China urges UK to protect rights of Chinese investors after British Steel nationalization

The UK government completed the nationalization of British Steel on July 16, seizing control of the country’s last primary steelmaking facility from Chinese owner Jingye Group. Beijing is not happy about it.

China’s Ministry of Commerce has publicly condemned the move as a “forced takeover,” urging Britain to protect the rights of Chinese investors and warning that the action undermines confidence for Chinese firms operating in the UK.

What actually happened at British Steel

Jingye Group, a Chinese steelmaker, acquired British Steel back in 2020 and proceeded to pour over £1.2 billion (roughly $1.6 billion) into the operation. The Scunthorpe-based facility employs approximately 2,700 workers and represents the UK’s last remaining primary steelmaking plant.

British Steel was hemorrhaging about £700,000 per day in operational losses.

When Jingye signaled plans to shut down the blast furnaces rather than continue absorbing those losses, the UK government stepped in. First came the Steel Industry (Special Measures) Act in 2025, which allowed authorities to assume operational control. Then came the formal nationalization through the Steel Industry (Nationalisation) Bill, completed this month.

The diplomatic fallout

Jingye launched compensation consultations under the UK-China bilateral investment treaty back in June, seeking what it considers adequate reparations for both its capital investments and loss of control over the facility. An independent valuation process is expected to determine the final payout figures.

China’s Ministry of Commerce went beyond just defending Jingye’s specific interests. The language about undermining “investor confidence for Chinese firms” in the UK is a signal that Beijing views this as a precedent-setting event, not an isolated dispute.

Industry observers have noted that the case could have long-term repercussions on investment sentiment, not just from Chinese firms but from foreign investors broadly.

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