UK nationalises British Steel, China protests

The UK government has nationalised British Steel with effect from 16 July 2026, bringing the company into public ownership. The step follows the Steel Industry (Nationalisation) Act receiving Royal Assent on 15 July 2026, giving ministers powers to transfer steel businesses into state hands when a public interest test is met. The government has framed the decision as necessary to protect thousands of jobs and to safeguard a vital national capability in steelmaking. British Steel’s Scunthorpe works, which employs about 2,700 people, is central to these objectives.

The Scunthorpe blast furnaces are described in reporting as the UK’s last facilities capable of producing virgin steel from raw materials. The site had already been under government operational control since April 2025, while Chinese group Jingye remained the economic owner until the formal transfer of ownership. Prime Minister Keir Starmer has said the move secures the future of steelmaking in the UK, protects skilled jobs and safeguards an important industrial capability.

Following nationalisation, ministers have appointed a new leadership team made up of non-executive directors. Their remit is to stabilise operations, manage health and safety, and maintain production at British Steel. They are expected to work with existing management, trade unions and staff to develop a commercially sustainable, low‑carbon future for the business. The government has signalled a focus on supporting communities that rely on the company and on building a competitive, decarbonised steel sector for the years ahead.

As part of the transition, an independent valuer will be appointed to determine whether any compensation is payable to Jingye, which bought British Steel in 2020. Reports state that Jingye has invested significant sums in the business and that it has been loss‑making. Ministers plan to set out the framework for any compensation scheme through regulations expected later in the year.

China’s Ministry of Commerce has issued a strong response to the UK’s decision to nationalise British Steel. It stated that it firmly opposes and is strongly dissatisfied with the move, arguing that it seriously infringes upon Jingye’s legitimate rights and interests. The ministry warned that the nationalisation severely undermines the confidence of Chinese companies investing in the UK. It urged the UK to honour its investment‑protection obligations.

The ministry also said it would closely follow developments and support Chinese companies in safeguarding their rights through legal means. It indicated that China would take strong measures to firmly protect the interests of Chinese companies affected by the decision. This reaction underlines the potential impact of the British Steel takeover on broader UK–China investment relations, even as the UK government emphasises the need to secure domestic steel production and jobs.