The National Security and Investment Act 2021 (Notifiable Acquisition) (Specification of Qualifying Entities) Regulations 2021

Made: 10th November 2021

Coming into force: 4th January 2022

In accordance with section 63(5) of that Act, a draft of this instrument was laid before Parliament and approved by a resolution of each House of Parliament.

Citation, commencement and extent

1

• (1) These Regulations may be cited as the National Security and Investment Act 2021 (Notifiable Acquisition) (Specification of Qualifying Entities) Regulations 2021.

• (2) These Regulations come into force on 4th January 2022.

• (3) These Regulations extend to England and Wales, Scotland and Northern Ireland.

Notifiable acquisitions

2

• (1) Schedules 1 to 17 specify descriptions of qualifying entity for the purposes of section 6(2) of the National Security and Investment Act 2021 (notifiable acquisitions).

• (2) A qualifying entity falls within a description in the Schedules by reason of the carrying on of an activity specified in the Schedules only if it carries on the activity in the United Kingdom.

Interpretation

3

In these Regulations—

• “the Act” means the National Security and Investment Act 2021;

• “development” means all stages prior to production, including design, design research, design analyses, design concepts, assembly and testing of prototypes, pilot production schemes, design data, process of transforming design data into goods or software, configuration design, integration design, layouts;

• “production” means all production stages, including product engineering, manufacture, integration, assembly (mounting), inspection, testing and quality assurance.

Review

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• (1) The Secretary of State must from time to time—

• (a) carry out a review of the regulatory provision contained in these Regulations; and

• (b) publish a report setting out the conclusion of the review.

• (2) The first report must be published before the end of the period of three years beginning with the day on which these Regulations come into force for any purpose.

• (3) Subsequent reports must be published at intervals not exceeding three years.

• (4) Section 30(4) of the Small Business, Enterprise and Employment Act 2015² requires that a report published under this regulation must, in particular—

• (a) set out the objectives intended to be achieved by the regulatory provision referred to in paragraph (1)(a);

• (b) assess the extent to which those objectives are achieved;

• (c) assess whether those objectives remain appropriate; and

• (d) if those objectives remain appropriate, assess the extent to which they could be achieved in another way which involves less onerous regulatory provision.

• (5) In this regulation, “regulatory provision” has the same meaning as in sections 28 to 32 of the Small Business, Enterprise and Employment Act 2015 (see section 32 of that Act).

SCHEDULE 1 — Advanced materials

Interpretation

1

In this Schedule—

• “2D” means two-dimensional;

• “3D” means three-dimensional;

• “advanced composites” relates to structural composite materials with either metallic or ceramic matrices and includes 3D reinforcing architectures for any matrix (polymer, metal or ceramic);

• “advanced materials” means completely new materials and materials that are developments on traditional materials, where such materials provide any of the following—targeted properties;advantageous properties;outstanding structural properties; oroutstanding functional properties;

• “enabler” means any material or process which is not a material described in paragraph 2(3) or 3 but is used in the manufacture or application of such materials;

• “fabrication” in sector (7) (semiconductors) of the table set out in paragraph 3 means the process of producing a microelectronic circuit on a semiconductor substrate or using other advanced materials;

• “graphene and related 2D” are those materials with attributes as defined within ISO/TS 80004-13:2017³;

• “metamaterial”—means a composite material in which the constituents are designed and spatially arranged through a rational design-led approach to change the manner in which electromagnetic, acoustic or vibrational energy interacts with the material, in order to achieve a property or performance that is not possible naturally and includes a metasurface and for this purpose “composite material” means a solid material formed from two or more constituents and “constituent” includes a region containing a vacuum, gas or liquid;does not include the types of composite materials the advanced composites described in paragraph 5 and composites or coatings containing pigments or fillers that are mixed in or blended into a binder material where both of these types of composite materials can be a constituent from which a metamaterial may be formed;

• “metasurface” means a two-dimensional form of metamaterial which includes one or more layers of material that are intentionally patterned or textured (irrespective of whether they are periodic or not) through a rational design-led approach;

• “nanotechnology” means the manipulation and control of matter predominantly in the nanoscale to make use of size-and-structure-dependent properties and phenomena distinct from those associated with individual atoms or molecules, or extrapolation from larger sizes of the same material (where “manipulation and control” includes material synthesis in relation to nanotechnology) with current or potential utility for defence, including nanomaterials, nanodevices, nanocomponents and nanosystems (including nanomachines) in accordance with ISO/TR 10993-22:2017⁴;

• “nanomaterials” means materials with any external dimension in the nanoscale or having internal structure or surface structure in the nanoscale and include nano-objects, dispersions or mixtures containing nano-objects, and nanostructured material (including structuring at an interface between materials, including air, and within a material) in accordance with ISO/TR 10993-22:2017;

• “packaging” in sector (7) (semiconductors) of the table set out in paragraph 3 means the process of turning a microelectronic circuit on an appropriate substrate into a package suitable for use in an electronic circuit but does not include the assembly and packaging of chips and devices into circuit boards;

• “photonic and optoelectronic materials and devices” in sector (8) of the table set out in paragraph 3 relate to high power lasers that are characterised by a combination of power at the output apertures (values of 1 kilowatt and above), beam quality (M² of less than 1.2), intended operating ranges (greater than 1 kilometre) and at wavelengths compatible with propagation over those distances (typically 1 micrometre to 2 micrometres wavelengths);

• “semiconductor” means—semiconductors used to form radio frequency and microwave devices;semiconductors used to realise imaging sensor arrays;the accessibility of design and production for semiconductor devices and chips where “chips” include Field Programmable Gate Array devices, System on Chip, Application Specific Integrated Circuits and Readout Integrated Circuits and where “devices” includes radio and microwave frequency control circuitry, power amplifiers, low noise amplifiers and monolithic microwave integrated circuits and detectors;

• “technical textiles” means textiles (and their processes and enablers) specifically developed for their functional performance including additional functionality (such as integrated computing, processing or data transmission), 3D architectures, protection against blast and ballistic events but does not include sportswear or clothing that is ordinarily available to consumers or household goods.

Activities

2

• (1) A qualifying entity carrying on activities that consist of or include any of the activities set out in sub-paragraph (2) in relation to—

• (a) any of the matters described in sub-paragraph (3); or

• (b) any of the matters described in relation to the sectors set out in paragraph 3.

• (2) The activities referred to in sub-paragraph (1) are—

• (a) research;

• (b) development or production;

• (c) development or production of anything designed as an enabler;

• (d) development or production of anything designed to be used for the purpose of production;

• (e) the provision of qualified or certified designs, materials, parts or products;

• (f) owning, creating, supplying or exploiting intellectual property;

• (g) provision of know-how or services of enablers;

• (h) recycling or re-using.

• (3) The matters referred to in sub-paragraph (1)(a) are materials, the export or transfer of which is controlled by virtue of their being specified in—

• (a) Schedule 2 to the Export Control Order 2008⁵; or

• (b) Annex I and Annex IV to Council Regulation (EC) No 2009/428 setting up a Community regime for the control of exports, transfer, brokering and transit of dual-use items⁶.

Sectors and matters

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The following Table sets out the sectors and matters referred to in paragraph 2(1)(b).

Sector	Matters
(1) Advanced composites	1The matters are, in relation to the sector of advanced composites, those set out in paragraphs 2 to 4.2In relation to test, inspection and production equipment—aproduction technologies and capabilities for the manufacture of metal matrix composites;bproduction technologies and capabilities for the manufacture of ceramic matrix composites;cmanufacture of 3D fibre architectures (that is with interlaminar reinforcement) for all composite types.3In relation to materials—ametal matrix composites, powder-based metal matrix composites and continuous fibre reinforced metal matrix composites;bfibre reinforced ceramic matrix composites;ccontinuous silicon carbide fibres with diameters at and below 140 micrometres;dcontinuous oxide-based ceramic fibres with diameters at or below 20 micrometres;ecoatings for the protection of ceramic matrix composites from degradation in the environment, for example ytterbium mono- and di-silicates;4In relation to software and data—acapabilities for the design and design for manufacturing of metal matrix composites and fibre reinforced ceramic matrix composites;bsoftware and computer-aided design for 3D fibre architectures and 3D preforms (with interlaminar reinforcement) for all composite types.
(2) Metals and alloys	1The matters are, in relation to the sector of metal and alloys, those set out in paragraphs 2 to 5.2In relation to systems, equipment and components, magnets utilising rare earth element-lean or element-free permanent magnetic materials with remanent magnetism, known as “Br”, greater than 1.0 Tesla and all rare-earth magnetic materials;3In relation to testing, inspection and production equipment—aany processes that are involved in the reduction of either pure or mixed oxides in the solid state into either metals or alloys in or into crude or semi-fabricated forms, including powders, in batches of at least 1 kilogram;bhot isostatic pressing (also referred to as “HIP”);cspark plasma sintering (also referred to as “SPS”) or field assisted sintering technology (also referred to as “FAST”);ddiffusion and friction-based joining processes for steel for power transmission shafts described in paragraph 4(e) of this sector (metal and alloys), titanium alloys, nickel alloys or cobalt alloys;efriction-based processes to join metallic material layer by layer to create a structure;fsuperplastic forming of titanium and aluminium alloys;gelectron beam, laser and weld arc-based metal additive manufacturing capabilities.4In relation to materials—aany alloys that are formed by chemical or electrochemical reduction of feedstocks in the solid state directly from their oxides;btitanium alloys with continuous temperature-of-use capabilities above 350 Celsius;cpowder metallurgy alloys;dnickel and cobalt based superalloys with continuous temperature-of-use capabilities above 700 Celsius;esteels for power transmission shafts with yield strengths of at least 1030 megapascals at 20 Celsius and 760 megapascals at 450 Celsius, ultimate tensile strengths of at least 1240 MPa at 20 Celsius and 950 megapascals at 450 Celsius and fracture toughnesses of at least 40 megapascals square root metres at 20 Celsius;fhigh strength high toughness weldable marine grade steels (toughness levels D, E and F);garmour grade steels;harmour grade aluminium alloys;ihigh entropy alloys and compositionally complex alloys (alloys that are formed by five or more elements where the composition is not dominated by one or two elements);jrare earth element-lean or element-free permanent magnetic materials with remanent magnetisation (also known as “Br”), greater than 1.0 Tesla, and all rare-earth magnetic materials;kmagnetic materials with high total saturation flux densities greater than 2.0 Tesla, which may include monolithic and laminate forms, and particulate and fibre reinforced composite materials.5In relation to software and data—acomputer models of complex metallic components, formed by powder-based additive manufacture, that embody a fluid and heat transfer function within their structure;bdata on the performance of complex metallic components, formed by powder-based additive manufacture, that embody a fluid and heat transfer function within their structure.
(3) Engineering and technical polymers	1The matters are, in relation to engineering and technical polymers, those set out in paragraphs 2 and 3.2In relation to test, inspection and production equipment, machines for additively manufacturing the materials listed in paragraph 3 of this sector (Engineering and technical polymers), including loaded polymer filaments to enable electrically insulating and electrically conducting, thermally conducting and insulating, or magnetic and non-magnetic materials (or any further combination).3In relation to materials—aengineering polymer materials and formulations with a glass transition temperature greater than 190 Celsius;bpolymers responsive to external stimuli such as electromagnetic, load, chemical and biological stimuli (for example electroactive polymers, thermoactive polymers and self-healing systems) but not hydrogels in applications such as nappies;chigh temperature, high pressure and chemically resistant elastomeric seals and systems;dpolymer electrical insulation materials with high temperature (greater than 200 Celsius) and high voltage (above 1kilovolt)) capabilities for application in aviation electrical power management systems;efilaments and feedstocks for additive manufacturing or 3D printing with bespoke and elevated electrical, magnetic, or electromagnetic properties (typically formed from filled polymer compositions);fadhesives capable of retaining performance at high temperatures (above 190 Celsius);gadhesives with underwater curing capabilities;hvoid-filling viscoelastic polymers, created using at least a thermoplastic polyester and curing agent, intended for use to damp vibrations in metallic structures.
(4) Engineering and technical ceramics	1The matters are, in relation to engineering and technical ceramics, those set out in paragraphs 2 and 3.2In relation to test, inspection and production equipment, spark plasma sintering or field assisted sintering technology.3In relation to materials—aboron carbide and silicon carbide ceramics for the manufacture of hard armour plates;bultra-high temperature ceramics (with melting temperatures of at least 3000 Celsius) including transition metal diborides, either as monolithic or composite forms, including other ceramic monoliths or composites where ultra-high temperature ceramics have been added to their bulk or into surfaces;cmagnetic materials, including fibres and particulates, for electromagnetic applications at frequencies above 500 megahertz;dfunctional ceramics (including ferroelectrics, magneto-dielectrics, or multi-ferroics) for acoustic applications, or electromagnetic applications above 100 megahertz;edielectric and ferroelectric materials for use in the generation of, and manipulation of, high energy or high power radio frequency radiation, including functioning under high voltage conditions.
(5) Technical textiles	1The matters are, in relation to technical textiles, those set out in paragraphs 2 to 6.2In relation to systems, equipment and components, textile materials and products manufactured primarily for technical performance and functional properties rather than aesthetic or decorative characteristics but not sportswear or clothing ordinarily available to consumers or household goods;3In relation to test, inspection and production equipment—aknitting, weaving, nonwoven or hybrid manufacturing processes related to the textile materials and products described in paragraph 2 of this sector;bfibre manufacturing processes related to the textile materials and products described in paragraph 2 of this sector (Technical textiles);cyarn manufacturing and texturing, dry fabric coating and laminating;dmanufacture of 3D textiles;eclosed loop recycling processes associated with the textile materials and products described in paragraph 2 of this sector.4In relation to materials—asmart fabrics with fibres or yarns equipped with embedded sensors that respond to stimuli and perform a specific function;bfabrics made of smart polymers and textiles to protect and prevent injury or damage from blast and ballistic events;cenergy harvesting fabrics;dtextiles or fibres incorporating activated carbon;efabrics with embedded devices for data storage and communication.5In relation to software and data—asoftware and computer-aided design for 3D textiles and preforms;bmachine learning software systems for smart textile manufacturing facilities, or for data-driven design and manufacturing of textile materials and systems.6In relation to technology—atextile-based wearable electronics with potential to enable subtle integration of electronics with the human body for human-machine interfacing;bintegration technologies to enable functionalities such as energy harvesting, data storage and communication, camouflage, structural and personnel health monitoring and protection.
(6) Metamaterials	1The matters are, in relation to metamaterials, those set out in paragraphs 2 to 6.2In relation to systems, equipment and components, metamaterials used in—aelectromagnetic components including antennas, arrays, lens, devices;belectromagnetic applications including radio frequencies and microwave through to ultraviolet wavelengths;cnano-photonics or quantum technology as an enabler;dthermal control or protection;eairborne or underwater acoustics; orfstructural applications.3In relation to test, inspection and production equipment—atest, inspection and production equipment associated with the fabrication of 2D and 3D arrangements of one or more material and/or device constituents to form a metamaterial (including additive manufacturing, printed electronics methods, nano-fabrication, chemical self-assembly or engineering biology);bequipment associated with the non-destructive test and assurance of assembled or produced metamaterial, including composition, spatially varying composition and spatial arrangement parameters.4In relation to materials—aa metamaterial;btailored or bespoke feedstocks used in fabricating metamaterials including blended or formulated filaments referred to in paragraph 3(e) of sector (3) (engineering and technical polymers)), inks or dispersions used for additive manufacturing or printing but excluding inks or dispersions commercialised for forming electrically conducting pathways (known as “wires”) in printed electronics.5In relation to software and data, accumulations of metamaterial designs, or of elements comprising metamaterials, any of which that enable artificial intelligence, machine learning design or optimisation of metamaterials.6In relation to technology, the inclusion with a metamaterial of technology in the form of systems or components, as well as material constituents, as part of the means and methods that enable metamaterials to alter their function and behaviour once installed or produced.
(7) Semiconductors	1The matters are, in relation to semiconductors, those set out in paragraphs 2 to 5.2In relation to systems, equipment and components—ahigh performance thermal imaging systems, equipment and components providing system sensitivity less than 30 milli-Kelvin for large format systems with more than 1 megapixels;bintegrated systems having multiple operating wavebands on a single camera including mid-wavelength and long-wavelength infrared;cimaging systems with on-chip (smart) processing;dtype II superlattice detectors;esingle photon counting detector arrays operating at wavelengths longer than the visible band (wavelength greater than 750 nanometres), and with a size of at least 32x32 elements, or linear arrays with a size of at least 1x256 elements;flow noise CMOS (complementary metal-oxide-semiconductor) and EMCCD (electron multiplying charge coupled device) cameras where low noise would be less than 1 photoelectron/pixel/second;gtechnology and components for non-Von Neumann computing architectures, including but not limited to neuromorphic computing systems.3In relation to test, inspection and production equipment—athe production of radio and microwave frequency systems, equipment and components incorporating compound semiconductors; example components include but are not limited to control circuitry, power amplifiers, low noise amplifiers and monolithic microwave integrated circuits, detectors and photonic devices;bfacilities operating as a compound semiconductor foundry or providing compound semiconductor processing capability;cchip and device fabrication;dceramic and polymeric packaging of processed semiconductor chips;ethe production and integration capabilities for the high-performance imaging systems described in paragraph 2 of this sector (semiconductors).4In relation to materials—aall compound semiconductors for radio frequency and microwave application including gallium nitride, gallium arsenide, gallium oxide, silicon germanium and indium phosphide;bimaging camera detector materials including cadmium mercury telluride, aluminium gallium arsenide, indium gallium arsenide and germanium silicon.5In relation to software and data, chip and device design.
(8) Photonic and optoelectronic materials and devices	1The matters are, in relation to photonic and optoelectronic materials and devices, those set out in paragraphs 2 to 6.2In relation to systems, equipment and components—apolarisation control components including materials (solid and liquid) especially for high power applications (greater than 100 watts);boptical fibre designs mitigating nonlinear effects and enabling polarisation control of the output light for high power applications in both transverse single-mode and multimode optical fibre formats;coptical fibre based components such as light diodes, tap couplers and fibre Bragg gratings;dnonlinear components for nonlinear frequency conversion such as optical fibre geometries, crystal materials and optical patterning techniques;elow loss, high bandwidth optical fibre technologies (for laser sources and amplifier stages) and manufacturing techniques where the output power is capable of being scaled up for lasers that meet the characteristics set out in the description of “photonic and optoelectronic material and devices” in paragraph 1 of this Schedule (Interpretation);fphase modulators, where the spectral linewidth of fibre laser amplifiers is limited to no more than 16 gigahertz.3In relation to test, inspection and production equipment—aoptical fibre designs and production techniques, including coating techniques and test methodologies;blaser materials manufacturing techniques, host material doping techniques and characterisation techniques.4In relation to materials—amaterials that enable increased amplification, improved quality, improved robustness, improved increased electro-optical efficiency or reduced size or volume;bmaterials and or coatings or treatments that reduce optical losses of lenses or mirrors;cmaterials and or coatings or treatments that improve or increase the physical stability or robustness of lenses or mirrors;dmaterials enabling non-mechanical beam steering for detectors, sensors and imaging systems;ematerials that reduce the size, weight and power requirements of optical detection, sensing and imaging systems;fmaterials suitable for aberration correction of high-power lasers (greater than 1 kilowatt) in the atmosphere.5In relation to software and data—aalgorithms, and their implementation in firmware, that compensate for the adverse atmospheric effects on laser beam propagation at distances greater than1 kilometre;bsoftware, hardware and algorithm developments that improve phase control/coherent beam combination and efficiency.6In relation to technology—aany approaches that enable high average optical power (greater than 3 kilowatts) combined with high quality (M2 <1.2) amplifiers;bany aspects that enable the propagation of light over significant distances (greater than 1 kilometre), including aberration correction devices.
(9) Graphene and related 2D materials	1The matters are, in relation to graphene and related 2D materials, those set out in paragraphs 2 to 5.2In relation to systems, equipment and components—adeveloping and operating equipment to synthesise single to few layer graphene and related 2D materials, including controlling the desired structure of the materials or their properties for application;busing processes including chemical exfoliation, electrochemical exfoliation, atom or molecule intercalation, surface growth, solution phase growth, vapour deposition and large area chemical vapour deposition.3In relation to test, inspection and production equipment—asynthesis and manufacturing routes to either or both—igraphene and related 2D; oriigraphene and related 2D materials with bespoke or optimised functional properties, including but not limited to functioning as semi-conductors;bresearch, development and production of materials at scale for use as a filler or pigment including forming or using graphene and related two-dimensional materials in dispersions or mixed with other binders;cresearch, development and production to integrate the use of materials in devices and systems;dconversion of graphene and other 2D materials into intermediaries using processes including surface treatment and functionalisation, dispersion in matrices, mechanical and laser shaping, coating and ink printing processes.4In relation to materials, all graphene and related 2D materials, including—agraphene, hexagonal boron nitride and transition metal dichalcogenides (such as MoS₂ and WS₂);bgraphene and related 2D materials as thin films or coatings, powder form or mixtures with other materials; andcenergetic materials (such as propellants or explosives).5In relation to technology—astacking of different 2D crystals resulting in either or both a charge redistribution between neighbouring crystals or causing structural changes;bcomponents with finely tuned properties made by combining different 2D materials, including stacking different 2D materials.
(10) Nanotechnology	1The matters are, in relation to nanotechnology, those set out in paragraphs 2 to 5.2In relation to systems, equipment and components—asensors or detectors including quantum dots with very high sensitivity to—ichemical, biological or nuclear materials (where the threshold is close to and including single molecule levels); oriilight or other forms of radiation (where the threshold is close to and including single photon levels);bautonomous remote or remotely activated sensing and reporting systems that are enabled by nanotechnology including Smart Dust;cnanomachines or nanoscale robots either with physically moving parts or capable of physical movement.3In relation to test, inspection and production equipment—atest, inspection or production of nanotechnology or nanomaterials but not including services only offering test and inspection requiring the prior destruction of the produced nanotechnology or nanomaterials to form a test artefact (such as using Scanning Electron Microscopy or Atomic Force Microscopy);bmethods to create or integrate nanotechnology for use in any of the following—icomputer processing or memory devices (excluding commoditised silicon microelectronics technologies);iicommunications or electronic warfare devices or components;iiiprecision navigation and timing systems;ivdetectors, sensing or imaging systems;vcounter-measure devices or systems;vimoving parts or soft robotics.4In relation to materials, high-density nanoceramics and carbon nanotubes to reinforce ceramics for ballistic and blast protection.5In relation to technology—atechnology that exploits nanoscale phenomena or technology that is nano-enhanced or nanoscience that further enhances nanoscale phenomena;bmaterials possessing exploitable magnetic, quantum or atomic spin states, or in combination for spinwave effects or technologies including defect centres in nanomaterials or utilising skyrmions;celectro-optic, magneto-optic, photonic or nanophotonic effects or devices (including vertical cavity emitting lasers) and circuits;dmicromechanical, nanomechanical, electromechanical, optomechanical, or electro-opto-mechanical effects or systems;emetamaterials.
(11) Critical materials	1The matters are, in relation to critical materials, the extraction, refinement, processing, production and end of life recovery (in single element, compound or product form) of any the following—iactivated carbon;iiantimonyiiiarsenic;ivberyllium;vbismuth;viboron;viicadmium;viiicerium;ixchromium;xcobalt;xidysprosium;xiierbium;xiiieuropium;xivfluorspar;xvgadolinium;xvigallium;xviigermanium;xviiigraphite;xixholmium;xxindium;xxiiridium;xxiilead;xxiiilithium;xxivlutetium;xxvmercury;xxvimolybdenum;xxviineodymium;xxviiiniobium;xxixosmium;xxxpalladium;xxxiplatinum;xxxiipraseodymium;xxxiiirhenium;xxxivruthenium;xxxvsamarium;xxxviscandium;xxxviiselenium;xxxviiitantalum;xxxixtellurium;xlterbium;xlithulium;xliitungsten;xliiivanadium;xlivytterbium;xlvyttrium.
(12) Other materials	1The matters are, in relation to other materials, those set out in paragraphs 2 to 6.2In relation to systems, equipment and components—acapacitors based on tantalum;bcomponents used in equipment or systems for the purpose of protecting optical systems and human vision from dazzle or damage by lasers.3In relation to test, inspection and production equipment—amachines for additively manufacturing fully-assembled robotic, soft-robotic, sub-systems and systems or autonomous robotic sub-systems, systems and vehicles but not including machines for additively manufacturing individual components for such sub-systems systems and vehicles;bcircuit board manufacturing of pitch, track or gap dimensions less than 30 micrometres;cnew component placement technologies, including multi-axis component placement;dadditive manufacturing or printing of moving parts, components and machines (known as “4D printing”);ebattery pack assembly specifically for defence and security applications at the stage of integration, not isolated battery cell construction.4In relation to materials—amaterials (including paints or other forms of coating or surface) that are capable of modifying (including in real time) the appearance, detectability, traceability or identification of any object to a human or to sensors within the range of 15 terahertz up to and including ultraviolet;bfoams with designed electrical, electromagnetic or thermal protection properties;choneycombs with designed electrical or electromagnetic properties;dsmart materials (including micro-fluidic systems) the properties of which can be repeatedly altered once installed at rates exceeding 1 megahertz;ematerials enabling extreme size, weight and power reduction for energy, power and propulsion sources, or sensing or communications devices and systems for use in micro or smaller unmanned systems;fmaterials used in equipment or systems for the purpose of protecting optical systems and human vision from dazzle or damage from lasers.5In relation to software and data—acreative artificial intelligence algorithms for material discovery and optimisation;bquantum simulation for material discovery and optimisation.6In relation to technology, neuromorphic or quantum technologies enabling creative artificial intelligence or quantum simulation for materials discovery.

SCHEDULE 2 — Advanced robotics

Interpretation

1

In this Schedule—

• “cognitive” means having the abilities of reasoning, perception, communication, learning, planning, problem solving, abstract thinking, decision making or organisation;

• “core components” means—sensors enabling advanced robotics to track and sense its environment;end effectors or other devices attached to advanced robotics allowing it to interact with its task or perform its operation;locomotion, where the advanced robotics is capable of moving in its environment;an energy source, including passive sources such as solar energy, providing power delivery enabling advanced robotics to move independently and to carry out its functions;hardware or software enabling sophisticated computational capabilities, including the use of artificial intelligence to process data and data sets received from the sensors and adapt the behaviour of the advanced robotics;communications capability, including the ability to communicate with a human operator or other advanced robotics.

Activities – advanced robotics

2

A qualifying entity carrying out any of the following activities—

• (a) developing advanced robotics;

• (b) producing advanced robotics;

• (c) developing or producing core components specially designed or modified for use in advanced robotics.

Advanced robotics

3

Subject to paragraph 6, “advanced robotics” means a machine that meets either or both the descriptions set out in paragraph 4 and is capable of carrying out multifunctional physical actions, including positioning or orientating materials, parts, tools, special devices or itself through variable movements in three-dimensional space.

Description of advanced robotics

4

The descriptions referred to in paragraph 3 are—

• (a) having the characteristic of autonomy set out in paragraph 5; and

• (b) being capable of using its sensors to carry out sophisticated surveillance and data collection in respect of any aspects of its environment in order to collect, store or communicate to the operator, significant volumes of high-fidelity data.

Characteristic of autonomy

5

• (1) Advanced robotics has the characteristic of autonomy where it is capable of performing actions—

• (a) independent of human control; or

• (b) independent of human control but complemented by—

• (i) manual (including tele-operation) control;

• (ii) pre-programmed operations or controls; or

• (iii) control derived from other robotics or software control systems.

• (2) The characteristics of autonomy may include either or both of the following—

• (a) using physical, sensory and cognitive capabilities in combination, to decide on and implement a course of action that will vary depending on—

• (i) the environment; or

• (ii) the behaviour, dynamics, properties or arrangement of objects in the environment, which may include the ability to self-navigate or react to stimuli or changes in order to improve performance; or

• (b) adapting or learning by carrying out actions to improve the performance of tasks from iteration and experience, which may include—

• (i) the ability to self-heal;

• (ii) the capability to identify and repair damaged robotics or components; or

• (iii) having soft robotics capabilities (robotics made from compliant materials that mimic capabilities in living organisms that enable them to adapt or respond to their surroundings).

Exclusions

6

• (1) Subject to sub-paragraph (2), “advanced robotics” does not include—

• (a) machines containing robotic systems that are readily available for purchase by consumers, including robotic toys, domestic appliances described as “smart”, vacuum cleaning robots and consumer-focussed drones, where “consumer” means an individual acting for purposes that are wholly or mainly outside of that individual’s trade, business or craft;

• (b) industrial automation systems that use mechanical tools performing repetitive functions with very basic or no sensors or cognitive ability, including—

• (i) simple sensing or imaging devices that do not confer any ability to react or change their behaviour given a change in circumstances, without human intervention;

• (ii) devices that carry out functions that require pre-set sequences of actions or require pre-set sensing of the environment;

• (c) smart speakers or similar devices lacking end effectors or locomotion.

• (2) The description of exceptions set out in sub-paragraph (1)(a) does not include self-driving vehicles.

SCHEDULE 3 — Artificial intelligence

Interpretation

1

In this Schedule—

• “artificial intelligence” means technology enabling the programming or training of a device or software to—perceive environments through the use of data;interpret data using automated processing designed to approximate cognitive abilities; andmake recommendations, predictions or decisions;with a view to achieving a specific objective;

• “advanced robotics” has the same meaning as in Schedule 2;

• “cognitive abilities” means reasoning, perception, communication, learning, planning, problem solving, abstract thinking, decision-making or organisation;

• “cyber security” means the activities necessary to protect network and information systems, the users of such systems, and other persons affected by cyber threats;

• “cyber threat” means any potential circumstance, event or action that could damage, disrupt or otherwise adversely affect network and information systems, the users of such systems and other persons;

• “network and information system” has the same meaning as in regulation 1 of the Network and Information Systems Regulations 2018⁷;

• “technology” has the same meaning as in Schedule 2 to the Export Control Order 2008⁸.

Activities – artificial intelligence

2

• (1) A qualifying entity carrying on any of the following activities for one or more of the purposes set out in sub-paragraph 2—

• (a) research into artificial intelligence; or

• (b) developing or producing goods, software or technology that use artificial intelligence.

• (2) The purposes are—

• (a) the identification or tracking of objects, people or events;

• (b) advanced robotics;

• (c) cyber security.

SCHEDULE 4 — Civil nuclear

Activity - civil nuclear

1

A qualifying entity carrying on activities that consist of or include any of the following—

• (a) subject to paragraph 2, holding a nuclear site licence granted in accordance with section 3 of the Nuclear Installations Act 1965⁹ or applying for such a licence;

• (b) subject to paragraph 2, being a tenant on a site in respect of which a nuclear site licence has been granted in accordance with section 3 of the Nuclear Installations Act 1965;

• (c) holding either or both Category I/II or Category III nuclear material as defined in regulation 3(3) and (4) of the Nuclear Industries Security Regulations 2003¹⁰;

• (d) being a Class A carrier or a Class B carrier of nuclear material as approved under regulation 14 of the Nuclear Industries Security Regulations 2003¹¹;

• (e) being in receipt of an order granting development consent under the Planning Act 2008¹² in relation to a nuclear reactor (as defined in section 26(1) of the Nuclear Installations Act 1965), or applying for such development consent;

• (f) being, or having been, required to pay a fee to the Office for Nuclear Regulation under regulation 16(1) of the Health and Safety and Nuclear (Fees) Regulations 2021¹³, where the outcome of the assessment for which that fee is to be, or has been, paid has not been determined;

• (g) holding any equipment, software or information to which regulation 2(3) or (4), of the Uranium Enrichment Technology (Prohibition on Disclosure) Regulations 2004 applies¹⁴;

• (h) holding sensitive nuclear information as defined in section 77(7) of the Anti-Terrorism, Crime and Security Act 2001¹⁵;

• (i) being given financial support under section 5 of the Science and Technology Act 1965¹⁶, or under section 93 of the Higher Education and Research Act 2017¹⁷, for or in relation to nuclear reactors (as defined in section 26 of the Nuclear Installations Act 1965).

Exclusion

2

Paragraph 1(a) or (b) do not apply where the site to which the nuclear site licence relates is controlled or operated wholly or mainly for defence purposes as defined in section 70(3) of the Energy Act 2013¹⁸.

SCHEDULE 5 — Communications

Interpretation

1

In this Schedule—

• “cable landing station” means a cable landing station for a submarine cable system;

• “electronic communications service” has the meaning given by section 32(2) of the Communications Act 2003¹⁹

• “public electronic communications network” means a public electronic communications network as defined by section 151(1) of the Communications Act 2003²⁰ and includes a submarine cable system that is provided for purposes which include the purpose of making electronic communications services available to the public;

• “public electronic communications service” means a public electronic communications service as defined by section 151(1) of the Communications Act 2003²¹, and includes an electronic communications service that is provided by means of a submarine cable system so as to be available for use by members of the public;

• “submarine cable system” means a system of fibre optic cables which—are beneath the sea (whether on or in the seabed or in a tunnel); andare used for the conveyance of signals.

Public electronic communications providers

2

• (1) A qualifying entity which—

• (a) carries on activities which consist of or include either or both of the following—

• (i) providing a public electronic communications network;

• (ii) providing a public electronic communications service; and

• (b) meets the turnover condition in sub-paragraph (2).

• (2) The turnover condition is that the turnover of the entity’s relevant business for the relevant period is at least £50,000,000.

• (3) In sub-paragraph (2)—

• (a) “relevant business” means so much of any business carried on in the United Kingdom by the entity in question or any of its associated entities as consists of either or both of the following—

• (i) the provision of a public electronic communications network;

• (ii) the provision of a public electronic communications service;

• (b) “relevant period” means—

• (i) the period of one year ending with the 31st March last before the time when a person gains control of the qualifying entity, by virtue of one or more of the cases described in subsection (2), (5) or (6) of section 8 of the Act; and

• (ii) in the case of an entity which at that time has been carrying on that business for a period of less than a year, the period, ending with that time, during which it has been carrying it on.

• (4) For the purposes of sub-paragraph (3)(a), another qualifying entity is an associated entity of the entity in question if—

• (a) the entity in question owns, or has a controlling interest in, the other qualifying entity;

• (b) the other qualifying entity owns, or has a controlling interest in, the entity in question; or

• (c) a person or group of persons owns, or has a controlling interest in, both entities.

• (5) For the purposes of sub-paragraph (4), a person has a controlling interest in a qualifying entity if the person holds more than 50% of the shares or voting rights in the entity; and subsections (3), (4), and (7) of section 8 of the Act apply for the interpretation of this sub-paragraph.

• (6) For the purposes of this paragraph—

• (a) turnover is to be calculated in conformity with accounting practices and principles which are generally accepted in the United Kingdom;

• (b) turnover is to be limited to the amounts derived by an entity from the relevant business after deduction of sales rebates, value added tax and other taxes directly related to amounts so derived;

• (c) where the relevant business of the entity in question is carried on by two or more entities that each prepare accounts the turnover shall be calculated by adding together the turnover of each, except that no account shall be taken of any turnover resulting from the supply of goods or the provision of services between them.

Associated facilities

3

• (1) A qualifying entity carrying on activities which consist of or include the making available of anything that—

• (a) is an associated facility by reference to a qualifying network or qualifying service; and

• (b) is not excluded by sub-paragraph (2) or (3).

• (2) An associated facility consisting of a building or an entry to a building is excluded by this sub-paragraph unless the main purpose of the building is to host a network element that is active.

• (3) An associated facility other than a building or an entry to a building is excluded by this sub-paragraph if the associated facility is an element (such as a pipe, mast, duct, antenna installation, tower or pole) which—

• (a) is not itself active; and

• (b) is designed merely to host either or both of the following—

• (i) other network elements that are not active;

• (ii) cables (including strands of optical fibre).

• (4) In this paragraph—

• “associated facility” has the meaning given by section 32(3) of the Communications Act 2003²² but as if the reference in that provision to a “facility, element or service” included a reference to a cable landing station;

• “qualifying network” means a public electronic communications network provided by a qualifying entity falling within paragraph 2;

• “qualifying service” means a public electronic communications service provided by a qualifying entity falling within paragraph 2.

Repair or maintenance of submarine cable systems or cable landing stations

4

• (1) A qualifying entity carrying on activities which consist of or include the provision of services for the repair or maintenance of—

• (a) a submarine cable system (in the United Kingdom or elsewhere) forming part of a public electronic communications network that—

• (i) is provided in the United Kingdom by a qualifying entity falling within paragraph 2; or

• (ii) interconnects with a public electronic communications network provided in the United Kingdom by a qualifying entity falling within paragraph 2; or

• (b) a cable landing station in the United Kingdom that is used in connection with a public electronic communications network or public electronic communications service provided in the United Kingdom by a qualifying entity falling within paragraph 2.

• (2) In this paragraph “interconnect” is to be read in accordance with section 151(2) of the Communications Act 2003.

Information systems

5

• (1) A qualifying entity carrying on activities that consist of or include supplying to persons in the United Kingdom services which consist of or include one or more of the following—

• (a) providing a top-level domain name registry which, in any relevant 168-hour period, serviced 14 billion or more queries from devices located in the United Kingdom for domains registered within the Internet Corporation for Assigned Names and Numbers;

• (b) providing a domain name system resolver service which, in any relevant 168-hour period, serviced 500,000 or more different Internet Protocol addresses used by persons in the United Kingdom;

• (c) providing a domain name system authoritative hosting service servicing 100,000 or more domains registered to persons with an address in the United Kingdom.

• (2) A qualifying entity which—

• (a) carries on activities which consist of or include supplying to persons in the United Kingdom services which consist of or include providing an internet exchange point; and

• (b) has 30% or more of the market share among operators of internet exchange points in the United Kingdom in terms of interconnected autonomous systems.

• (3) In this paragraph—

• “domain name system” has the meaning given to “Domain Name System” in paragraph 10(5)(a) of Schedule 2 to the Network and Information Systems Regulations 2018²³;

• “internet exchange point” has the meaning given in paragraph 10(5)(c) of Schedule 2 to the Network and Information Systems Regulations 2018;

• “relevant 168-hour period” means any consecutive period of 168 hours falling within the 12 months ending with the time when a person gains control of the qualifying entity by virtue of one or more of the cases described in subsection (2), (5) or (6) of section 8 of the Act;

• “top-level domain name registry” has the meaning given in paragraph 10(5)(d) of Schedule 2 to the Network and Information Systems Regulations 2018.

SCHEDULE 6 — Computing hardware

Interpretation

1

In this Schedule—

• “computer processing unit” means—a central processing unit (also referred to as “CPU”);a field programmable gate array (also referred to as “FPGA”);a microcontroller;a system on chip;a graphics processor unit; ora specialist processor for artificial intelligence applications;

• “fabrication” means the process of producing a microelectronic circuit on a semiconductor substrate or using other advanced materials;

• “packaging” means the process of turning a microelectronic circuit on an appropriate substrate into a package suitable for use in an electronic circuit but does not include the assembly and packaging of chips and devices into circuit boards;

• “roots of trust” means hardware, firmware or software components that are inherently trusted to perform critical security functions.

Activity – computing hardware

2

A qualifying entity whose activities consist of one or more of the activities set out in paragraph 3.

3

The activities referred to in paragraph 2 are—

• (a) the ownership, creation, supply or exploitation of intellectual property relating to any of the following—

• (i) computer processing units;

• (ii) architectural, logical or physical designs for such units;

• (iii) the instruction set architecture for such units;

• (iv) code, written in a low-level language, that can control how such units operate;

• (v) integrated circuits with the purpose of providing memory;

• (b) the design, maintenance or delivery of a service for the secure provisioning or management of either or both of the following—

• (i) roots of trust of computer processing units;

• (ii) code, written in a low level language, that can control how such units operate;

• (c) the fabrication or packaging of either or both of the following—

• (i) computer processing units;

• (ii) integrated circuits with the purpose of providing memory.

SCHEDULE 7 — Critical suppliers to government

Interpretation

1

In this Schedule—

• “government” has the same meaning as “contracting authority” in section 2 of the Procurement Act 2023, but—as if section 2(5)(b), and the reference to paragraph (b) in section 2(5)(d)(ii), were omitted, anddoes not include the Common Council of the City of London other than for the purposes of its functions as a local authority, police authority or port health authority;

• “relevant public contract” means a contract for pecuniary interest between one or more persons and government, where the contract has as its object the execution of works, the supply of products or the provision of services.

Activity – critical suppliers to government

2

A qualifying entity being a party to a relevant public contract where the contract contains one or more of the features set out in paragraph 2.

3

The features referred to in paragraph 1 are—

• (a) either or both the processing or storage of material to which a security classification of SECRET or TOP SECRET has been applied in accordance with the document titled “Government Security Classifications Version 1.1 – May 2018”²⁴ published by the Cabinet Office;

• (b) a requirement to have List X accreditation as described in the document titled “Security Requirements for List X Contractors Version 10.0 – April 2014” published by the Cabinet Office²⁵;

• (c) a requirement for employees of the qualifying entity to be vetted at or above ‘Security Check’ level as described in guidance titled “National security: vetting clearance levels” published on 12 February 2020²⁶ by the United Kingdom Security Vetting.

SCHEDULE 8 — Cryptographic authentication

Interpretation

1

In this Schedule—

• “consumer” means an individual acting for purposes that are wholly or mainly outside that individual’s trade, business, craft or profession;

• “authentication” means verifying—the identity of a user, process or device; orthe origin or content of a message or other information;

• “cryptography” means the discipline which embodies principles, means and methods for the transformation of data in order to hide its information content, prevent its undetected modification or prevent its unauthorised use and is limited to the transformation of information using one or more secret parameters or associated key management;

• “secret parameter” means a variable, constant or key kept from the knowledge of others or shared only within a group.

Activity – cryptographic authentication

2

A qualifying entity carrying on activities consisting of or including research into, developing or producing, any product which—

• (a) has authentication as a primary function;

• (b) employs cryptography in performing that function; and

• (c) is not ordinarily supplied to or made available for acquisition by consumers.

SCHEDULE 9 — Data infrastructure

Interpretation

1

In this Schedule—

• “administrative access” refers to either or both authorisation or access granted via either or both logical or administrative access controls by virtue of which an entity may access relevant data infrastructure or control access to relevant data infrastructure where such access would otherwise be restricted or compartmented and where such access would permit the modification of the relevant data infrastructure in a way that was not authorised;

• “electronic communications network” has the meaning given in section 32(1) of the Communications Act 2003²⁷;

• “public electronic communications network” has the meaning given in section 151(1) of the Communications Act 2003;

• “public electronic communications service” has the meaning given in section 151(1) of the Communications Act 2003;

• “public sector authority” means an authority listed in paragraph 2;

• “relevant activity” means storing, processing or transmitting data in digital form which are used in connection with the administration and operation of a public sector authority;

• “relevant data infrastructure” is physical or virtualised infrastructure, which—is used for a relevant activity and the qualifying entity—has a contract with a public sector authority to provide the relevant activity; oris a sub-contractor who has been notified that it is in a chain of sub-contractors which begins with the contractor that has a contract with the public sector authority for the purpose of providing the relevant activity, where the sub-contractor is providing a relevant activity that would fulfil or contribute towards the fulfilment of the main contract;is provided for peering, interconnection or exchange of digital data between providers of public electronic communications networks and/or providers of public electronic communications services but which is not owned by a provider of public electronic communications networks or a provider of a public electronic communications service; orenables the interconnection of one or more public electronic communications networks with an electronic communications network where part of that network is provided by means of a submarine cable system;

• “specialist or technical services” means either or both—equipment installation services;equipment repair and maintenance services;

• “submarine cable system” means a system of fibre optic cables which—are beneath the sea (whether on or in the seabed or in a tunnel); andare intended for the conveyance of signals.

Interpretation – public sector authority

2

The authorities referred to in the definition of a “public sector authority” in paragraph 1 are set out in the following Table.

Public sector authority
Prime Minister’s Office
Attorney General’s Office
Crown Prosecution Service
Government Legal Department
Serious Fraud Office
Cabinet Office
Crown Commercial Service
Government Property Agency
The Electoral Commission
UK Statistics Authority
Department for Business and Trade
Competition and Markets Authority
HM Land Registry
UK Export Finance (also known as the Exports Credit Guarantee Department)
Department for Energy Security and Net Zero
Office of Gas and Electricity Markets (Ofgem)
Nuclear Decommissioning Authority
Department for Science, Innovation and Technology
Information Commissioner
Intellectual Property Office
Meteorological Office
Office of Communications (Ofcom)
United Kingdom Space Agency
Department for Culture, Media and Sport
The National Archives
Department for Education
Education and Skills Funding Agency
Office of Qualifications and Examinations Regulation (Ofqual)
Office for Standards in Education, Children’s Services and Skills (Ofsted)
Teaching Regulation Agency
Department for Environment, Food and Rural Affairs
Water Services Regulation Authority (Ofwat)
. . .
. . .
Department for Transport
Civil Aviation Authority
Driver and Vehicle Licensing Agency
Maritime and Coastguard Agency
Office of Rail and Road
Department for Work and Pensions
Health and Safety Executive
Office for Nuclear Regulation
Department of Health and Social Care
NHS England
Joint Committee on Vaccination and Immunisation
Medicines and Healthcare products Regulatory Agency
Public Health England
UK Health Security Agency
Foreign, Commonwealth and Development Office
Wilton Park
GCHQ
HM Treasury
Bank of England
Financial Conduct Authority
Government Actuary’s Department
Government Internal Audit Agency
HM Revenues and Customs
National Audit Office
National Infrastructure Commission
National Savings and Investments
Office for Budget Responsibility
UK Debt Management Office
Valuation Office Agency
Home Office
National Crime Agency
Investigatory Powers Commissioner’s Office
Ministry of Defence
Defence Electronics and Components Agency
Defence Equipment and Support
Defence Science and Technology Laboratory
Submarine Delivery Agency
United Kingdom Hydrographic Office
Ministry of Housing, Communities and Local Government
Queen Elizabeth II Centre
Ministry of Justice
Criminal Injuries Compensation Authority
HM Courts and Tribunals Service
HM Prison and Probation Service
Legal Aid Agency
Office of the Public Guardian
Supreme Court of the United Kingdom
Northern Ireland Office
Office of the Advocate General for Scotland
Office of the Leader of the House of Commons
Office of the Leader of the House of Lords
Office of the Secretary of State for Scotland
Office of the Secretary of State for Wales
Secret Intelligence Service
Security Service
Northern Ireland Executive
The Executive Office
Department of Agriculture, Environment and Rural Affairs
Department for Communities
Department for the Economy
Department of Education
Department of Finance
Department of Health
Department for Infrastructure
Department of Justice
Invest Northern Ireland
The Scottish Government
Crown Office and Procurator Fiscal Service
Disclosure Scotland
Education Scotland
Office of the Accountant in Bankruptcy
Registers of Scotland
Revenue Scotland
Scottish Courts and Tribunals Service
Scottish Fiscal Commission
Scottish National Investment Bank
Scottish Public Pensions Agency
Social Security Scotland
Student Awards Agency for Scotland
The Scottish Ministers
Transport Scotland
The Welsh Government
Permanent Secretary’s Group
Office of the First Minister Group
The Health and Social Services Group
The Economy, Skills and Natural Resources Group
The Education and Public Services Group

Activity – data infrastructure

3

A qualifying entity carrying on any of the activities set out in paragraph 4.

4

The activities referred to in paragraph 3 are—

• (a) owning or operating relevant data infrastructure;

• (b) managing relevant data infrastructure on behalf of other entities;

• (c) managing facilities where relevant data infrastructure is located;

• (d) providing specialist or technical services to entities carrying on activities described in sub-paragraphs (a), (b) or (c), which give the entity providing those specialist or technical services physical access to relevant data infrastructure;

• (e) providing services where the provision of such services gives the entity providing those services administrative access to relevant data infrastructure;

• (f) producing or developing software designed for use in the services in sub-paragraph (e) which configures or manages the provision of administrative access.

SCHEDULE 10 — Defence

Interpretation

1

In this Schedule—

• “defence” has the meaning given to it bysection 2(4) of the Official Secrets Act 1989²⁸; and

• “government contractor” has the meaning given to it by section 12 of the Official Secrets Act 1989.

Activity - defence

2

A qualifying entity carrying on activities that comprise or include the research, development, production, creation or application of goods or services which are used or provided for defence or national security purposes where that entity meets a condition in paragraph 3.

3

The conditions referred to in paragraph 2 are that the entity—

• (a) is a government contractor or any sub-contractor in a chain of sub-contractors which begins with the government contractor which provides goods or services within the scope of paragraph 2; or

• (b) has been notified by or on behalf of the Secretary of State of information, documents or other articles of a classified nature which the entity or an employee of the entity may hold or receive relating to the activities within the scope of paragraph 2.

SCHEDULE 11 — Energy

Interpretation

1

In this Schedule—

• “aggregation” means combining multiple customer loads or generated electricity for sale, purchase or auction in the electricity market of Great Britain;

• “downstream oil activity” means any of the following activities—the import of any of crude oil, intermediates, components and finished fuels;the storage of any of crude oil, intermediates, components and finished fuels;the production of intermediates, components and finished fuels through refining or blending processes;the distribution of petroleum-based fuels to storage sites by road, pipeline, rail or ship;the delivery of petroleum-based fuels to retail sites, airports or end users;

• “existing upstream petroleum facility” means an upstream petroleum facility that began operating before the first day of the month that is 12 calendar months before the month in which a person gains control, by virtue of one or more of the cases described in subsection (2), (5) or (6) of section 8 of the Act, of the qualifying entity;

• “gas” means any substance which is or (if it were in a gaseous state) would be gas within the meaning set out in section 48(1) of the Gas Act 1986;²⁹

• “gas interconnector” has the meaning set out in section 5(8) of the Gas Act 1986³⁰;

• “gas processing facility” has the meaning set out in section 90(1) of the Energy Act 2011³¹;

• “gas processing operation” has the meaning set out in section 90(2) of the Energy Act 2011;

• “generate” in relation to electricity means carrying on an act within section 4(1)(a) of the Electricity Act 1989³²;

• “generating asset” means an asset used to generate electricity;

• “group undertaking” has the meaning set out in section 1161(5) of the Companies Act 2006³³;

• “LNG import or export facility” has the meaning set out in section 12(6) of the Gas Act 1995³⁴ but does not include facilities in the territorial sea adjacent to Great Britain or the sea in any area designated under section 1(7) of the Continental Shelf Act 1964³⁵;

• “new upstream petroleum facility” means an upstream petroleum facility that had not begun operating before the first day of the month that is 12 calendar months before the month in which a person gains control, by virtue of one or more of the cases described in subsection (2), (5) or (6) of section 8 of the Act, of the qualifying entity;

• “oil equivalent” means petroleum and, for the purposes of assessments of throughput, where petroleum is in a gaseous state 1,100 cubic meters of this petroleum at a temperature of 15 degrees Celsius and pressure of one atmosphere is counted as equivalent to one tonne;

• “petroleum” has the same meaning as in Part 1 of the Petroleum Act 1998³⁶, and includes petroleum that has undergone any processing;

• “petroleum licence” means a licence granted under section 3 of the Petroleum Act 1998³⁷ or section 2 of the Petroleum (Production) Act 1934³⁸;

• “petroleum production project” has the meaning set out in section 90(2) of the Energy Act 2011;

• “terminal” has the meaning set out in section 90(2) of the Energy Act 2011, but does not include gas processing facilities in the United Kingdom or LNG import or export facilities;

• “upstream petroleum facility” means a terminal, upstream petroleum pipeline or unit of infrastructure that is or will be necessary to a petroleum production project;

• “upstream petroleum pipeline” has the meaning set out in section 90(2) of the Energy Act 2011, but does not include gas interconnectors.

Activity - energy

2

A qualifying entity carrying on any of the activities set out in paragraph 3.

3

The activities referred to in paragraph 2 are—

• (a) in respect of any existing upstream petroleum facility that meets the conditions set out in paragraph 4(2)—

• (i) owning;

• (ii) operating;

• (iii) holding a petroleum licence in respect of; or

• (iv) where the qualifying entity meets the condition set out in paragraph 4(3), enabling the operation of;

• (b) in respect of any new upstream petroleum facility that meets the conditions set out in paragraph 4(4)—

• (i) owning;

• (ii) operating;

• (iii) holding or applying for a petroleum licence in respect of; or

• (iv) where the qualifying entity meets the condition set out in paragraph 4(5)—

• (aa) developing;

• (bb) enabling the operation of; or

• (cc) enabling the development of;

• (c) holding a transmission licence, distribution licence or interconnector licence under section 6 of the Electricity Act 1989³⁹ or carrying on any activity in pursuance of an exemption from section 4(1)(b), 4(1)(bb) or 4(1)(d) of the Electricity Act 1989 granted to the qualifying entity by order under section 5(1) of the Electricity Act 1989⁴⁰;

• (d) where the qualifying entity meets the condition set out in paragraph 4(6)—

• (i) holding a generation licence under section 6 of the Electricity Act 1989 or carrying on any activity in pursuance of an exemption from section 4(1)(a) of the Electricity Act 1989 granted to the qualifying entity by order under section 5(1) of the Electricity Act 1989; or

• (ii) carrying on aggregation;

• (e) holding a licence under section 7 or 7ZA of the Gas Act 1986⁴¹ or carrying on any activity in pursuance of an exemption from sections 5(1)(a) or 5(1)(aa) of the Gas Act 1986 ⁴² granted to the qualifying entity by order under section 6A(1) of the Gas Act 1986⁴³;

• (f) owning or operating—

• (i) any gas processing facility in Great Britain that meets the condition set out in paragraph 4(8); or

• (ii) any LNG import or export facility that meets the condition set out in paragraph 4(9);

• (g) where the qualifying entity meets the conditions set out in paragraph 4(10), supplying petroleum-based road, aviation or heating fuels (including liquefied petroleum gas) to persons in the United Kingdom.

Conditions

4

• (1) This paragraph sets out the conditions referred to in paragraph 3.

• (2) The conditions referred to in paragraph 3(a) are that the existing upstream petroleum facility—

• (a) has a throughput of greater than 3,000,000 tonnes of oil equivalent over the 12 calendar months preceding the month in which a person gains control, by virtue of one or more of the cases described in subsection (2), (5) or (6) of section 8 of the Act, of the qualifying entity; and

• (b) is—

• (i) situated in whole or in part in the United Kingdom; or

• (ii) used in connection with the supply of petroleum to persons in the United Kingdom.

• (3) The condition referred to in paragraph (3)(a)(iv) is that the qualifying entity is an owner or operator of the existing upstream petroleum facility.