UK Law and Practice Contributed by: Tom Sprange KC, Andrea Stauber, Martina Antosova and Lucy Pearson, King & Spalding International LLP
• EDF Energy (owned by French state-owned energy firm EDF); • E.ON UK (owned by German energy firm E.ON SE); • nPower (ultimately owned by E.ON UK); • OVO (acquired by E.ON SE in May 2026); and • Scottish Power (owned by Spanish energy firm Iberdrola). As of May 2026, there are 20 holders of supply licenc- es in Northern Ireland. 1.3 Foreign Investment Review Process National Security and Investment Act The National Security and Investment Act 2021 (NSIA) introduced new requirements for foreign direct invest- ment in certain business sectors that potentially affect national security. The new regime created notification requirements for certain transactions on either a man- datory or voluntary basis. Mandatory pre-notification requirements apply in respect of entities in “key sec- tors”, which includes energy (and specifically includes entities that hold transmission, distribution, intercon- nector and/or generation licences). The requirements apply to transactions involving the acquisition of a 25% stake or more (or equivalent levels of voting rights, including certain “veto” rights) in an entity, as well as certain acquisitions that involve the acquirer moving to a higher level of interest (eg, more than 50%). 1.4 Sale of Power Industry Assets Restrictions As explained in 1.3 Foreign Investment Review Pro- cess , since 4 January 2022, a mandatory notification regime under the NSIA has applied to transactions that fall within the definition of a “notifiable acqui- sition” (as set out in Section 6 of the NSIA). Under Section 13 of the NSIA, a notifiable acquisition that is completed without the approval of the Secretary of State is void. To qualify as a notifiable acquisition, the transaction must meet both of the following criteria, per Section 6 and Section 8 of the NSIA: • the subject being acquired must be a qualifying entity that operates within a specific high-risk sec- tor of the economy – the energy sector is specified
as such by the Notifiable Acquisition Regulations; and • as a result of the transaction, the acquirer gains control of the qualifying entity by: (a) acquiring voting rights that enable it to secure or prevent the passage of any class of reso- lution governing the affairs of the qualifying entity; or (b) increasing its shares or voting rights: (i) from 25% or less to more than 25%; (ii) from 50% or less to more than 50%; or (iii) from less than 75% to 75% or more. The person gaining control or acquiring an interest in the qualifying entity must submit a notification digi- tally using the National Security and Investment (NSI) electronic portal and must comply with the form and content prescribed by the NSI Notices Regulation. Where a transaction does not require a mandatory notification, parties may voluntarily notify the Sec- retary of State in order to obtain a call-in decision regarding the transaction. There is a clear upwards trend from 2022 to 2025 in the number of notifications and decisions in the energy sector. Principal Law Governing Sales or Mergers The Competition Act 1998 and the Enterprise Act 2002 are the major sources of competition law in the UK and govern mergers. The Competition Act 1998 prohibits companies from: • engaging in practices that distort, restrict or pre- vent competition in the market; and • abusing a dominant position in the market. The Enterprise Act 2002 builds upon the Competition Act 1998 and sets out the tests for when and how the government can intervene in mergers. Any mergers that began after 1 January 2021 require clearance from the UK’s Competition and Markets Authority (CMA). The Digital Markets, Competition and Consumers Act 2024 introduced wide-ranging amendments to the UK competition and consumer law regimes – thereby
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