To ask the Secretary of State for Defence if he will discuss with the Secretary of State for Business, Enterprise and Regulatory Reform and the Chancellor of the Exchequer the potential for national security implications to arise from overseas shareholdings in British defence companies.

As the Government's Defence Industrial Strategy (Cm6697) made clear, we welcome overseas investment in the UK's Defence technological and industrial base. Transactions in the defence arena are closely monitored by Government Departments. Where a potential acquisition by a foreign company raises national security concerns, the Enterprise Act 2002 empowers the Secretary of State for Business, Enterprise and Regulatory Reform, normally following consultation with Defence Ministers, to intervene in order to remedy those concerns, usually through statutory undertakings provided by the acquiring company.