • Monitoring and evaluation: how the UK will monitor its progress to ensure it meets the objectives set out in the first two chapters.

Continue Reading Hydrogen in The UK

Lobbying.  The descriptor we use for seeking to influence key decision makers. It’s been a part of commercial life for centuries and many societal structures were and are built on it such as the medieval guilds, modern trade associations, and a myriad of other bodies who exist to influence, persuade and argue.  Law firms too. 

The 1998 Good Friday Agreement (also known as the Belfast Agreement), which brought to an end three decades of inter-communal violence, also heralded the advent of 23 years of increased cross-border trade and cooperation as well as an increase in Irish exports to the UK.  That ease of access and trade was facilitated by the

Covington’s four-part video series offers snapshot briefings on key emerging trends in UK Competition Law. In part three, James Marshall and Sophie Albrighton discuss digital markets, one of the key areas of focus of competition authorities around the world today, including in the UK. They are joined by guest speaker Martin Hansen, Of Counsel in

The Good Friday Agreement

The Troubles, which began in 1968 and lasted until the Good Friday Agreement (GFA) in 1998, left more than 3,700 people dead. The GFA introduced a new power-sharing N Ireland Government structure; decommissioned paramilitary weapons; established a number of joint committees between the UK, N and S Ireland to oversee the implementation of the GFA and address any possible tensions between the N and S Ireland or between communities in the North; created the ‘all-Ireland economy’; and protected the Common Travel Area.  But perhaps the most totemic and visible sign of the GFA’s success was the removal of the physical border infrastructure between N and S Ireland.
Continue Reading The UK, EU and the Northern Ireland Protocol

Covington’s four-part video series offers snapshot briefings on key emerging trends in UK Competition Law. In part two, James Marshall and Sophie Albrighton focus on current trends in enforcement and litigation. They are joined by guest speaker Louise Freeman, co-chair of Covington’s Commercial Litigation and European Dispute Resolution Practice Groups, who has extensive experience

The UK Competition Appeal Tribunal (“CAT”) has made it more difficult for defendants in follow-on competition damages claims to plead that a claimant has mitigated any overcharge by reducing the costs paid to other suppliers in a recent judgment (“Royal Mail/BT v DAF”).

The potential for pass-on to other suppliers as a defence

On May 4, 2021, the European Commission rejected the UK’s application to join the Lugano Convention.  Whilst the Commission’s Communication is advisory only, it seems likely that both the Parliament and the Council (with whom the final decision lies by qualified majority) will follow the Commission’s lead.

Although the Convention may seem a rather abstract technicality, it is in fact an important legal tool, allowing for the cross-border application of civil and commercial law with practical implications for issues such as child maintenance in family law and facilitating international legal action for smaller companies.

What is the Convention?

The 2007 Lugano Convention is an international treaty concluded between the EU and three of the EFTA States.  A new State may join the Convention if its request to do so is approved by all contracting parties, but the competence to agree to the accession of a new Party lies exclusively with the EU.

The Lugano Convention is a so-called ‘Double Convention’ Treaty in that it not only governs international jurisdiction questions, but also the recognition and enforcement of foreign judgements in civil and criminal matters. Through this mechanism, the Convention gives legal certainty to businesses which operate across borders.

How Did it work for the UK as a Member State?

The EU’s original jurisdiction and enforcement treaty was the 1968 Brussels Convention, signed by France, Germany, Italy, The Netherlands, Luxembourg and Belgium.  The first Lugano Convention was signed in 1988 by the then 12 members of the European Community and the then six members of EFTA who were not eligible to sign the Brussels Convention.  The 1988 Lugano Convention was superseded by the 2007 version. For EU Member States, considerations of jurisdiction and enforcement are governed by the Brussels (Recast) Regulation 2012.

As a Member State of the EU, the UK legal services sector had gained significant value from the Regulation (and before it, the Convention), since they facilitated the UK being the chosen legal venue for legal disputes involving companies from across the EU.  Recognizing this value, the UK applied to accede to the Convention on 8 April 2020 as a third country outside the EU – the importance of accession was increased by the absence from the EU-UK TCA of a chapter on civil legal cooperation.
Continue Reading The Lugano Convention and The UK

On Wednesday 28 April, the UK Parliament adopted the National Security & Investment Law (“NS&I Law”).  The law received Royal Assent the following day and will come into legal effect in late 2021.

The NS&I Law will introduce mandatory notification and pre-clearance requirements for transactions in 17 ‘core’ sectors.  This long-awaited piece of legislation, has passed through Parliament substantially un-amended, except that the investment threshold for mandatory notification has been raised from the acquisition of a 15 per cent. to 25 per cent. interest in shares or voting rights in an acquisition target. The UK Government retains extensive discretion to “call-in” investments for review, both within and outside the 17 ‘core’ sectors, including (i) acquisitions of control of assets and (ii) equity investments below the 25% threshold where “material influence” is acquired, if it reasonably suspects that a transaction gives rise to national security risks.

In the period since the National Security and Investment Bill was published in November 2020, the UK has left the European Union and the UK government has moved to refresh its approach to inward investment more generally (with a particular focus on technology). Through the launch of the Advanced Research and Innovation Agency (“ARIA”); a renewed focus for the UK’s Infrastructure Bank; the establishment of a planned new ‘Office for Investment’ (led by Lord Grimstone); and the establishment of the Investment Security Unit (“ISU”, which will receive and manage notifications under the NSI Law), the landscape for investment in the UK is much-changed. Investment-related concerns feature across a range of UK Government policies and priorities, not least the UK’s Integrated Review of foreign and defence policy (published in March 2021) having highlighting a number of tense relationships with countries from which investment may attract greater scrutiny.

During this period, the UK government has continued to use its existing powers to investigate transactions on national security grounds under the public interest invention regime established under the Enterprise Act 2002. Of particular interest in this regard was the decision, on 19 April 2021, by the Secretary of State for the Department for Culture Media & Sport to issue a public interest intervention notice in respect of the proposed acquisition of the UK semi-conductor company ARM Limited by Nvidia Corporation.

Scrutiny of Foreign Investment

The adoption of the NS&I Law brings the UK in line with many other countries that have enhanced their powers to scrutinise foreign investment during the past two years and particularly over the last year, influenced by COVID-19 and other global trade and supply concerns. The UK’s Five-Eyes partners all have well-established regimes for the review of foreign investment – several of which have been recently updated.  The European Union began cooperating in the review of foreign direct investment (“FDI”) in October 2020 under the EU FDI Regulation and via individual Member State laws, newly adopted or recently expanded.

What is significant about the UK’s NS&I Law is that is introduces mandatory notification obligations for investments into the UK where none have existed before – contrasting with the UK’s merger control regime under which filing is voluntary and associated public interest intervention laws (each under the Enterprise Act 2002) under which the UK Government discretion to intervene in transactions where certain defined public interest considerations are raised.

Under the NS&I Law, transactions subject to mandatory filing obligations and completed without clearance will be deemed void, ushering in a suspensory review regime in the UK for qualifying transactions for the first time. This change in approach has led to concern from the UK’s business and investment and innovation communities, as well as politicians, that the NS&I law will act to deter investment in the UK. There is concern, in particular, that uncertainty for investors is presented by the absence of a definition “national security”, potentially allowing the UK Government considerable discretion in the application of the new NS&I regime.
Continue Reading UK National Security & Investment Law is Approved by Parliament

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