The United Kingdom nationalised British Steel on Thursday, prompting China’s Ministry of Commerce to declare it was “strongly dissatisfied” and that the move dealt “a severe blow to Chinese companies’ confidence in investing in the UK.” The takeover, executed under the newly enacted Steel Industry (Nationalisation) Act 2026, transferred the Scunthorpe-based steelmaker from its previous owner, China’s Jingye Group, into public ownership. A new leadership team has been appointed to stabilise the business and reposition it as a “commercially sustainable, low-carbon enterprise,” the UK government stated.

According to London, the intervention was essential to maintain primary steel production at the Scunthorpe site, protect 4,000 skilled jobs, and safeguard supply chains for defence, rail, and construction. Prime Minister Keir Starmer described British Steel as “a cornerstone of Britain’s industrial strength” and said the government would always act in the national interest. The decision followed a year-long standoff in which Jingye had threatened to close the blast furnaces, prompting an emergency recall of Parliament in April last year to pass special measures keeping the plant open.

Beijing’s response, delivered through a Ministry of Commerce spokesperson, accused the UK of disregarding Jingye’s “important contributions to the British economy and society” and forcibly taking control “in the name of national security.” The ministry said the action seriously undermined Jingye’s legitimate rights and interests, and urged London to “abide by relevant international rules” and fulfil obligations under the China-UK bilateral investment treaty. China added it would support Chinese companies in safeguarding their rights through legal means and take “strong measures” to protect their interests, without specifying what those measures might entail.

Viewed from European capitals, the nationalisation marks a further geopolitical flashpoint in a relationship already strained by security-driven decoupling. Analysts in London note that the UK previously eased China General Nuclear out of the Sizewell C nuclear project in 2021 and, in 2020, ordered the removal of Huawei equipment from 5G networks. The British Steel takeover, coming just months after Starmer’s visit to China aimed at bringing “stability and clarity” to bilateral ties, reinforces a pattern in which national security considerations override commercial arrangements. Beijing has indicated it will closely monitor developments and back legal challenges by Jingye, while the UK government proceeds with restructuring the company under public control.