The National Security and Investment Act (NSI Act) is designed to protect national security. It sets out a mandatory notification regime for buyers of shares with a national security element and a voluntary notification regime for buyers of all other shares and assets, including real property, chattels and IP. Corporate, commercial and property colleagues need to be aware of this.
The NSI Act has heinous penalties that include voiding the transaction, imposing large fines and criminal sanctions for the client (and care of the Proceeds of Crime Act, potentially for you as advisers as well in certain circumstances). It has very wide application and it, therefore, has to be considered in every deal. In many cases it won't be applicable, but you must form that view advisedly. You should not simply assume that the Act does not apply, nor should you only undertake some very brief enquiries. Where it does or may apply, we expect the timing and structuring of deals may be materially affected. For example, asset deals, split exchange and completion (to allow for NSI Act clearance) pre-sale restructuring (to deal with any element with a national security angle separately) may become common. Clients will want to ensure the NSI Act can do as little damage as possible to the deal at hand.
You may wish to review this excellent article by our colleague, Alexandra von Westernhagen.