The UK government has published its annual report on the operation of the National Security and Investment Act 2021 (NSIA), for the reporting period from 1 April 2025 to 31 March 2026. With this being the fifth annual report on the NSIA, in this briefing we focus on the main trends in the implementation of the regime since it came into force on 4 January 2022 and highlight the key practical takeaways for businesses doing deals affecting the UK (see our briefing on the fourth annual report here).
An increasing number of NSIA notifications are being made
The number of NSIA notifications is steadily increasing. In 2025/26, the Investment Security Unit (ISU) received 1,324 notifications. This represents an increase of around 16% on the number of NSIA notifications made in 2024/25 (1,143), which in turn marked 25% more than in 2023/24 (906). The defence sector accounted for more than half (58%) of total notifications.
Overall, the continued rise in the number of notifications suggests that the NSIA has become a mainstream feature of UK deal-making, with awareness of the regime bedding in and businesses and advisers increasingly identifying transactions within its scope. An NSIA assessment should be considered at an early stage of a transaction, so that if a filing is required, it can be factored into the transaction timetable from the outset.
The rate at which government “calls in” transactions for review remains stable
The rate at which the government is exercising its power to “call-in” notified transactions for review on national security grounds remains broadly flat at 4.4%. There were 60 call-ins in 2025/26 (54 notified; 6 non-notified), compared to 56 call-ins in 2024/25 (49 notified; 7 non-notified) and 45 call-ins in 2023/24 (41 notified; 4 non-notified). Defence accounted for 47% of call-ins (up nearly 10% from 2024/25).
The clearance rate is consistently high
Most transactions continue to be cleared. In 2025/26, 95.6% of reviewed notified acquisitions were cleared without further action at the end of the initial 30 working day review period. The clearance rate has effectively remained the same for the past three NSIA reporting periods (95.5% in 2024/25 and 95.6% in 2023/24).
The consistently high clearance rate, despite the increasing number of notifications, shows that a notification will usually result in clearance without further action. The practical impact of the NSIA upon most transactions is therefore timing and process management, rather than intervention.
There has been a decline in final orders
The number of final orders has significantly reduced, with the government imposing 9 final orders in 2025/26, down from 17 in 2024/25. In each of these reporting periods, only one transaction was blocked. The remainder were allowed to proceed subject to conditions. The transactions affected by the 9 final orders were in the areas of advanced materials, data infrastructure and military and dual-use, with advanced materials taking the lead (from defence) as the most affected of the 17 “sensitive” sectors.
The reduction in the number of final orders, despite the increase in notifications, suggests that the NSIA is becoming an established feature of transaction planning, rather than a regime characterised by increasing intervention. For most businesses, the key issue is identifying filing requirements early and managing transaction timetables.
The ISU is taking longer to accept notifications
The time taken for the ISU to acknowledge receipt of a notification has risen from 7 to 11 working days for mandatory filings and from 8 to 13 working days for voluntary filings. This increase may be due, at least in part, to the rising number of notifications. However, it’s also possible that it means the ISU is spending more time checking notifications for completeness before acceptance.
UK acquirers are firmly within scope
In 2025/26, UK-associated acquirers were linked to more than half (52%) of call-ins and final orders (5 of 9). Over the past 3 years, this figure has slightly increased year-on-year, from 39% in 2023/24 and from 48% in 2024/25.
These figures suggest that the government is focusing less on the nationality of the acquirer and more on whether control over what is being acquired could create national security concerns.
Offences and penalties
The government identified 42 potential offences for completing notifiable acquisitions without approval. No penalties were imposed but the parties were required to provide reassurance that steps had been taken to prevent recurrence.
While the government hasn’t yet imposed any penalties under the NSIA regime, it retains the power to do so and is clearly actively monitoring transactions for any which should have been (but were not) notified. If a transaction falls within the mandatory regime, completion without approval automatically renders the transaction void and can expose both parties to significant legal, enforcement and commercial risk. Treating NSIA as a standard deal-planning matter is the best way to manage such risk.
Proposed changes to the NSIA regime
To make the NSIA regime more targeted and efficient while preserving the government's ability to intervene where national security concerns arise, the government is proposing changes to reduce unnecessary filings, update the scope of the mandatory notification sectors and improve the notification process for businesses (see our briefing on the proposed changes here). We will report with further detail on the proposed changes and commencement dates once the government releases more information later in 2026.
How can we help
Mills & Reeve’s competition team has extensive experience advising investors and businesses on mandatory, voluntary and retrospective NSIA applications, helping businesses to understand the impact of the regime on the deal timetable and providing guidance on the risk of the deal being called in.
If you have any specific questions or need further guidance, please get in touch with a member of our team.
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