On 12 March 2026, the UK Government published its response to the October 2025 consultation on proposed amendments to the ‘National Security and Investment Act (Notifiable Acquisition) (Specification of Qualifying Entities) Regulations’ under the National Security and Investment Act 2021 (NSIA). The changes aim to improve clarity, ensure the regime captures genuine national security risks, and reduce unnecessary notifications.
Key points in the response
- Targeted amendments to sector definitions: several schedules will be updated to refine scope and reduce low-risk notifications, including Artificial Intelligence, Semiconductors, Critical Minerals and Communications.
- Clarifications in other sectors: minor amendments will clarify definitions in Critical Suppliers to Government, Data Infrastructure, Energy and Suppliers to the Emergency Services.
- New Water sector schedule: a new mandatory sector covering parts of the water industry will be introduced.
- Reorganisation of sectors: semiconductors and Critical Minerals will be separated from the broader Advanced Materials category to reflect their strategic importance.
These changes should bring some more clarity as to when filing is required but it is less clear whether the changes will result in a material reduction in the volume of notifications. In the consultation itself, the Government estimated that the impact could range from an increase of around 35 notifications per year to a reduction of around 10, so the net effect may ultimately be relatively limited.
Artificial Intelligence
AI comes up a lot in this context and the changes in this area seem likely to have the most impact in practice . Under the current regime, the definition of AI is very broad. In the consultation, the Government had proposed reducing filings by excluding entities that merely use “off-the-shelf” consumer AI, which would have removed the need to analyse whether AI was used to track people, objects or events — an issue that has been a significant source of uncertainty when applying the Act.
In the final response, the Government has taken a slightly different approach. Instead, it proposes to narrow the scope of the AI schedule through a number of exclusions, including:
- the use of non-consumer AI systems for routine business activities
- the use of licensed third-party AI systems
- certain modifications to AI systems and testing activities carried out as part of routine business deployment or internal IT policies.
In addition, the Government proposes that the AI schedule should capture only entities that develop or modify AI systems themselves, rather than entities that merely deploy or use such systems.
These changes are welcome and should help reduce some of the current uncertainty. However, the practical impact will depend on the precise wording of the revised regulations.
Internal reorganisations
Finally, in the original consultation the Government indicated that it was considering changes to ensure that mandatory notifications would no longer be required for certain internal reorganisations and the appointment of liquidators. This issue was not formally consulted on and is therefore not addressed in the response. It may nonetheless represent another potentially significant change which we hope to see soon and might have some impact depending on how the relevant provisions are ultimately drafted.
Next steps
The changes will be implemented through secondary legislation, which the Government intends to lay before Parliament later in 2026. The Government will also update the current guidance. Until any such changes come into force, there is no change to the existing regime.
