Chinese Company Demands Compensation from the UK Over British Steel Nationalization

Jingye Group, the former owner of British Steel, is demanding compensation from the UK government after the manufacturer's nationalization last week. The Chinese company stated that the UK government's move tarnished its credibility, deterred international investors, and resulted in substantial losses for Jingye and potentially British taxpayers.

The company asserted that the UK "disregarded Jingye's continuous investment and significant contribution" and offered "almost zero compensation." Jingye announced it has initiated negotiation procedures under relevant bilateral investment agreements, reserving all rights, including recourse to international arbitration. It also stated it would represent British taxpayers in holding the UK government and British Steel's management legally liable.

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The UK disregarded Jingye's continuous investment and significant contribution and was only willing to provide almost zero compensation.

The British government took operational control of British Steel last year when Jingye considered closing blast furnaces at its Scunthorpe plant, the UK's last facility to produce virgin steel from raw materials. The Department for Business and Trade announced the nationalization on July 17, citing the need to save thousands of jobs and ensure a domestic steel supply for major construction and defense projects.

Jingye acquired British Steel in 2020, claiming it saved the company from crisis. The Chinese Foreign Ministry stated that the UK's handling of the issue would significantly influence Chinese investors' perception of the British investment environment and the UK government's credibility. China urged the UK to respect market principles and contractual spirit to find mutually acceptable solutions regarding compensation.

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China urges the UK to earnestly respect market principles and the spirit of contract, and find solutions on compensation and other issues acceptable to both sides.